Whether you’ve booked the trip of a lifetime or you’re just planning a weekend getaway, sadly there are risks associated with traveling abroad.
Travel agents and online travel services are quick to offer travel insurance policies to protect adventurers. But do you really need to purchase a travel insurance policy when you already have a homeowners, rental, condo, or umbrella insurance? Don’t these policies provide you with adequate protection, including theft and liability issues?
Simply put: Your personal insurance policy or policies most likely protects you to some extent while on a trip but it doesn’t provide all of the coverage of travel insurance.
Travel and homeowners insurance overlaps in some areas but trip coverage is more of a specialized product and can offer more coverage to those who have invested in an expensive jaunt. Guidebook author and TV travel expert Rick Steeves writes that travel insurance may cover many other aspects of a trip, including accidents, illness, missed flights, canceled tours, lost baggage, theft, lost baggage, emergency evacuations, losses due to a travel service you’ve hired that goes bankrupt, and may even cover the cost of your body being returned home if you die. There are typically limits and stipulations but many of the services provided by travel insurance aren’t fully covered by homeowners, renters, umbrella, or even auto insurance for that matter.
But your personal insurance isn’t out of the picture when traveling and many choose to rely solely on this coverage for trips to closer to home or if their travel costs are relatively low. Here’s how your homeowners, renters and umbrella insurance may cover you in case something bad happens abroad.
Theft of personal property
Both your renters and homeowners insurance should cover some of your losses if your property is stolen while traveling. Coverage is typically less than if the loss occurred in the home. Generally speaking, most policies will cover between 50 and 70 percent of the insured value of the home, and some coverage is limited to 10 percent of that if away from the home, according to Bankrate.com. This means that if you have $250,000worth of coverage on your home than your personal property may be covered for up to $125,000. If traveling when the incident occurs, you may be covered for up to (or only) $12,500 in losses. Items like jewelry, expensive fur coats, etc. may not be covered unless you have purchased a rider insurance policy to cover them.
Also, there is typically a deductible made with most claims. So you will have to decide whether filing a claim on a $350 set of golf clubs is worth it if you have a $300 deductible limit.
If you’ve gone on a shopping trip and someone breaks into your vehicle and grabs your newly purchased items, you are probably covered through your homeowners or renters policies and not your auto policy, which usually doesn’t cover contents that aren’t part of the car. Coverage levels and deductibles may also apply.
Some auto insurance companies do offer personal property protection for your car. You have to pay extra for this. Also, if you purchased the items with a credit card, some credit card companies will reimburse you for losses if the items never made it home, according to Bankrate.com.
Your homeowners or renters insurance may cover you for part of your losses if your luggage is lost or stolen. Be prepared to offer an itemized inventory of what was inside the lost bag. The airline may also offer some reimbursement. This may overlap with travel insurance, which also typically covers lost or stolen luggage.
If you damage someone’s property while golfing or you injure someone, your homeowners, condo, or renters insurance most likely will provide liability coverage up to your limits. An umbrella policy offers additional liability coverage if you have more assets to protect.
If you’re planning a staycation or a trip abroad, experts say it’s best to check your policy with your insurance agent to understand what you’re covered for and where there may be holes in your coverage.
Have you had to file a claim or used travel insurance on a trip? Share your stories using the comment field below.