These days most credit cards come with some form of “built in” travel insurance at no cost. The amounts offered and the usefulness of these policies varies from card to card though and if you are traveling it is important that you find out exactly what kind of travel insurance your credit card offers and if it is enough or you need to consider purchasing additional travel insurance from an outside source. Here is a little about the commonly offered types of credit card travel insurance:
Travel Accident Insurance
This is the one type of credit card travel insurance that is attached to almost all credit cards. Not the most appealing insurance to have to think about about as it covers accidental death or dismemberment, not fun travel thoughts at all, but certainly something that is worth having. Most of the policies of this kind offered by credit card companies cover “Common Carrier Conveyance travel” which is insurance broker speak for ticketed passengers on air planes, trains, ships, and buses in most places in the world.
Trip Delay Insurance
You may not think that the fact that your particular credit card travel insurance benefit is that exciting but if your flight is delayed for 12 hours and the airport concourse floor seems to be the only option you can afford without breaking your vacation budget then yo will probably be very glad that you do have it. Trip delay insurance will usually compensate you up to a Martainn amount every day (usually around $150) to book a hotel room or treat yourself to a meal that does not come out of a vending machine.
Trip Cancellation Insurance
Most people plan their vacations well in advance which makes a lot of sense from a planning and budgetary standpoint but unless you are blessed with psychic powers there is no way of knowing that an unexpected event may mean that your trip has to be canceled. And as far as most airlines and hotels are concerned that is really not their problem and the chances of you getting much in the way of a refund are slim to say the least, which is where the trip cancellation insurance offered through many credit cards can come in very useful. Usually as long as the reason for your trip’s cancellation is for a “covered reason” the policy will pay up to a pre set coverage amount, which is typically around $2,500.
What are those covered reasons? It will vary from plan to plan but usually a documented-by-your-doctor serious illness or injury that prevents you from traveling, or the documented serious illness or death of a close family member are two common covered circumstances.
Luggage Insurance
This type of credit card insurance is not so common but it is usually attached to most credit cards that would be considered ‘travel rewards” credit cards. Basically this is insurance that is secondary to any offered by your airline in regards to lost, stolen or damaged luggage. After the airline has paid up whatever it feels is a reasonable amount to cover your loss and inconvenience this insurance kicks in to cover the rest. The airlines have become very stingy with the compensation they offer in these cases so this is another credit card travel insurance benefit well worth having. Some cards also offer delayed luggage insurance coverage which provides a benefit of usually around $150 so you can purchase some essential supplies while you wait for your luggage to catch up with you. This amount is a lot more generous that the around $25 that an airline itself will agree to pay.
Hotel Burglary Insurance
This a common benefit offered on European and Canadian credit card but recently more and more American credit cards have this credit card travel insurance benefit as well. The benefit does tend to be rather limited but it will at least give you a little something back if you should happen to fall victim to a hotel or motel room theft.
Car Rental Insurance Coverage
This type of credit card travel insurance can get a little confusing because there are essentially two basic types offered with various credit card offerings. Car Rental Collision Damage Waiver insurance kicks in as a secondary policy only if your own auto insurance policy does not cover and damage to a rental, which in fact many of them will. Then there is a primary insurance option that will pay out without you having to contact you own insurer and risk having your premium bumped by the existence of an accident, even though it was not in your own car. This more comprehensive protection is usually only offered with the higher end credit and charge cards though.
Is Credit Card Travel Insurance Enough?
If you happen to have a credit card that offers all of the benefits listed above then yes, for many travelers the credit card travel insurance you already have may just be enough and you probably need not worry to much about purchasing additional insurance when you travel. However you should remember that this travel insurance only covers things you purchased with the credit card. Sounds like something of a no brainer but if you ask any credit card company customer service rep they will tell you that they get calls every day from card holders who want to why their credit card travel insurance has nor covered for them for a certain expense that they paid for in cash or with a different credit card!