No matter what time of year you might be traveling, consider the benefits of travel insurance. Chuck Hembree breaks it all down for you in "Travel Insurance 101".
Below is a transcript of the episode, modified for your reading pleasure. For more information on the topics discussed in the episode, see the links at the bottom of this post.
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Grant FINLEY: Welcome to Your Insurance Connection Podcast. Thanks for listening. I'm your host, Grant Finley, and joined once again by President of CLH Insurance, Chuck Hembree. Chuck, how you doing today?
Chuck HEMBREE: I am doing fine, Grant. Thanks for the opportunity to speak again to our folks.
FINLEY: We certainly love having you here. You're full of knowledge and insight but today's topic - you know, Christmas is around the corner. Teachers, students, everybody's got a break, usually around this time of the year and some people like to take vacations when the weather's cold and they've got some time off, so I thought travel insurance makes a lot of sense if you're going down on a cruise, or you're going to mexico, or even if you're going to Europe. Who knows where you're going? But you've got an opportunity to take a trip, so why not? So, having said that, can you just give me a basic oversight of what travel insurance is? It sounds pretty simple but I'm guessing there might be some layers to it.
HEMBREE: Well, that's exactly right, Grant, and you know if you're just traveling across town you don't need a travel policy but because it is a specific policy it's got a specific purpose and I think it's great that you've brought it up and we have a chance to discuss when you need travel insurance and what does it cover? Why doesn't my regular insurance policy cover that? Why do I need to buy something else? Travel is expensive the way it is and now you're telling me I need to have something else. Well, travel insurance is not that expensive, so we want to dispel that myth right off. I guess expensive is in the eye of the beholder, but if you don't know what the cost is then you need to inquire so you really can see how affordable it is and see how it impacts your plans. Travel insurance provides us with some coverages that our normal insurance doesn't. If we looked really intently at a policy, any policy, generally it has a territorial provision. That territorial provision says, "This insurance is good in the United States, its territories, possessions and Canada". Well, why does it have that territory provision? Why are we being so stingy with our coverage? Well, generally because insurance is a legal contract, so markets really want to make sure that if it's taken to court, because that's what happens when we have an infraction, that it will be interpreted the way that the writers intended it to be. Quite frankly, personal injury in Canada and the U.S. are looked at pretty much the same, but personal injury in Singapore may be a completely different thing. We've heard about how cane whipping is legal over there. So, they'd look at personal injury in a different way than we do in the U.S. and Canada. So, in those areas where we feel pretty good about the legal climate and legal interpretation, we don't have any problem. So, what happens when we go outside of that? Will our insurance respond? Most of the time it does not or not in the way that we need it to. So medical, or trip, insurance was developed to fill in some of those gaps when we go outside the range of the insurance policy. It covers things like medical coverage in a way that your own medical policy may not provide, it gives us some foreign liability or can give us some foreign liability in a way that our insurance and our personal liability doesn't provide. I mean, it's just as easy to knock over someone and break their hip at a store in Germany as it is over here at a store in the U.S. and when that person wants you to take care of their injuries, especially if it's on the business side, how is your policy going to respond or will it respond? This allows the trip insurance to respond to those types of things. It responds to circumstances that we don't think about. Many times, particularly in this agency since we work with social services, churches and ministries, we have people that go on mission trips all over the world. They are exposed to exposures that they're not going to necessarily see in the U.S. and if there's a circumstance that happens it's not as easy to respond medically, as it is in this great country in the U.S. where we have wonderful resources all around us, medically and emergency-wise. We may not find that in the middle of Africa or down in Haiti. So what happens when somebody gets injured in Haiti and it's serious? Well, we can't just take them over to the local Med-Stop or Walgreens. Those types of resources aren't available so we have to be able to respond to someone that is hurt on the field or overseas - they have a heart attack, they get sick, they develop the flu, and we can hand them our Blue Cross Blue Shield cards all we want to and they'll laugh in our face because they want the cash now! And a trip accident policy has the ability to respond to that need and then, when we get back home, our medical policy can respond to that in a reimbursement way but we need to deal with the problem over there. It also picks up some things that we don't think about at all. When tragedy strikes and we have to be evacuated. Well if we're overseas, what do we do? They don't just put us up first class with an intravenous needle and pole. We can't do that. There has to be a special evacuation and that's very, very costly. Most of the time, it's no less than $30,000 because it's got to be a medevac aircraft and equipment. So where's that $30,000 going to come from? Well, it's certainly not going to come from your medical policy. Your homeowners isn't going to respond. There's no policy out there. These do it for just pennies. If I can give you a rounded figure - let's say you're going for a week overseas or out of the U.S. and it's just you. Generally, you're going to pay $100 or less for this type of coverage. Most of it I see around the $50 range but some are expensive trips and they may cost a little bit more. Another idea that people don't think about is, what if the unthinkable happens and we or a loved one has to be repatriated back to the U.S. because they died on their trip? Very expensive to do. There's customs at both the place where they passed away and back to the U.S. We can't just put the body on a plane and fly them back. Again, those are very expensive things; very inexpensive to insure so that you have the peace of mind that if something does happen, with trip accident we can respond quickly, that you've got good resources that will help you and, although it may not be the most pleasant experience, it's not one that just bankrupts you and ruins your entire life.
