Travel Insurance

Written by: Colin

​I spent 3 full days shopping around for travel insurance ruining my recent lasik by pouring through countless pages of fine print. I had at least 50 tabs open to try to compare information but ultimately turned to good ol’ fashioned paper and pencil and cold calling the companies. In this post, I’ll cover how we chose our insurance, what level of coverage we chose, and pitfalls that I’d love for you to avoid. A strong word of advice is to become extremely familiar with the fine print of the plan you end up choosing because if you do not follow their terms and conditions perfectly, you will be left with the fat bill.

 
Spoiler
We ended up purchasing 2 different plans. For travel medical insurance, we chose IMG’s Patriot International plan with a $500k limit, $0 deductible, and the Adventure Sports package add on. For personal property insurance, we chose USAA’s tailored renter’s insurance.
 
A brief case for purchasing travel insurance
I’ll be a bit harsh and say you are dumb not to purchase travel insurance. With all the time, effort, and money you’ve poured into orchestrating an extensive trip, an injury, sickness, or the loss of your gear can easily kill everything. For about $125 per month, we’re both fully covered for any big problems on our trip. Bottom line, this should be considered a required cost for extended travel.
 
Determining the type of coverage you need
There is a sea of companies offering a dizzying number of insurance types. The devil is certainly in the detail and unfortunately, I did not find any comparison site that adequately compared options or offered unbiased critiques. Here are some factors to decide to help narrow down the field.
 
Duration of coverage is a key factor and can be broken into short term (<1 month), mid length (<6 months), and long term (6+ months). Some plans are geared towards the big spending short term traveler and the plan’s benefits are sweeter and best for a strict schedule traveler with a lot of prepaid, upfront expenses. The mid length traveler plans scale back some benefits and assume the traveler has a bit more flexibility in their schedule. Long term plans assume even greater flexibility in a traveler’s schedule and offer plans that can be purchased to cover 12 months at a time. Many companies target certain segments only so for a long term trip like ours, their plans were either astronomically expensive or only available for 2 to 3 months at a time. I certainly did not want to have to buy new coverage every 2 months.
 
The second major factor to consider is whether you need trip cancellation coverage. This means that if you have paid for a good chunk of the trip before going and some unforeseen problem arises that causes you to cancel the trip, those prepaid, non-refundable expenses will be reimbursed. This coverage is quite expensive and significantly drives up the overall cost. For Sara and me, we want to be flexible and aren’t in a rush, so we do not book much in advance and if we had to cancel something, we wouldn’t lose much. Top of the line Cadillac insurance plans typically include trip cancellation insurance but your overall cost can double and even triple.
 
The next factor to consider is the total coverage and deductible. Emergency evacuation, long term hospitalization, or extended illnesses can get extremely costly. I read many articles on the topic and the consensus is that travelers should have a minimum of $100k total coverage out of their travel insurance. In the plan we ultimately chose, the most advantageous price point was to increase our cost by $8 per month to increase our total coverage to $500k each. Deductibles also have a dramatic effect on overall cost and typically range from $0 to $2,500. Plans with $0 deductibles were about twice the total cost of plans with $2,500 deductibles but filing one claim would be almost 4 times the cost of the insurance itself. Unfortunately, few companies give you the ability to choose different coverage levels and deductibles, therefore requiring you to shop around a lot between companies.
 
Lastly, I wanted insurance that would cover Sara and me in adventure sports like diving, mountain biking, spelunking, parasailing, skiing, etc. These sports come with more risk so many companies do not want to get into this market. This requirement significantly narrowed down our list of options.
 
Comparing companies and plans
There is no easy way to compare insurance companies and their plans. In addition, the water is muddied by biased reviews and guerrilla marketing. One company in particular, World Nomads, appears to sponsor many travel bloggers to write glowing reviews of their service. Oddly, the only positive reviews were in syrupy sweet posts on travel blogs that also had blatant advertising banners for World Nomads. Outside of these high profile blogs, every other public review source had nightmarish reviews of the company’s poor performance and service.
 
However, reviews must be taken with a grain of salt because there’s not much impetus to write positive reviews online and the insurance industry operates on the slim chances that the insurance will ever be needed. As a result, most customers pay for the insurance but never use it. The small percentage of folks who do use it have bigger concerns than posting a review of the service online. Generally, the reason you’d post a review is if you had a poor experience and the worse the experience, the more likely you are to post a review. Positive reviews are rare but to me, hold more weight.
 
World Nomads has a slick website and easy interface, is endorsed by Lonely Planet and National Geographic, and underwritten by Nationwide Insurance. I thought they’d be the easy choice until I started to dig through online reviews. The horror stories in these forums scared me. As a result, I entered this pattern where I’d read terrible reviews about World Nomads then turn to the headache inducing task of trolling other insurance companies’ websites, give up after making no progress, return to World Nomads and find a new forum of even worse reviews, then troll through more confusing websites and fine print to compare other companies. I completed this cycle 5 or 6 times until I finally picked up the phone to go over coverage options line by line. Note that there are plans and great addons that aren’t listed online.
 
By this time, I’d tossed out World Nomads as a brilliant advertising company but terrible insurance company. After calling a few, IMG came out on top by meeting all our essential criteria and allowing customers to choose coverage limits and deductible amounts. However, the hang up was that their plan didn’t cover any personal property from theft and had far too low of reimbursements for lost luggage. Our life is in our packs so losing these puts a big dent in our travel plans.
 
At this point, I began researching personal property insurance. Many companies shy away from insuring electronics since they are prime targets for theft and easily damaged. It was easy to find companies willing to insure our stinky clothes and dirty packs but insurance for electronics was rare and expensive. Luckily, we’d already bought accidental damage insurance for our major electronic items so renter’s insurance was a great option since it covers theft but not accidental damage for all items we’re traveling with. My easiest option for renter’s insurance was to stick with USAA which I’ve been happy with for the past 6 years.
 
As a result, with IMG covering our travel medical needs, and USAA covering our items, I sincerely hope our bases are covered. I also hope to never have to use either plan but if we do, I’ll update everyone on how each company performs and post a review online...