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What Is Travel Insurance, and Do You Really Need It?

Danielle Kubes

Has anything really annoying happened when you were travelling? Nobody plans to break their arm rappelling in New Zealand, or expects to cancel a trip because because it conflicts with an exam. But that’s where travel insurance comes in: it protects you from the what-ifs no one wants to consider when on vacation. And yes, you really do need it.

To minimize possible emergencies or headaches, consider charging your next trip to a travel rewards credit card, which includes the major perk of coming with comprehensive travel insurance.

It can make more sense than paying extra in piecemeal insurance. Not only is it less hassle than calling up different agencies to compare rental car insurance, trip cancellation insurance, medical insurance, etc., but you’re likely to end up with broader coverage. How many people are really likely to purchase extensive insurance on their own before every trip?

The BMO World Elite MasterCard, for example, covers emergency medical, cancellation, interruption, flight delay, travel accident, baggage loss, baggage delay and car rentals.

Card details

  • $150 annual fee
  • VIP airport lounge access with the included Priority Pass membership, plus 4 complimentary passes per year
  • No blackout dates; points can be used to cover taxes/fees
  • $2 million in travel medical insurance coverage (up to 21 days)
  • Travel accident insurance: Up to $500,000

In addition to being one of the best travel rewards credit cards in Canada for 2017 for its perks and points-earning potential, this card has a suite of travel insurance features that give peace of mind to know that a wide range of eventualities are covered.

Let’s say your flight is delayed because of snow. If you’re a BMO World Elite MasterCard holder, you’ll get your expenses paid back to you, such as meals and accommodation (up to a maximum limit) under “flight delay.” Or, on the more serious side, you don’t have to worry if your rental car gets stolen while you’re busy taking pictures of a sunset, under “car rentals.” Here are the most common types of travel insurance benefits credit cards offer:

  • Travel medical: If you require urgent medical care, such as forehead stitches or a cast for a broken arm, it covers your expenses up to a certain amount.
  • Travel accident: Basically a form of life or disability insurance that pays out in case you suffer a serious accident that includes a loss of life, speech, hearing or limbs while occupying a common carrier vehicle, such as a plane or train.
  • Trip cancellation: You can get reimbursed in case you need to cancel your trip for an eligible reason.
  • Trip interruption and delay: You’re covered if your trip has to be cut short or is delayed after the scheduled departure date for an eligible reason.
  • Car rental collision damage waiver: You’re covered if your rental vehicle is damaged or stolen.
  • Flight delay insurance: If you’re flight is delayed for certain number of hours your expenses, like food and accommodation, will be reimbursed.
  • Lost baggage insurance: You’ll be reimbursed for a portion of the replacement cost of your check luggage if your airline loses it.
  • Baggage delay: You’ll get funds to replace essential items if your airline temporarily loses your luggage.

The type and coverage included varies by card, so it’s essential to read the fine print. There also may be age or eligibility limits. If you’re out of the country for longer than 10 days, for example, or if you’re over the age of 65, you may have to purchase additional medical insurance. Here’s a handy chart of what the BMO World Elite MasterCard covers.

To get reimbursed just ensure that you pay for your trip or any service with your card. You typically have until a year after to submit a claim. Keep all applicable documents and than call their insurance hotline as soon as possible.

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