Travel insurance is popular, coverage not so much

Call it hedging a bet, playing it safe or now just part of the deal, more people are buying travel insurance than ever before, and they have some good reasons. Earthquakes, floods, ash clouds, civil and political unrest along with snowstorms, fear of pirates and scary things that go bump in the night all seem to play into making what was commonly a “no” decision a “yes, absolutely” when it comes to buying travel insurance. Buying travel insurance is popular but coverage varies and knowing the details of your policy is important.

“2010 certainly raised people’s awareness of the value of travel insurance,” Dean Sivley, chief executive of the travel insurance company Travel Guard told the New York Times. “Yes, more people are booking travel insurance. But yes, we also paid out more claims in 2010 than would be typical. Hopefully, we won’t have a lot more years like 2010.”

In the past, travel agents hated to mention the topic of travel insurance, viewed as an unnecessary expense or a way for them to “run up the bill.” Now, travel insurance is commonly added automatically if for no other reason than to save time down the line as few have it removed.

But having travel insurance and being covered are two entirely different matters it seems. Many of the feared reasons for cancellations are not covered as some find out the hard way.

“Many people assume that their cheap travel insurance will cover them against every eventuality, but this isn’t the case.” says Patrick Chong Managing Director of Journey’s Travel who operates a commercial travel insurance website, Insuremore in the UK. “There are plenty of exclusions in the average document, and one of the most well known but least understood of these is the “acts of God” exclusion.”

Acts of God include Hurricanes and tempests, Lightning storms, Floods, Earthquakes and volcanic eruptions. Those may or may not be covered but what about civil unrest, political and terrorism events that disrupt travel ?

“While acts of God is one of the most well known exclusion clauses, in today’s international climate, terrorism is also a common exclusion. Much like natural disasters, if you incur costs or your holiday is canceled because of terrorism, your travel insurance may well be invalid. If terrorism is a potential hazard for your destination of choice, check that your worldwide travel insurance will cover you against acts of terrorism – some insurers do provide this kind of protection, but many do not.”

So it’s buyer beware when it comes to travel insurance and just having it should not give travelers the confidence that they are covered in all situations. Check with a travel insurance agent and ask specific “What if?” questions, In the U.S. most states require those agents to be licensed. Be sure yours is.

Best bet: Call the travel insurance company directly to check coverage and deal with a firm that is highly rated. provides editorial reviews, customer reviews, guides, and articles that help you decide which travel insurance to buy for your trip.

Flickr photo by Andrew Steinmetz