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Do You Need Travel Insurance?

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Although travel insurance may seem like a good idea, does it make the most financial sense for you and your budget? It can be great to have peace of mind if you get injured while you’re traveling or if you suddenly lose your bags while you are at the airport, but insurance is also a losing proposition for many people who are purchasing it. Travel insurance also has a lot of exclusions. If you want travel insurance, you need to be on your guard when you are selecting it, otherwise it may be more of an issue than a comfort.

Travel insurance is a short term policy where you are paying a fee in exchange for the insurance company’s promise to pay out to you in case there is a specific travel related problem. For a small cost like delay, you will be asked to pay out of pocket and get reimbursed later. However, for large costs like medical expenses, the insurer may be willing to pay directly. It varies depending on your policy.

You buy travel insurance just for one trip instead of making ongoing payments. However, most people still lose money on the investment that they make into travel insurance. Insurance companies are able to stay in business because people pay a lot of money in premiums in comparison to what they get back in claims. You won’t recoup any of your losses. The reason to get any type of insurance is because although you are losing a small amount of money, the risk of losing a lot of money or your properties is far worse.

There are two types of travel insurance, which are known as international and domestic insurance. International travel insurance covers medical expenses usually and is more expensive. Domestic travel insurance generally doesn’t cover medical expenses and is much cheaper. There are also varying levels of coverage. Most policies are able to cover issues with baggage, missing a flight, trip cancellation, or other related issues. They can also cover the return of a minor, the hotel or airline closing down, traveling to high risk countries, and medical emergencies that provide coverage.

If you’re looking for free travel insurance, you might want to check out some of the rewards that are provided by your credit card. For those who want travel insurance and don’t mind paying a cheap price, there are options such as organizations like AAA and AARP, travel insurance for students who are studying abroad, and employees who are on business travel and have the insurance covered by their employer. Some people feel that travel insurance is redundant because you might already have many aspects that have been covered by health, care, or life insurance. There are also many limitations and exclusions on travel insurance which may make it the least ideal option for you to invest in.