The Dangers of Buying Cheap Insurance
You’ve seen the ads — “Travel insurance you can count on at prices you'll love.” Or, “We cover trip and flight cancellation, hospital bills, money and baggage, and repatriation.” All these claims are then followed by a figure that seems too good to be true. And happy to pay such a small price to get covered for your travel adventure, you go ahead and buy cheap insurance.
Cheap travel insurance can be costly — yes, you won’t pay huge premiums, but your insurer might end up refusing to cover your cancelled flight, or lost baggage. The last thing you want is to find yourself stuck with a hospital bill in the $10,000-$50,000 range, and unable to claim your money back from your insurance provider.
Not quite a brilliant scenario, right? Below we’re discussing the reasons why you should never buy cheap travel insurance.
It Might Not Be Real
Any figure under $100 may seem too good to be true. We’re talking about travel insurance after all — and indeed, many so-called insurers sell fake travel insurance that obviously doesn’t provide any sort of coverage. You’ll end up saving a few dollars on premiums only to realise you’ve bought a bogus travel insurance policy that won’t cover anything.
Do - Stay away from brands that advertise on the sole benefit of "cheap travel insurance". You’re better off buying insurance from a reliable provider, paying a reasonable premium, and getting the coverage you need.
Don't - Rush to buy through a travel agent. Your agent may only offer a few plans, and a travel insurance company will have more options to compare.
You May Be Underinsured
Often, insurers that sell cheap travel insurance policies put many so many restrictions that barely anything is covered. For example, British Airways offers rescheduling until June, but if you can’t travel by then and want your money back, the answer is “no.” Even if there aren’t many restrictions, the amount of coverage you get may be so small that it might feel worthless.
By choosing to buy insurance from a reliable provider, you’ll know that, when the unforeseeable happens, you’ll be fully covered — whether it’s about a delayed or cancelled flight, lost luggage, or a hefty medical bill.
Do - Ask about items that are most important when it comes to levels of coverage, such as emergency medical coverage, forms of claim payments (cash or future travel credits?), and cancellation clauses.
Don't - Assume that your travel agent offers the best insurance available.
Your Claims Might Be Paid at a Snail’s Pace
Seriously — some insurers are notorious for paying claims at a snail’s pace, and even become a little stingy when it comes to returning some of the money to the customer.
It’s your right to get your money back once you’ve made a claim, but some insurers that sell cheap travel insurance just won’t honour it. Take extra precautions and go with a reliable insurance company for your peace of mind.
Do - Ask about hours and time zone coverage for the carrier. If you have a problem during non-traditional business hours, how soon will help be available? Can you submit claims online?
Don't - Don't buy travel insurance from a company that does not offer insurance for lost luggage. Unfortunately, lost luggage is a common part of travelling, and a reputable carrier will offer this coverage.
Customer Service Is Poor
It happens all the time — customers buy cheap travel insurance, want to make a claim, but just can’t because of the poor customer service. Sometimes, it takes so much time to make the claim that many policyholders simply give up the idea — which is, of course, what cheap insurers want. When your premiums are really cheap, your insurance company may be unwilling to provide any assistance when making a claim, and be so hard to reach that you just can’t make your claim anyway.
Do - Confirm the existence of a customer support team prior to purchasing a policy. Call or email the company, how long does it take them to respond?
Don't - Buy coverage from a provider who does not offer online support. Cell phone charges can add up, and if you didn't set up a specific plan for travel, having the option to submit claims online can be very helpful.
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