Travel Insurance

Old Jun 18, 12, 12:17 pm
  #1  
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Join Date: Jun 2012
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Travel Insurance

Quick questions about how to calculate how much Travel insurance you need.

I booked some tours and hotels etc in Argentina and they come to around $5000 but I used Frequent Flyer miles to book my international airfare. Taxes and Fees total around $150 for two people. If I want to cancel these tickets and get my miles back, it will cost me $150 per person or $300 total. The cost of the tickets, had I paid cash would have been in the $2800 range.

What number should I use for my travel insurance purposes?

My initial thought was $5,000 + $300 cancellation costs to get my miles back to be safe (since the taxes are refundable if I cancel) but second guessed myself and wondered if I should actually take out $5000 + $2800?

Any suggestions would be great.
DutchessPDX is offline  
Old Jun 18, 12, 12:33 pm
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Originally Posted by DutchessPDX View Post
Quick questions about how to calculate how much Travel insurance you need.

I booked some tours and hotels etc in Argentina and they come to around $5000 but I used Frequent Flyer miles to book my international airfare. Taxes and Fees total around $150 for two people. If I want to cancel these tickets and get my miles back, it will cost me $150 per person or $300 total. The cost of the tickets, had I paid cash would have been in the $2800 range.

What number should I use for my travel insurance purposes?

My initial thought was $5,000 + $300 cancellation costs to get my miles back to be safe (since the taxes are refundable if I cancel) but second guessed myself and wondered if I should actually take out $5000 + $2800?

Any suggestions would be great.
Take the miles out of the equation an what do you have? If you paid cash the tickets would be $2,800, and if refunded you would get $2,500 back, net loss to you of $300, so that's your insurance claim. I don't think any insurance would pay out for "loss of opportunity" - the fact you might not be able to find another miles flight.

On the $5000 for the hotels and tours, check their refund rules, it's likely they will give you something back, e.g charge you for 1 nights stay if cancelled more than a month out, charge you 3 nights if less than a month, etc.
NeverFirst is offline  
Old Jun 21, 12, 8:14 am
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Join Date: Jun 2012
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Only include the out-of-pocket expenses, you cannot include the face value of the tickets. Travel insurance only reimburses you for cash loss. Though you can include the miles rebanking fee.

Think of it this way, if you cancelled your trip the day you were suppose to leave, how much money would you have lost? That's the number you include for your trip cost.
tiorg is offline  
Old Jun 21, 12, 8:24 am
  #4  
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Read the Policy First

Nobody can answer your question here without the exact terms of the policy in front of them. Read it carefully. The greater the risk the insurer takes on, the greater the cost to you. Conversely, you may be able to cover the bulk of your losses for relatively little.

In addition, consider whether you have coverage for out-of-pocket medical if you do take the trip and need to be airlifted back home or receive special services which your health insurance may not cover, or you can't travel for some period of time and incur significant additional hotel costs and the like.

It's also worth looking at the following coverages which you may already have:

1. CC you used to pay for the trip.
2. Homeowners/renters or umbrella
3. Employers' policies (even if it's leisure travel)

You may have one or more of these and not have looked carefully.

Generally speaking, it's not worth the cost of insurance or the time & effort to submit and document for relatively small losses. But, you need to look at large out-of-pocket, because stuff happens.
Often1 is offline  

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