On October 14, 2011, Wise Bread wrote an article for U.S. News entitled 5 Common Travel Insurance Myths. The article listed the following common misperceptions about travel insurance::
1. Emergency medical assistance is included
2. Having trip protection with a credit card is
sufficient
3. Travel insurance doesn't cover airline delays
4. Activity-related Injuries aren't covered
5. You don't need rental car damage protection
I agree that consumers should be aware of these common myths prior to purchasing travel insurance. However, I am supplementing this list with what I believe is perhaps the most important tip of all.
6. Don't purchase travel insurance unless you are willing to fight to get your benefits.
Perhaps the most common myth regarding insurance is that the insurance company will honor the insurance agreement and fairly pay your claim. In my personal injury practice, I see valid claims denied and undervalued by insurance companies on a daily basis. Insurance companies know that most insureds do not have the experience or resources to stand up for their rights so they routinely deny valid claims in hopes the insured does not pursue the matter.
A few years ago, my mother purchased travel insurance in case an emergency prevented her from going on a cross country trip. As luck would have it, upon arrival at the airport, my mother realized that she had forgotten her identification. Without an ID, she was not allowed through security and missed her flight to the west coast. Therefore, she filed a claim under her travel insurance policy since this unanticipated emergency was clearly covered.
To her surprise, the claim was denied. I took up the appeal on her behalf, which, by agreement, went back to the insurance company for a second review. The insurance company denied the claim again. As per the policy, the next step was to submit the claim to binding written arbitration. I spent several hours drafting an argument to the arbitrator regarding why my mother had a valid claim. Perhaps my most convincing argument was that the insurance company denied the claim twice - failing to cite any policy exclusion or reason. Finally, a win. The arbitrator found in my mother's favor and she was awarded the price of her airline tickets. The whole process took months to resolve and stole many hours of my time. All for an award totaling approximately $500.
In summary, I believe the most important thing to keep in mind when purchasing travel insurance (and any insurance) is that even if you are covered it is likely your claim will be denied or undervalued and you will have to fight the insurance company. So I pose the question, is travel insurance really worth it?
