Planning a trip this holiday season? While booking flights and hotels might be the first thing on your mind, having proper travel insurance can certainly be the most important.
Why do I need travel insurance?
Simply put, when you leave Canada your Canadian insurance won’t cover you anymore. Certain provincial and territorial health plans may cover some portion of medical care abroad, but typically only a small amount, if at all. You can check to see if your provincial health ministries provide such coverage here. When you travel without travel insurance, you’re putting yourself at the mercy of your own health. Any injury or sickness that requires hospitalization, especially an American hospital, can end up costing you thousands of dollars in medical bills. And unexpected injuries happen more than you think - here’s a story posted by the Government of Canada: “Gabrielle had insurance that lapsed three weeks before she was involved in an accident. Her Canadian family had to raise $300,000 over a three-day period to cover the costs of medical treatment and evacuation. Fortunately, she survived, but her family is left with a hefty debt to repay.” Having travel insurance can be the difference between paying a couple hundred dollars, or a hundred thousand. However, you have to make sure your travel insurance covers what you need.
What does travel insurance cover?
Travel insurance should include health, life and disability coverage. These essential coverages will help mitigate the cost of hospitalization outside of Canada, as well as any medical treatment. Two important features you should make sure your travel insurance includes are Medical evacuation and Repartition in case of death. Medical evacuation coverage helps to pay travel costs if you need to be moved to a hospital due to an injury. It will also cover the travel costs of any medical escorts that need to accompany you. A grim thought, but coverage of repartition in case of death will ensure that your remains are transported back to Canada without incurring hefty expenses. Ultimately, the number of features on your travel insurance plan depends on your risk tolerance. If you know you’ll be bringing along expensive luggage, you can include baggage insurance on your travel plan as well. Every feature, however, will bring up the overall cost of your insurance.
How much does travel insurance cost?
As with all insurance, there are a lot of factors that go into calculating the total cost of your travel insurance. As a rule of thumb, travel insurance typically costs somewhere from 4% to 10% of your trip’s total nonrefundable expenses. Non-refundable payments include airfare, hotels, prepaid tickets to special events, and any cancellation penalties. They don’t include any non pre-paid expenses, like gifts or food. Other factors, like the age of trip participants, length of the trip, and medical history, also play a role in determining your travel insurance costs. There can even some circumstances where your travel insurance company may not cover your medical costs if your medical condition significantly worsened before your trip. You can learn more about pre-existing medical conditions and travel insurance at The Travel Health Insurance Association of Canada’s website here. The most important thing you can do when looking for travel insurance, is to ask questions. Make sure you know exactly what you’re getting, and whether or not you need everything that comes in a certain travel plan. Our salaried financial advisors have lots of experience creating travel insurance packages that work for your individual needs. If you have any questions regarding your travel insurance, or want to acquire some, don’t hesitate to contact our advisors here, or call 1 888 235 6169.
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