Understanding the meaning of travel insurance terms and conditions

[twentyknots]

We’re planning a cruise for late January, 2023 and have already paid our non-refundable deposit.  We want the pre-existing waiver so I know we must buy travel insurance with 14 days of our deposit.

I plan to buy the initial coverage of $500 since that is what’s at risk at this time.  Subsequently on October 31 the remaining balance of the cruise is due. Here’s my first question: my booking confirmation says that “taxes, fees, and port expenses” are $331.  They don’t itemize these fees.  Does that need to be insured?  It’s my understanding that if the cruise is cancelled Celebrity will refund the taxes to my credit card.  They don’t mention the port charges.  The insurance states that “prepaid non-refundable charges must be insured.”

 

Second, when I book air I will add that to the policy.  That seems clear enough. 

 

Third, I plan to make hotel reservations sometime after final payment but those are not prepaid.  There would be charges if we cancelled them less than 48 hours before scheduled check-in.  Should these potential losses be insured?  Maybe I should say “must” these potential losses be insured to meet the T’s and C’s?

 

Thanks for your responses.

[Babr]

Taxes, fees, and port expenses are refundable. You do not have to include those in the amount you insure.

 

Be careful about including air because the airlines issues vouchers if you cancel. Once you accept the voucher, insurance will not reimburse because you have already been compensated. Be sure you understand how that works before you buy.

 

Some policies require that you include all nonrefundable expenses in order to qualify for the pre-existing conditions waiver. That complicates the question of whether to insure air and hotels. Technically, those hotels become nonrefundable at some point. 
 

IMG policies do not have such a requirement, but I’d discuss it with a professional to be sure since the pre-existing conditions waiver is important to you. Many here recommend the people at Trip Insurance Store.

[klfrodo]

My 1st question is, what State do you live in? All insurance is regulated individually by each State. My State of Washington, for example, does not have the requirement that all non-refundable costs be covered to waive the pre-existing condition clause. Just the time frame of initial deposit. I didn't know this until I spoke with Steve at Trip Insurance Store.

 

I don't insure my air travel because my elite status allows me to cancel and receive a future travel credit, or, if I use miles they will rebank my miles with no question.

 

I also don't insure my hotel stays because I always book with the option of canceling within 48 hours of the beginning of my stay. Even if I was overwhelmed with a crisis and I forget to cancel, the penalty is 1 night stay. I can absorb that if needed.

[GeezerCouple]

I strongly agree that you should speak with a travel insurance specialist.

We are among those who have worked with www.TripInsuranceStore.com ever since we learned about them here on CC in 2013.

 

As an aside, we've purchased many policies through them and we've had several claims, including some large ones.  All were paid with no nonsense.  In good part, that's because Steve and his associates there helped us understand what was and what was not covered by the various choices of policies so we could find one that met our specific needs.

 

But note:  There is no universal "14-day time limit" to starting the coverage in order to get certain types of coverage.  As mentioned above, insurance is regulated by the states, so this timing can depend upon not just the policy, but which state you live in.  My understanding is that it could be as short as 10 days or as long as 20 days, but please do *NOT* depend upon my statement:  check with the specialists!

 

And I think there are policies to include pre-existing conditions that are available later, from at least one insurer.  Again, check with an insurance agent/broker.

 

Most of the travel insurance complaints we read about, here on CC or elsewhere, end up being due to some misunderstanding about the terms of the policy, so make sure that *you* read your policy.  Any questions or things you don't understand?  Ask!

 

The type of coverage we get requires that we insure ALL non-refundable pre-paid costs, but there are other policies that do not require this.

 

GC

 

[twentyknots]

Babr, thanks for the airline tip.  I called and they did say if we cancel for any reason they would issue E credits for future travel, so no need to insure that prepaid expense.

[twentyknots]

I will call the tripinsurancestore people and see what they say.  I did logon to their site and got some quotes but the number of insurers was limited compared to other sites.

[Babr]

18 minutes ago, twentyknots said:

I will call the tripinsurancestore people and see what they say.  I did logon to their site and got some quotes but the number of insurers was limited compared to other sites.

