News Release

New Jersey Department of
Banking and Insurance

Commissioner Ken Kobylowski

For Immediate Release:
August 29, 2013

For Further Information:
Ed Rogan or Marshall McKnight (609) 292-5064

Travel Insurance Tips for Late Summer and Fall Travelers

TRENTON – New Jersey Department of Banking and Insurance Commissioner Ken Kobylowski today urged late summer and Labor Day travelers considering buying insurance to cover their long planned trip to use caution and be sure of what coverage they purchase. Insurance fraud and misleading protection claims may offer little or no protection for a dream vacation.

“Travel insurance may not be appropriate for all trips,” said Commissioner Kobylowski. “A long planned expensive vacation may be worth insuring. However, before shopping for extra coverage consumers should explore with their insurance agent or carrier and credit card provider as to what protection may already be in place.”

After reviewing possible existing travel insurance supplements, Commissioner Kobylowski encouraged consumers to ask the following:

• Do I really need the coverage?
• What could go wrong before or during the trip? Can I cover those costs on my own?
• Will the coverage apply to family emergencies affecting someone other than the traveler or does the policy only apply to personal emergencies such as illness?
  
  

Travel insurance agents and companies must be licensed in the state where consumers buy the policy. While reviewing travel insurance benefits, consumers also need to verify what state licenses the carrier. 

Fraudulent travel insurance marketing and sales material may be difficult to discern from promotional literature made by licensed firms. Consumers must protect themselves and STOP before writing a check for the premium or signing anything and CALL the New Jersey Department of Banking and Insurance at 1-800-446-7467 and CONFIRM that the agent and company are licensed in New Jersey. To verify that a travel insurance agent or company is licensed in New Jersey, consumers can point browsers to: Licensee Search

Travel Insurance Types 

There are two main types of travel insurance. The first type, commonly called trip cancellation insurance, protects against the loss of non-refundable travel costs, such as airfare, hotel or tour expenses. Examples of these expenses would be non-refundable airline tickets or a deposit on a cruise.

The other type of travel insurance is protection against a large expense due to medical emergencies, damage to personal property or death that occurs while you are traveling.

“Travel insurance generally covers a very specific list of reasons for cancellation, delay or interruption,” said Commissioner Kobylowski. “Before consumers buy a policy they should make sure they have reviewed travel insurance policy conditions carefully.”

Trip Cancellation – Reimburses pre-paid travel expenses if vacationers are not able to take the trip due to illness or death.

• Travel Delay – Returns pre-paid expenses if consumers cannot take a trip as a result of delay caused by an airline cancellation or other reason.
• Trip Interruption – Pays pre-paid expenses if a trip is cut short because of any other misfortune listed in the policy. Coverage may include bad weather, airline strikes, terrorism, bankruptcy, jury duty or fire or flood damage to your home.

Medical/Accidental Death Insurance may contain pre-existing condition and age limit exclusions. Such exclusions vary widely.

• Medical/Health – Reimburses medical and emergency dental expenses that you incur due to illness or injury while you’re traveling.
• Medical Evacuation – Provides emergency transportation to either a hospital in the geographic region where you are and/or transportation back to a hospital near your home.
• Accidental Death – Generally divided into three parts:
  1. Air Flight Accident – Covers death or dismemberment during flight only.
  2. Common Carrier – Covers death or dismemberment while traveling on public transportation such as a plane, ferry, train, bus or taxi.
  3. Accidental Death – Covers death or dismemberment at any time during a trip.

Travel Insurance Fraud

“Consumers should keep red flags in mind as warnings that some policies found online, from phone solicitations or through direct mail correspondence may possibly be fraud,” said Commissioner Kobylowski. “As I often say, if it seems too good to be true, it probably is.”

Here are some of the red flags for fraudulent travel insurance policies:

• The insurance is marketed with blast faxes, spam e-mails, Internet pop-ups or signs posted on telephone poles.
• The company claims you can save hefty amounts on travel insurance.
• The company uses high-pressure sales techniques with an extreme sense of urgency with lines like, “you must act now” or “this one-time offer.”

Travel Insurance Checklist

To avoid fraud and find the travel insurance that best fits individual needs, consumers should refer to this checklist:

	Make sure the company and the person selling travel insurance are licensed by the State of New Jersey.
	What is the refund policy on pre-paid expenses?
	Other than a full refund, what benefits are being offered? Examples may be rebooking a flight or assistance in finding a new hotel room.
	Who is covered? Does the policy extend to family members?
	If working with an agent, make sure it is one you trust who regularly sells travel insurance. Find out about a carrier’s track record and other customers’ claims filing experiences.
	What is covered? If planning an adventurous vacation, such as hang gliding or scuba diving, ask if the insurance covers those activities.

“Consumers need to be aware of all exclusions and should be prepared to pay a higher premium in some cases,” said Commissioner Kobylowski. “American health insurance is generally not accepted outside the United States. Travelers should talk to their carrier or agent before buying this coverage and keep asking questions until they are satisfied with all the answers.”