FINLEY: Certainly some good information there. Things that I wasn't aware of. What about if we pull back a little bit and look at your luggage or your possessions or something stolen. Is that going to be a travel insurance, especially if you're overseas, or is that...?
HEMBREE: Your homeowners does not have a territorial provision. It's the only policy that doesn't for belongings. So if your stuff gets stolen overseas it's going to be taken care of. But what are you going to do in the mean time? The travel policy can respond by giving you some upfront money so that you can replace those items so it doesn't ruin your trip. My wife and I and my daughter went to Serbia on a mission trip not too many years ago and, it wasn't stolen, but somewhere in Paris when we were making our connection, they lost our luggage. Now, we had prepared just like the trip insurance stuff tells you about - take an extra day of clothes and so forth, but what if it takes three days, like it did for us, to get the things to us? Well you've got to have clothes or else wear the same ones over and over and I had ladies with me so they had their cosmetic stuff and other things - curling irons and so forth. There were different things that needed to be replaced. Well, this gave us the funds to do it. Plus, were we going to receive them back? What if we never did? It would pay for new luggage because we have to bring back the things that we do have there. So there is baggage and personal effects lost coverage or delay of coverage. You miss a leg of your trip or your cruise because of other travel arrangements falling through - there is some protection for that. There's kidnap and ransom coverage that can be taken care of. There's trip cancellation and interruption coverage that can be provided. All those things can be provided in this trip policy. One of the amazing ones that can be provided in many of these policies is safety and security evacuation. We have the facilities that if you would get into an unsecured or insurrection in an area that you weren't thinking was going to be dangerous, where we can actually bring in safety teams and provide safety evacuation out. We've had to do that with some of our businesses who were having to work in some semi-unsafe areas. That's one thing you'll have to think about when planning your trip. If you're going to an unsafe area, perhaps in the middle east, you'll need to check see if there are any prohibitions on you going there. Because if there's a U.S. government prohibition, you generally cannot find or buy travel insurance to that area. Most of us are not doing that, but occasionally there are businesses that have to respond in those areas and we can work with you on that. And then there's other great resources even before you leave. Trip planning resources that come with these services. You can locate the medical places where you're going so that in advance if something happens or if you have a health condition, you'll know how to respond and where to go. All of those are in a travel policy. Great resource. Very inexpensive. Good way to be thinking.
FINLEY: So you touched on price. I've got two questions for you here before we wrap it up: price, I imagine, and you can correct me if I'm wrong, is probably going to be dependent on, like you said, how long you're gone, probably where you're going, what you're going to be doing, etc. and my only other question then is, are there limitations to this? Do I have to buy a certain amount of time before I leave? I imagine you wouldn't be able to buy it once you're gone. You know, run into problems then buy the coverage, so how does that work?
HEMBREE: Well, generally most companies can respond pretty quickly but you want to do this ahead of time. Don't risk that you don't have your trip ID card before you leave. Although, we can sometimes accommodate that if you do because we can deliver it to you electronically. Preferably, you want it a month out. Contact your insurance agent and start having them inquire. That way you're not surprised by the price or the coverage or not the availability to get the resources to you, the cards and so forth, before you leave. That way you'll feel more ready and your insurance agent will feel more ready that he's done a good job for you if you'll act in advance. But we have had circumstances where we had to provide it with one or two days of notice and we were able to respond but it's not the best way to respond.
FINLEY: Stressful I'm sure.
HEMBREE: Yeah. As far as cost, you're exactly right. Depending on what you want. Some people - look, they're not interested in the repatriation. Maybe we think it's smart but they don't see that as a big need; or evacuation. They're not worried about luggage delay or anything. All they want is the medical coverage while they're out. Well, we can do that. We can provide just that medical and it's kind of based on how old you are. If you're 71 and traveling now, you do have some more health risks than if you're 35, but they're not hugely more expensive but there is a difference in price so you need to check that out. The amount of coverage that you want. Do you want the bear minimums or do you want to make sure that you're protected pretty highly. And if you don't have very good insurance or if you don't have a bank account that you can't wait for reimbursement once you get back to the U.S. then you're probably going to want some of those higher limits. Again, we're not talking about tons of money, $100 or less. Unless you're going on a month long or we've seen some two month trips - those are going to cost you more. But for what most of us can afford in affording the trip, we'll also be able to afford the medical and trip insurance.
FINLEY: Well, if anybody out there is planning a trip this holiday season, you're certainly encouraged to give us a call and we'll answer any questions you might have and hopefully we can help set you on your way and help provide a wonderful experience that you'll be able to remember for a long time. Unless there's anything else, Chuck, I think we might be able to wrap it up with that.
HEMBREE: That sounds good. I will add one more thing that I failed to mention. Your auto insurance doesn't cover outside the U.S. too, so if you go down to Mexico, they have way different laws. You may not have coverage so you may need trip coverage to help you with that. We can and have the resources to do it so that you have a pleasant trip while you're gone because we want you to enjoy it. If you've got to take time away and have some downtime, we want it to be enjoyable.
FINLEY: Absolutely. Alright, thanks everyone for listening and we will catch you on the next episode.
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