They have a limited number of insurers because they only do business with companies they have vetted and trust. They have long-term association with these companies and are thoroughly knowledgable of their policies.
 

I wouldn’t necessarily be deterred by having fewer companies to choose from. The real test comes if you have to file a claim.

[Jersey42]

43 minutes ago, twentyknots said:

I will call the tripinsurancestore people and see what they say.  I did logon to their site and got some quotes but the number of insurers was limited compared to other sites.

Definitely a good idea.  They only offer a subset of available policies, but they know their policies very well and can provide you with the correct info for those policies.  Some of the other big insurance sites are very good to help you filter out policies you don't want. But to figure out which ones work for you, you still need to read the policies as the high level summaries often miss important details.  The last time I tried calling one of the others when I had two specific questions they gave me bad advice.  When I called Steve at TIS about that policy, he was able to give me accurate advice, even though it was for a policy he did not sell.  He did look at his policies, but agreed that the other one I was looking at was a better choice for my unique situation.  He lost a sale, but gained a lifetime fan and customer.

 

46 minutes ago, twentyknots said:

Babr, thanks for the airline tip.  I called and they did say if we cancel for any reason they would issue E credits for future travel, so no need to insure that prepaid expense.

 

Be careful with this one.  Some policies that require you to insure all pre-paid non-refundable costs in order to qualify for a pre-existing conditions waiver will require you insure the airfare.  If the airfare is fully refundable in cash, there is never a requirement to insure it.  If it is refundable in an airline credit then the airfare is often considered a "pre-paid non-refundable cost".

 

You may want to look at https://tripinsurancestore.com/what-is-your-trip-cost/ before calling TIS. It addresses two of your initial questions (although with most cruise lines "taxes, fees, and port expenses" are fully refundable).  It also has a link to an old blog post that touches upon your hotel question.  A phone call to discuss your situation and ask what-if questions is still extremely beneficial.  Please let us know what you find out.

 

Edited September 10, 2022 by Jersey42

[twentyknots]

Update on conversation with Steve

 

We have $3000 in Visa travel credits which we can use as credits on our Visa bills for travel related costs going back 12 months.  We planned to pay for our cruise, airfare, hotels, and some of the onboard charges.  Steve said that if we use these credits to pay for the cruise, for example, and have to cancel the trip, the insurer will deny a claim for the cruise since it was not an out of pocket expense.  I asked how they would know that I had used credits and he said they will ask for proof of purchase and if my Visa bill shows the cruise fare charge and payments with the credit they will deny it.  I suggested that I will just pay the minimum payment for a few months until the trip is over and then use the credits to pay it off.  He said that would work.

As for the airfare, that was a kick in the teeth.  We have E credits from a flight in 2019 that we plan to use along with $400 in out of pocket. If we have to cancel, the airline will give use E credits for the total airfare.  Steve said we have to insure the $400 because it’s prepaid and non-refundable, but the insurer won’t reimburse us for the $400 since it would be credited back to us as an E credit.  An E credit is not considered a refund by the insurer. 

We want the waiver for pre-existing not because we have any current medical conditions that we think might invalidate the medical coverage, but because like most people we have had some past medical issues and don’t want to give them any reason to deny a medical claim.   Basically we don’t trust them.  Steve said because we plan to use our airline E credit, the trip deposit is the date on which the E credit was based.  Therefore, we missed the 14 day rule by 3 years.  So, that leaves us with not using the E credits and paying the full cost of the airfare and using the deposit for the cruise as the beginning of the 14 day countdown if we want the preexisting waiver.

The hotel can’t be insured since it’s not a prepaid expense. 

In summary, very disappointing news.

[Babr]

There are some significant details that were not revealed in the original question, making any earlier comments pretty useless for your situation. That is why it is important to talk directly with Steve about specific circumstances. 

Sorry it was not the answer you were hoping for, but at least you got accurate information so that there will be no false expectations or nasty surprises if a problem arises. Insurance is complex as it is and becomes even more so when dealing with credits, vouchers, or FCC.

Thanks for the update.
 

 

[Jersey42]

41 minutes ago, twentyknots said:

In summary, very disappointing news.

