ON TRAVEL : Insurance cancellation options for travel grow and improve

ED PERKINS

I was recently asked by the U.S. Travel Insurance Association to assess the industry from a consumer perspective, especially regarding new or modified services that consumers would like to see. Here are my main points:
Vacation rentals are becoming increasingly popular with the traveling public, and at least one travel insurance provider has developed a trip-cancellation (TCI) policy especially for those of you whose main concern is protecting your advance rental payments. Vacation Rental Protection — (800) 694-4311, www. vacationrentalprotection. com — charges less for rental protection than you’d pay for a conventional TCI policy — and rates are not scaled by age. For example, insurance for a oneweek, $1,000 rental, bought two months in advance, would cost $44. That’s only a bit less than the least expensive conventional policy for a traveler age 45, but about half of what a retired traveler would have to pay. Moreover, your rate is based strictly on just the rental price, excluding the cost of other trip components, so the final cost could be much less than the price of a conventional policy for a complete trip. So far, the policy is available for rentals in only 14 states, but presumably the insurer will increase the scope as soon as it’s practical.
Many travelers have to cancel trips because of unexpected business requirements, more often than because of sickness or accident. Unfortunately, most TCI policies do not cover business reasons at all. Collette Tours, however, sells a waiver that allows you to cancel for any reason, right up to departure time. You get a full refund (except for the price of the waiver). To be sure, Collette’s policy isn’t quite as comprehensive as a true TCI, and it won’t protect you in the unlikely event that Collette defaults. The waiver is also more expensive than ordinary TCI. Nevertheless, it would be a good buy for any business professionals vulnerable to last-minute schedule changes.
A few other operators offer similar waivers. Lindblad Expeditions provides a slightly different form of any-reason cancellation, as an add-on to rather than in place of regular TCI. It pays off only in credits toward future travel, not cash, and only for cancellations up to 72 hours prior to departure. Either type of waiver would be extremely valuable to many travelers: Let’s hope that other operators or independent insurance companies pick up on this valuable feature.
These days, many of you simplify the process by buying travel insurance through one of the several online agencies that instantly compare a handful of different policies. You can quickly select the best option for your trip, without having to check individual Web sites. Among those are www.insuremytrip.com, www.squaremouth.com, and www.totaltravelinsurance. com. I suspect the insurance companies aren’t terribly happy about this development, but it’s sure good for consumers. And it highlights how much extra you pay for the trivial benefits of a "gold-plated" policy.
Even with some innovations, however, the basics don’t change The first rule of insurance — any insurance, and especially travel insurance — is to buy as little as you need to cover risks you can’t afford to accept. In travel, that means:
Always use TCI to protect any big nonrefundable or only partially refundable prepayments that you stand to lose if you should have to change your plans.
Use TCI or separate travel medical insurance to protect yourself against unexpected medical emergencies that your regular health program doesn’t cover.
Forget about the small stuff — baggage loss, delay and such — that are either low-dollar risks or risks that you already cover through your homeowners’ or tenants’ insurance. If a few minor coverages are automatically bundled with TCI and medical, fine. But don’t pay extra for a gold-plated policy that simply adds a laundry list of low-risk benefits to puff the price.