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TODAY contributor
updated 12/13/2007 11:45:13 AM ET 2007-12-13T16:45:13

It remains one of the more confusing aspects of travel — insurance. But with growing delays and cancellations, and with what seems to be an increasing number of ways to interrupt — or postpone your trips, insurance is now something to seriously consider.

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And a lot of American travelers are doing just that.

Sixty-seven million Americans spent $1.3 billion on travel insurance in 2006, which is a 20% increase from 2004.  

There are several basic reasons to purchase travel insurance.  But the top three reasons to buy travel insurance are: peace of mind, protection against the unexpected, and concern over losing the financial investment in a trip. The more you have to lose, the more helpful insurance can be.

These reasons become even more meaningful when you’re traveling with your family, because there is that much more chance of something going wrong. If your kid gets a cold or an ear infection, you may not be able to fly; if your flight is delayed, guess who has to feed them? If a family of four is traveling, it only takes one lost suitcase to ruin a vacation. 

When choosing what kind of plan is right for you, there are a number of important options to consider/. Some companies offer comprehensive family plans, and may include kids for free (it’s all bundled into one big package). Or you can pick and choose what kind of coverage you want and pay on a  per person basis: trip delay or cancellation, medical evacuation, rental car damage, even baggage coverage.

Here's how many insurance policies work:

AIGT Travel Guard
Just this past fall, AIG Travel Guard introduced a new family coverage enhancement to its ProtectAssist travel insurance plan (its most popular plan).  With the new family coverage, children aged 17 and under are now covered at no additional charge if they are related to an insured adult under the ProtectAssist insurance plan

The cost of travel insurance generally runs between 5-7 percent of the total trip cost, and depends on the age of the policy-holder and the trip cost.  For a family of five (with three children aged 17 and under) going to Aruba for a week with trip cost of $1,500 per person, travel insurance with ProtectAssist would run approximately $71 per adult (for adults aged 37 and 42).  To purchase separate premiums for the children would have been at least $55 or so – so the savings with the ProtectAssist plan in this instance would be between $150-200.

Travel Guard’s ProtectAssist family plan also includes:

  • Trip Cancellation: Up to $100,000
  • You can cancel for any reason: Reimburses 50-75% of the trip cancellation penalty (based on plan purchased) if the insured cancels a covered trip for any reason, up to 48 hours prior to departure.  Cancel for Any Reason, which must be purchased within 15 days of initial trip deposit, is offered as an optional, add-on coverage to Travel Guard’s Cruise Tour & Travel, ProtectAssist and My Travel Guard insurance plans.
  • You can cancel for work reasons: For travelers who may unexpectedly be forced to cancel a vacation due to work obligations, Travel Guard now offers an optional package of trip cancellation coverages for work-related reasons.  For travelers who don’t need to cancel their trip but may be required to work while on vacation, this package also includes “Business Assistant” services*, which offers emergency dictation; business correspondence assistance; “411” global directory service; wireless accessory replacement assistance; and more.  The Cancel for Work Reasons option is an add-on to the Cruise, Tour & Travel, ProtectAssist and My Travel Guard insurance plans.

Some other liability/payment limits:

  • Trip Interruption: The policy pays up to 150% of trip cost
  • Travel Delay: $750
  • Missed Connection: $250
  • Kids age 17 and under : free
  • Medical Expenses: Up to $50,000
  • Emergency Medical Transportation: Up to $1,000,000
  • (Additional) Evacuation home or to hospital of choice: Medical Evacuation Home — Emergency medical evacuation home or to the hospital of choice is now an optional upgrade available on the Cruise, Tour & Travel, ProtectAssist and My Travel Guard travel insurance plans.
  • Lost, Stolen or Damaged Baggage: $1,000
  • Baggage Delay: $300
    Accidental Death and Dismemberment: $25,000
  • Flight Accident Coverage: Up to $500,000
  • Car Rental Collision Coverage: $35,000

Acess America
The Family Basics Plan
Like AIG, kids are covered for free.

  • Covers up to $10,000 in non-refundable costs.
  • Trip Cancellation Protection: Up to amount purchased
    Trip Interruption Protection: Up to amount purchased
    Emergency Medical and Dental Benefit: $20,000
    Emergency Medical Transportation: $100,000. They will take you to the closest facility for what your needs are. They work with Mondial Assistance group, the largest travel assistance in the world. They send doctors out to the hospitals and clinics around the world, so Access America is “confident” that they’re sending you to the best facility for your needs. You can see pictures of these facilities, and Access America rates them on how close they are to Western standards, how clean, etc. 
  • Baggage Coverage: $750
  • Baggage Delay Coverage: $200
  • Travel/Trip Delay Coverage: $500
  • Collision/Loss Damage Insurance: $25,000

Medjet Assist
This is one of my favorite plans. WIth many other insurance plans, medical evacuation and repatriation coverage usually involves the insurance company making the determination as to where you will go — it's their choice. WIth MEDJET ASSIST, they will fly you back to the doctor and medical facility of YOUR choice. Big difference. This is the one coverage you hope you never have to use, but it's also the one card you need to carry.

  • If you opt for emergency evacuation and repatriation, it doesn’t cost much to add on your entire family. For a one-year membership, the individual pays $225, and families are $350. A three-year individual membership is $615 and family is $930. Five-year individual membership is $950 and family is $1,450. 
  • MedJet’s Plus membership adds on secure online storage and maintenance of your personal and family medical and vital health information; up-to-the-minute trip intelligence meaning you can get inside information on politics, public health, safety and other issues; in more than 260 cities and 180 countries; a free international cell phone rental that works in more than 150 countries or an iridium satellite phone for cruise ships or remote regions; and an emergency cash advance of up to $50,000 to take care of your medical needs (some foreign hospitals require up-front payment). Individual for one year is $324 and family is $449.

  

Peter Greenberg is TODAY’s travel editor. His column appears weekly on TODAYshow.com. Visit his Web site at PeterGreenberg.com. 

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