Podcast conversation with Sean Crosby.
I’m grateful Sean came on the show to simplify what is often considered overly complex. He answered every hypothetical question I came up with and shared many other useful tips.
As consumer advocate Christopher Elliott says “You should consider travel insurance for every trip, but not every trip needs to be insured.”
IMPORTANT NOTE: Travel insurance policies and coverages change frequently. Since the recording of this episode certain Travelex policies have changed. For example: entrepreneurs are no longer able to use Cancel for Business Reasons as a covered reason to cancel. Employees are still eligible for Cancel for Business Reasons, however the policy must be purchased within 14 days of initial deposit for that coverage to be included. Please always refer to the latest policy with your quote for the most up to date information.
There are many types of travel insurance. “Traditional” travel insurance falls into 4 main buckets.
- Ex: work reasons, illness, medical emergency
- Ex: prepaid, nonrefundable, unused portions of your trip and additional transportation expenses if you have to go home early
- Ex: Traveler tests Covid positive while traveling and has to quarantine. Coverage to ‘assist’ with hospital, hotel or rental (there are maximums)
- Ex: hospitalization, evacuation, referrals to local clinics, hospitals, medical facilities
Some examples we discussed:
- You’re a lawyer, married with 2 kids
- You’ve planned a bucket list family safari 1½ years in advance
- Your non-refundable costs are $100k
- A month before you are expected to leave, your #1 client’s IPO is delayed to the 5th day of your trip. You have to cancel the entire trip.
What happens without travel insurance?
- Typically 100% loss on land portion
- Potentially will receive flight credits
With travel insurance?
- If your employer (or fellow general partner or you- if you are an entrepreneur) provides a notarized letter that you need to be at work and can not go on the trip – it is considered a covered event under Cancel For Work Reasons.
*** note – not all companies insure entrepreneurs/partners. Travelex does.
You are the CFO of a publicly traded company.
- You have 3 kids and one is in college
- You don’t want to plan your family’s bucket list Patagonia trip because you know either work will interfere for you or your college daughter may get a job.
- So you never go.
- You take a leap and book it – $90k non refundable trip costs
- 3 months before your trip your daughter tells you she finally found a summer job and can’t go on the trip.
- If her employer provides a notarized letter that she needs to be at work and can not go on the trip – it is considered a covered event under Cancel For Work Reasons.
Medical issue on a trip
What if… You have a minor incident like:
- sprained ankle
- stung by jellyfish
You have a major incident like
- a car accident
Listen to the show to hear a walk through of what happens.
You or one of your fellow travelers tests positive during a routine covid test needed for upcoming trip just before departure.
Listen to the show to hear what Sean says.
You test positive for covid abroad during pre-USA departure testing. What’s covered?
- HINT – not 10 days in the Presidential triplex rooftop Suite at the RC T&C
- Listen to the show to hear what Sean says.
Additional add ons to traditional insurance:
- CFAR (cancel for any reason)
- Range of % coverage – Travelex is 50% others can be 75%
- Exercise by 2 days before travel
- Listen to the show for more details
- You and your spouse are taking your 4 adult children and one spouse to Maui the last week of December 11 months from now.
- Because it’s “festive season” the cancellation terms are very strict and you are in full penalty immediately.
- You are unsure because of covid if there might be a reason to cancel your trip, so you want CFAR insurance to at least cover part of it.
- 2 weeks before departure your retina spontaneously detaches, have surgery and can’t fly for 2 months.
- You exercise your regular travel insurance policy for a covered reason and 100% non-refundable trip costs are covered
- If you had decided up to 2 days before you didn’t want to go because Maui instituted a 5p curfew or any other random reason, you could exercise your CFAR for 50%
2. Adventure Sports
There is a list of what are considered Adventure Sports and require an upgrade (ex: hot air ballooning). If you’d like to know send me a note and I’ll send it to you. Even if you may not think you will do one of these things, if there’s any chance, you’ll want to get it, otherwise you will not be covered.
Not considered Adventure Sport
- Shark Cage Diving
- Hiking (non-technical)
Extra coverage if purchased within 15 days
- Pre-existing conditions
- Insolvency of travel supplier
Other reasons to get travel insurance:
- Required by some countries – ex: T&C, Oman, Chile
What Travelex doesn’t cover:
- Fear of travel
- Vaccination requirements changing preventing travel
- If supplier cancels because of covid concerns
- Travel bans/warnings or restrictions that prevent traveler from reaching destination
- Less than 21 days until trip (this rule was instituted for Omicron. It will hopefully be changing soon)
When should I consider travel insurance?
- Large non-refundable payments
- Covid test before departure on a trip
- You want peace of mind if medical issues were to happen to you, traveling partner or close family member before or during the trip
When you may not need travel insurance:
- Minimal/no cancellation penalties
- If you get a credit for future travel and are ok with that – airlines, hotels
– TIP: depending upon the trip – consider the airline you are flying – will you fly them again?
- NOTE: even if you don’t need it for trip cancelation, consider getting minimal coverage for medical issues
Other travel insurance membership provider that I work with for the right type of trip:
- Global Rescue