Do I need travel insurance if it's included with my credit card?
Travel insurance might not be the top of your list of things to buy in advance of your big trip. Between shopping for vacation clothes, and saving money for the stuff that really matters (i.e good food, fun activities and memorable souvenirs, of course) travel insurance is quite often neglected.
Many credit card companies offer travel insurance as an additional add on or reward for customers, and lots of travellers think this will be enough to cover them. Some coverage is better than no coverage, right? However, what might seem like a pre-vacation saving could end up costing you more in the long run, if you don’t check the fine print of your credit card coverage.
What travel insurance comes with my credit card?
The first step in deciding whether you need to purchase additional coverage is to check with your credit card provider about what exactly their travel insurance covers. For the most part, credit card travel coverage will include the basics- that is trip delay and/or cancellation, baggage loss and emergency medical coverage. For some people, this may be more than enough. Alternatively, the free coverage provided on your card could allow you to tailor any additional coverage to fit your exact needs and save you big bucks.
How do I know if I need more coverage?
The bad news about travel insurance provided by your credit card is that it is a “one size fits all option”. That means that it hasn’t been tweaked to fit your unique travel needs. There are a variety of factors that could have a severely impact on your wallet if you end up having to make a claim.
Pre existing medical condition
A lot of people worry that they can’t get insurance as the result of a pre-existing medical condition, however this is just a myth. While a pre-existing condition will affect the amount of money you have to fork out, it isn’t impossible to find adequate coverage. However, if you do have a medical condition it is vital you find an appropriate policy, emergency medical won’t cut it if you aren’t honest from the get-go about your health.
Age
Unfortunately, age does have a part to play when it comes to travel insurance policies, and the standard package offered by your credit card might let you down at the last minute if you fall into a higher age bracket. Insurers tend to separate age into three categories. Those aged 60 and under pay the least. You may see a slight rise in cost if you’re aged between 60 and 70, however it is the over 75s who will see the most noticeable increase in cost. Luckily, different insurers have different policies, so it is always best to search around for the best policy for you.
Length of trip
Are you going on a business trip for a long weekend in New York or spending the winter months in Florida? How long you are travelling for can play a huge role in how much coverage you need. The theory is, the less time you are away, the less likely it is that you will be faced with any unexpected emergencies. If you are travelling for more than a couple of weeks, or plan on taking multiple long distance trips over the course of the year, it is a good idea to consider purchasing an annual insurance plan. While your credit card may have you covered for the small stuff, an annual plan will save you money on setting up small policies tailored to the specifics of each trip. Additionally, you can rest easy knowing you have the right amount of coverage for your journey.
Destination
For the most part, it doesn’t matter if you’re going to Europe or Asia, travel insurance will cost the same. What does matter is whether you are travelling domestically or internationally. If your trip is only taking you to the west coast, then your provincial insurance could have you covered for a lot of things. However, if you need to seek medical treatment in another country, you could be faced with a hefty bill to top off your vacation. Even if your trip is domestic, make sure to check the details of your provincial health care, as coverage varies province to province.
Extreme sports add-on
If you’re planning on bombing the slopes at a winter sports resort, or ticking one off the bucket list and going bungee jumping, then the basic insurance from your credit card won’t cut it. When it comes to any kind of extreme sports, appropriate coverage is necessary and you must disclose your plans to your insurer. Most insurers offer specialist plans or an add-on for those embarking on a sporty vacation.
Baggage value
Most complimentary coverage from credit card providers does include baggage loss or damage, however make sure you know how much they are willing to pay out. For a weekend bag with just your basics it’s probably enough, but if you have any expensive clothing, jewellery, technology of specialist equipment, then you probably want to take out a seperate policy with a higher coverage.
Generally, while your credit card coverage will cover the very basics, it is best to spend a little extra up front and make sure your plan is tailored to your specific needs, to save money later on. Different companies will offer different deals, so the key is to do your research and find the deal that best fits you.