Before Stefan Mitrovic booked his holiday flight from San Francisco to Miami, he asked: Do I need travel insurance?
And that's when he remembered his luggage.
"I'm taking some valuable Christmas presents with me," said Mitrovic, who runs an internet consultancy in Los Angeles. "I was afraid they might get lost on the flight."
This holiday period will be different from any other, said Harding Bush, manager of security operations for Global Rescue, a provider of travel risk management services.
"More people are traveling," he said. "Airlines have staffing issues. And it's a challenge for them to handle the surge."
In other words, your holiday trips are more likely to be canceled or delayed than last year – and maybe ever before.
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Do you need travel insurance for your holiday trip? This is the time to find out. Travelers typically buy insurance to protect their expensive international trips. But since the pandemic, they're buying more policies than ever. Is holiday travel riskier this year? And what type of insurance should you buy?
Mitrovic just wanted to cover his luggage. The U.S. government caps your airline's liability for delayed baggage at $3,800 for domestic flights. But the claims process is difficult, and airlines exclude many items from coverage. He found a policy through Travelinsurance.com that covered his checked luggage for up to 75% of its current market value.
Experts say Mitrovic did it right. He weighed the risks of holiday travel and then bought a policy that covered him.
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"When it comes to travel insurance, there's no one-size-fits-all policy," said Daniel Durazo, a spokesman for Allianz Partners USA. "It's all about your individual specific needs and concerns about where you're traveling to and what financial investments you'd like to protect."
Those concerns can range from minor inconveniences, like a delayed suitcase, to major issues, like last-minute trip cancellation or medical emergency.
Do you need travel insurance for your holiday trip?
The conventional wisdom is that a travel insurance policy is unnecessary for quick domestic trips – the kind most often taken during the holidays. That's because insurance only covers prepaid, nonrefundable trip components. So driving to your aunt's for a holiday weekend is most likely not insurable.
But for other trips, you may need a policy. Usually, people consider insurance when they're spending more than $2,000 on their trip. But insurance can also cover unanticipated expenses, like a flight cancellation.
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"The cost of last-minute flights can be 10 times higher than the initial purchase," said Manny Fernandez, vice president of Global Operations at CAP Travel Assistance. "Having peace of mind for trip interruption or cancellation is important as trips are being canceled more frequently."
Dan Skilken, president of TripInsurance.com, said if the holiday season is a replay of this summer, insured travelers will have an edge. Consider weather delays. Airlines don't have any obligation to help travelers. "There is no reason to spend the night in the airport, since the cost of your delay is covered," he said.
Weighing the risks of holiday travel
Holiday travel is also more dangerous than it has been in past years, according to experts. Geopolitical tensions in Eastern Europe, Israel and Asia are making travel to those areas riskier, said John Gobbels, chief operating officer for the air medical transport and travel security company Medjet.
But also consider what you will be doing at that destination. A beach vacation in Mexico might be less risky than heliskiing in Canada.
"When choosing your travel insurance, you need to consider several factors such as whether you're traveling domestically or internationally, your trip cost, if you're doing adventure sport and if you're bringing your own gear," said Christina Tunnah, general manager for the Americas at World Nomads.
Travel insurance companies now allow you to customize your policies. Sites like InsureMyTrip.com and battleface.com allow you to add or remove coverages until you have the exact policy you need. For details on the best policy, check out my free guide to buying the best travel insurance.
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What should you look for when choosing insurance for your holiday trip?
During the holidays, the two big coverage areas for travelers are medical and trip cancellation, said Pallavi Sadekar, head of operations at VisitorGuard.com.
"Medical insurance, especially HMO plans, may not cover you for medical emergencies for trips outside the country," she said. "Travel insurance can protect you if you become ill or have any injury."
She said trip cancellation plans can reimburse you for prepaid, nonrefundable trip costs when you have to cancel for a covered reason. That way, you get your money back and you can book your vacation for another day.
That's what Harry Wenkert is looking for when he buys a travel insurance policy for his holiday trip. "The coverage that we are most interested in is medical services, medical evacuation and trip cancellation," said Wenkert, a retired pharmaceutical industry marketer from Pittsburgh. He's headed to the Canadian Rockies later this year and he already has his policy picked out.
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What type of travel insurance should you get for your holiday trip?
A regular travel insurance policy will cover you for the duration of your trip. If you think you might have to cancel, you might also consider a "cancel for any reason" policy, which allows you to cancel your trip for any reason and recover 50% to 75% of your prepaid, nonrefundable expenses.
But for Mark Beales, a retired mortgage banker from Mill Creek, Washington, the uncertainty of the last two years led to a New Year's resolution to buy travel insurance.
A friend was visiting her relatives in Canada for the holidays. She didn't buy travel insurance. "She fell and ended up in the hospital and then a rehab center," he recalled. Then she had to pay for medical transportation back to the States.
"The cost was ridiculously high and wasn't covered by Medicare since it occurred in Canada," Beales recalled. "So our friends paid out of pocket for those costs."
He resolved never to be without travel insurance. So instead of purchasing a policy for every trip, he decided to get an annual travel insurance policy.
You may not need travel insurance for your next trip. But for this upcoming holiday travel season, you should probably consider it.
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Avoid these travel insurance mistakes
Chris Carnicelli, CEO of Generali Global Assistance, said travel insurance can be a smart purchase for your next trip, but many travelers make mistakes when buying their coverage. "It’s still a foreign concept for many," he said. "The most valuable piece of advice that I can give to travelers is to do a little research and avoid making assumptions about who and what is covered."
► Don't wait to buy insurance: "It's a good idea to get suitable trip insurance well before your travels," said Rajeev Shrivastava, CEO of VisitorsCoverage, an insurance marketplace. For example, for some policies, you must buy travel insurance within 14 days of making your initial trip deposit to get coverage for a preexisting medical condition.
► Don't forget to read your policy: Many travelers don't know the common travel scenarios in which they qualify for reimbursements if they have travel insurance. "That includes flight delays and lost luggage," said Lauren Gumport, a spokeswoman for Faye travel insurance. "Make sure to read your policy and if unclear, call your travel insurance provider pre-trip to find out."
Read it all the way through. Lauren Gumport, a spokeswoman for Faye travel insurance, said her company has seen many customers who don't understand their policy. "I've noticed that many travelers don't know the common travel scenarios in which they qualify for reimbursements if they have travel insurance," she said.
► Don't buy the cheapest insurance: It can be tempting to either skip travel insurance or buy the cheapest policy for your holiday trip. "But by doing so, you're putting yourself at risk of not having the right travel insurance when you need it," warns Angela Borden, a product marketing strategist with Seven Corners. "During the holidays, when the chances of flight cancellations, lost luggage, and other unexpected events increase, protecting the money you spent for your trip becomes even more important."
Christopher Elliott is an author, consumer advocate, and journalist. He founded Elliott Advocacy, a nonprofit organization that helps solve consumer problems. He publishes Elliott Confidential, a travel newsletter, and the Elliott Report, a news site about customer service. If you need help with a consumer problem, you can reach him here or email him at firstname.lastname@example.org.
This article originally appeared on USA TODAY: Holiday travel insurance: What to know before choosing coverage