Travel insurance policies pack more options
— -- If you're thinking about buying travel insurance, here's the good news: The typical policy covers a lot more than it once did, and companies are rolling out options that offer even more protection.
The bad news: All the new options are making choosing a plan more confusing than ever.
Just last week, one of the largest travel insurance companies, AIG Travel Guard, announced nearly a half-dozen major changes.
For starters, Travel Guard will insure trips that cost as much as $100,000, up from $30,000. The firm also is reaching out to traveling parents by including children ages 17 or under at no additional cost in one of its plans, ProtectAssist.
But perhaps the biggest change at Travel Guard is that for an extra payment equal to 40% of your base premium, it will add a "cancel for any reason" clause to select policies. Customers will be reimbursed for 50% to 75% of the cost of the trip if they cancel up to 48 hours before departure. Until now, customers needed a valid reason to cancel, such as a death in the family.
For an additional $24, customers also can add a "cancel for work reasons" clause to many of its policies.
"We're moving further and further away from one-size-fits-all travel insurance," says AIG Travel Guard's Dan McGinnity.
Such changes are driven by consumer demand, says Peter Evans of InsureMyTrip.com, which compares more than 100 travel insurance plans sold by 18 companies.
Evans says one of the biggest changes the past two years is the addition of language that allows customers to cancel if the destination they're visiting becomes uninhabitable by, say, a hurricane.
Companies also have expanded coverage of terrorist incidents.
"Prior to 9/11, policies were written to cover terrorist attacks in foreign locations but not domestic," Evans says. "Now, if you go through these policies, you'll find they read 'foreign and domestic.' "
The changes can be confusing. But as Evans notes, the typical package policy is less daunting to understand if you break it down into its parts.
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