A few years ago, I was checking in for a flight at Denver International Airport. I had to check a bag, and it was close to the time when the baggage handlers would no longer process bags. At this critical moment, the baggage check-in equipment malfunctioned. The woman in charge of my check-in gave me a shrug and a smile and said (I'll never forget this): "Hey, travel is an adventure." And boy, was she right.
Recently, I decided to try Alaska Airlines' new direct service between Colorado Springs and Seattle. This led me to buy a nonrefundable round-trip ticket for $204.50. When I bought it, I was offered travel insurance. I have never before bought travel insurance, but because my trip to Seattle was six weeks away, horror stories about weather-caused cancellations and delays were everywhere and this was a new route for Alaska Airlines, I decided to spend the extra $21 and buy the insurance. At the time, I had no real idea what I would receive for my money.
Now, however, I have a policy in hand and have at least a basic understanding of what the policy covers. So let me share some of what I've learned.
To begin, travel insurance is like other forms of peril-related insurance. It involves a contract (called a policy) between the insured and the insurer. Under the terms of the contract, the insured pays a premium and the insurer takes on certain risks the insured faces in traveling. Like other forms of insurance, there are conditions to, limitations on and exclusions from coverage, and a careful review of the contract (painful though that may be) is necessary to understand the protection it does - and does not - provide.
As with other forms of insurance, companies offering travel insurance must abide by Colorado's insurance laws, and they're subject to regulation by the Colorado Division of Insurance.
Premiums are determined by competition, the scope of the coverage and the cost of the travel. Premiums and coverage can vary greatly from one company to the next and from one insurance product to the next.
The protection I am receiving for my $21 investment includes 24/ 7 telephone assistance; trip cancellation, delay and interruption; lost or delayed baggage; and emergency medical and dental expense. Each of these is subject to conditions and a dollar limitation.
The trip cancellation/delay/interruption coverage kicks in only if the cause is injury, illness or death; a traffic accident on the way to the airport; a subpoena to appear in court; severe weather or a natural disaster; a hijacking; or a terrorist event at my travel destination (but only if it's in a foreign country. I don't believe Seattle qualifies.)
A change in personal commitments necessitating a postponement of my trip is not covered. In that case, I will still be at the mercy of Alaska Airlines for a rebooking fee and any increase in ticket cost.
With regard to claims limitations, my trip cancellation/delay/ interruption coverage is capped at $350; my lost baggage limit is $500 ($200 for delay); and my emergency medical benefit runs out at $10,000 ($500 for dental).
Did I get my money's worth when I bought travel insurance for this trip? That's a hard call and requires me to weigh such things as the risk of an accident on the way to the airport (substantial); an April blizzard (moderate); and Alaska Airlines giving up on Colorado Springs and canceling my flights (hopefully not substantial).
Jim Flynn is a private attorney with Flynn Wright & Fredman LLC in Colorado Springs. Email him at firstname.lastname@example.org.