What is Travel Insurance?
Travel insurance generally refers to insurance designed to cover sudden or unforeseen costs due to medical care, trip cancellation, trip interruption, loss of belongings or other losses incurred during travel.
Why is Travel Insurance necessary?
Needing travel insurance is like needing a parachute.
If it isn’t there the first time, chances are you won’t be needing it again.
I can speak about the importance of travel insurance from a personal point of view:
On January 1st I was a healthy active male in my mid-forties celebrating the New Year with my wife and good friends. The next day I was in the emergency room of a hospital with a doctor telling me I had a very serious life threatening condition.
Completely out of the blue I had developed deep vein thrombosis which resulted in a ‘massive’ saddle pulmonary embolism.
Fortunately, I was in my hometown and close to the best trauma hospital in British Columbia, Canada. A hospital I was a patient in for over two weeks.
I was also very fortunate with my timing. Two days later, we would have been in Miami Florida on route to Honduras. The Medical system in the United States is world class but as a Canadian, it also carries a world-class price tag. The health care system in Utila, Honduras on the other hand is quite the opposite- all I can say is I am very fortunate to still be here.
If this incident had happened in the US the total costs of such intensive care and testing would have been financially crippling, which is why we always have travel medical insurance coverage. We believe that if you cannot afford adequate insurance, you probably cannot afford to be traveling.
Five compelling reasons to carry Travel Insurance
0l. Stuff happens, take a moment to consider what the consequences of any of the below would be.
- Being involved in an accident – planes, trains, automobiles, bicycles or boats
- Developing an acute illness
- Getting bitten by snakes, spiders or mosquitoes carrying infectious diseases
- Sporting accidents while zip-lining, bungee jumping, or scuba diving
- Tripping down the stairs and breaking bones
- Having your luggage stolen along with your passport
- Death – either a family member back home or your own
02. Good health care can be very expensive
- Especially if travelling in North America, Europe or Japan
03. Not everywhere you want to travel has good health care
- Meaning that you may need transferring to somewhere that does
04. You do not want to become a financial burden for others
- A serious incident may not impact your finances, however will it impact your families?
05. Peace of mind
- Things can and will go wrong. The longer you travel the greater the probability
- The last thing you need to worry about is how you are going to pay mounting medical bills
Ask yourself – If something goes wrong can I cover the cost personally without experiencing duress financial or otherwise.
Obviously, some accidents are a pain in the butt, but pose no real cost implications. Going to a doctor for cuts and scrapes or getting your teeth cleaned in many parts of the world is very inexpensive, – in other places, the costs are high, but probably not enough to bankrupt you.
On the other hand, a life-threatening condition, resulting in 2 weeks of hospitalization would most likely cause a major financial setback–if not bankruptcy—without adequate insurance in some countries.
If you had a life-threatening condition in Utila, Honduras – you might be very willing to pay big bucks to get to that Miami hospital.
Besides saving your life or your financial health, travel insurance can also provide peace of mind. However, that piece of mind can cost a lot. The trick is to find insurance that will provide the right level of protection at a cost that will not keep you grounded.
Also, bear in mind that some insurance is not worth the aggravation that goes along with making a claim (insurance companies sometimes kick and scream before they pay out).
The bottom line is this:
If the cost of an unforeseen incident is greater than what you are able or willing to pay out of pocket -or if the cost to your friends or family back home to bail you out is financially crippling – then insurance is a good idea.
The challenge of insurance coverage for long – term travelers
“Life is inherently risky. There is only one big risk you should avoid at all costs, and that is the risk of doing nothing.” – Denis Waitley
We are defining long-term travel as being away from your home base for 6 months or more. Long-term travel does pose additional challenges to the already complicated minefield of travel insurance.
Some of the challenges that travel insurance poses for long-term travel are:
- The travel insurance industry tends to focus on the short-term or vacation traveler
- Typically, travel health insurance has to be purchased before you leave
- Existing ‘primary insurance policies often have severe limitations on coverage when traveling (sometimes offering no coverage at all)
- Many travel insurance policies are ‘secondary policies’, meaning that your provincial or state coverage has to also be in force
- Travel insurance can be very costly for the long-term traveler
- Limitations and complications for older traveler’s and those with pre-existing conditions
- Travelling as a couple or a family under a single policy can be tricky. Some policies may become void when one party returns home and the others continue to travel
These challenges make purchasing and managing cost effective travel insurance much more complicated than that needed for going on a two-week vacation.