Sorry that most of this is not working out the way you hoped.  It is still better to find this out before making some of your payments.  It is also much better to find out the gory details now, rather than when a claim is denied.

 

If you don't have any pre-existing conditions and your medical history for the lookback period can document this, is it worth the risk to go without a pre-existing conditions waiver?  Benefits:

• It is simpler
• You could use the Visa and credits now
• You would not have to insure the airfare
• You don't have to hold on to airline credits for a future trip with the same insurance issues
• You save a few bucks on the insurance and finance charges

 

Of course, if you still have a high level of concern with the insurance company and pre-existing conditions, the approach you discussed with Steve solves all of that and you may sleep better at night 🙂.

 

Thanks for filling us in.

Edited September 10, 2022 by Jersey42

[twentyknots]

20 minutes ago, Jersey42 said:

• You could use the Visa and credits now
•  

I dont think giving up the on pre existing waiver would have any bearing on the use of Visa travel credits.  If we had to cancel the trip and were in the 100% penalty phase the insurer would deny the claim for the cruise refund based on our using the credits and not having any OOP expense.

Edited September 10, 2022 by twentyknots

[Jersey42]

39 minutes ago, twentyknots said:

I dont think giving up the on pre existing waiver would have any bearing on the use of Visa travel credits.  If we had to cancel the trip and were in the 100% penalty phase the insurer would deny the claim for the cruise refund based on our using the credits and not having any OOP expense.

My bad - your previous post was very clear on that point.  At least you know the proper way to use the credits for insurance coverage purposes.

Edited September 10, 2022 by Jersey42

[twentyknots]

Steve called back yesterday with an update on possibilities for a comprehensive policy with pre existing waiver that doesn’t require purchasing the insurance 14-21 days after initial booking but couldn’t find one that was reasonably priced.  So that’s off the table.

He did say that if we decided not to use our airline E credits and paid OOP for the tickets and insured that amount (which we have to for the pre existing waiver) we could get a refund if the airlines agreed not to issue us an E credit.  Steve’s experience with the airlines to do that is mixed he said.  I’m surprised that the insurance companies will reimburse for the airfare if the airlines agree not to issue E credit.  Nice to know I guess.

Knowing what we know at this point, I’m inclined to purchase medical coverage from GeoBlue.    No cancellation protection, but good medical and evac coverage with pre-existing waiver.  We don’t have to buy the GeoBlue until very close to departure and we can use our Visa credits and airline vouchers.

Canceling our trip is highly unlikely, but even if we do, we’ve really just lost a part of our Visa rewards.  No big deal.  The potential for a medical emergency is equally unlikely but the financial consequences are much higher.   I’ll sleep better.

[klfrodo]

You've come a long way in 3 days with your education regarding the intricacies of Travel Insurance.

 

When I first started, I was just happy that I finally adulted and bought travel insurance. My thought process said, hey I'm covered for everything. Miss the plane, call the insurance company and they issue new tickets. Get hurt somewhere, hey call the insurance company and they directly pay the bill.

 

Man, was I stupid. Glad nothing ever happened. Then I started reading this board and/or talking to Steve.

[twentyknots]

Ditto for me, as far as being naive about travel insurance.  We've cruised 27 times and always bought travel insurance, mostly from our TA.  Many times we used Visa travel credits thinking nothing of it.  We may have used airline vouchers in the past so I suppose our thinking that we had a pre existing waiver was incorrect.  Off we went on our cruise confident that we had done the right thing.

 

Thankfully we never needed to file a claim.

 

Our last cruise was Alaska in June 2019.  Two weeks after returning I had appendicitis and needed emergency surgery.  Just real lucky it didnt happen while we were in one of the small ports during the cruise.  

Edited September 11, 2022 by twentyknots

[klfrodo]

On my recent Alaska cruise, I didn't insure anything.

I self-insured or took the risk that I wouldn't have to cancel.

If a medical emergency happened on the ship, the Coast Guard would provide the evacuation and that's no charge. The ports all have hospitals that even if they cant do open heart, they can at least stabilize and evac to a larger hospital. And, being in Alaska, even at the smaller ports, your regular insurance and/or Medicare will cover.