When you and/or your employees travel for business, what is your policy towards insurance? If the company laptop is stolen or damaged, who pays for it? And if somebody is hospitalized, how does the bill get paid?
These are questions every business owner must consider when traveling for business. Travel insurance can be the solution. But in some cases, you may already have coverage and not know it.
Whether for business or pleasure, here are the basics of travel insurance.
Trip Cancellation. If a personal or family medical emergency necessitates the cancellation of a trip, this form of insurance reimburses you for any non-refundable travel expenses, such as flights. Most of the time you can’t purchase it if your flights are already booked, so make sure you have this arranged at the time of (or prior to) booking airfare. And because of the many stipulations and conditions around making claims on this type of insurance, it’s often only worthwhile for long-haul trips.
Baggage Loss/Theft. When your belongings are lost, stolen, or damaged, this type of travel insurance kicks in to reimburse you. Policies differ in how they valuate your belongings, and coverage also depends on how and where your belongings were lost or damaged. Proof of ownership (such as original purchase receipts or photos of the item) is usually required as part of the claims process, and reimbursement is rarely immediate. For personal travel this isn’t a very practical form of insurance, but business travelers with expensive technology may find it useful. Later we will discuss some of the differences between personal and business travel insurance policies.
Emergency/Accidental Medical. Depending on where your business trips take you, this is one of the most practical forms of travel insurance. In the event of a medical emergency, your medical expenses will be either directly paid or reimbursed to you. Not all accidents or illnesses are covered, such as pre-existing conditions, participation in certain sports, or travel through war-torn areas. And if you are traveling within your own country, it may be that your health insurance plan will cover you instead.
Where and How to Purchase Business Travel Insurance
Although most travel agents offer insurance with the purchase of your trip, it isn’t always the best option available. It pays to shop around for business travel insurance. It may also be that you already have coverage through other policies (we’ll get to that shortly).
You can purchase travel insurance on a per-trip basis or an annual basis. Generally speaking, if you (or your employees) take more than two trips per year, it is more cost-effective to purchase an annual policy. Within an annual policy, you can stipulate the maximum length of any trip to be covered (the shorter the trips, the less expensive the insurance).
Business travel insurance can also be paid for by the employer or employee. When companies purchase travel insurance for all their traveling employees, bulk discounts are often available. (And in most cases, it is tax-deductible to the employer as well.)
Business Travel Insurance Features
In addition to the basic travel insurance benefits above, following is a list of potential extras you get with a business travel insurance policy:
Business Equipment. Things like computer equipment, product samples, and other items that are imperative for the business trip will have coverage, and the coverage limits are often higher than for personal travel insurance policies. There may also be coverage for the rental of such items while you await replacement or reimbursement.
Cash. If you need to carry large amounts of cash for a business trip, a business travel insurance policy may provide better coverage for lost or stolen cash.
Loss of Income. Although disability insurance policies usually cover loss of income in the event of an illness or injury, some business travel insurance policies have additional coverage if the illness or injury takes place during a business trip. The terms are similar in nature to short-term disability insurance.
Higher Limits. Across the board, business travel insurance policies often feature higher coverage limits for trip cancellation and baggage loss/theft policies.
Substitute Business Person. Some policies will cover the expenses to send out an alternate employee to complete the business trip if the covered employee falls ill or injured during the trip.
Determining if You Already Have Coverage
By booking your travel with a credit card, you may already automatically have baggage loss/theft and trip cancellation insurance, as well as some forms of rental car insurance. And your health insurance plan could well cover you for travel both within and outside of the country. Here are a few forms of automatic insurance coverage you may wish to investigate, along with some questions to ask to see if you have coverage.
Credit Card. Possible auto rental insurance, baggage loss/theft, trip cancellation and even some accidental medical insurance could be provided by virtue of charging your trip to the card. Be sure to ask what is specifically included, and if business travel is covered.
Health Insurance. The level of coverage provided is largely dependent on where you travel and how comprehensive the policy is. Ask if coverage is provided outside of the country (if applicable), if ambulance and emergency airlift is covered, and what the limitations are.
Life Insurance. Even life insurance can cover expenses if you are seriously injured or if you die abroad and your body needs to be shipped home. Ask what happens if you die in a foreign country (or even domestically), and what benefits are provided if you are seriously injured.
Rental/Homeowner’s Insurance. In some cases, you may be surprised to discover that travel insurance won’t cover the loss or damage of certain items, and instead that they are covered under your home insurance policy. Ask which belongings (if any) are covered if you take them out of the house, if there is compensation for lost/delayed baggage (and how long bags must be missing before you can make a claim), what information you need to provide to make a claim, and if valuables like jewelry are covered.
In all the above cases, it is imperative to ask if business travel is covered, since they may only cover travel for personal reasons.
Tips for Travel and Making Claims
Take these tips below seriously. I’ve had to make travel insurance claims — more than once — and without doing everything below, there’s a good chance I would never have been reimbursed.
1. Have your policy information. Carry your business travel insurance company name, policy number, and claims phone number with you at all times. Be sure to leave this information with a family member or business colleague at home so they can advocate on your behalf if you are unable to make that call.
2. Call the insurance company first. Before seeking medical help or going to the hospital, always call the insurance company first (if possible). They may direct you to a specific hospital with which they have a relationship, and in some cases if you don’t call first, you won’t be covered at all.
3. Write everything down. Log every detail of communication with both medical providers and your insurer. You may need this information later if you have trouble making claims.
4. Keep Copies. Although most insurers will require original documents (such as receipts or bills), make copies of everything for yourself. This gives you recourse if something gets lost in the mail, and may be of help when communicating with the insurance company in regards to the claim.
5. Read your policy thoroughly. It pays to understand your policy inside and out, as not all insurance policies are created equal. If you can, carry the entire policy with you when you travel so you can reference the language that is specific to your travel emergency when it arises.
6. Be persistent and observant. Although it’s the job of the travel insurance company to provide you with emergency coverage, it’s also their job to pay out as little as possible. I’ve never had an instance when proper reimbursement happened upon the first claim. Don’t be afraid to escalate your claim if you aren’t getting the assistance you need, and don’t take no for an answer if you believe you are right. I cringe at some of the completely illogical arguments I’ve had with insurance representatives who have refused me coverage or made blatant mistakes they won’t reverse.
As much as the advice above may make you wonder why you would bother having business travel insurance at all, it is indeed a useful mechanism (and necessary evil) in many cases. Simply cover your bases, know your rights, and ensure you have the coverage your need, and your next business trip will go off without a hitch.
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