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Ask the Expert: What you need to know about travel insurance before you go on a trip

Canadians Gilles Dupont, left, and Monique Dupont sit in the sun, Tuesday, Jan. 24, 2006, in Dania Beach, Fla.   Temperatures at the Dupont's home in Valley Field, a small town southwest of Montreal, were in the low-30s midday Tuesday.

Canadians looking to ditch the cold this winter for a sunny destination may want to be prepared in case something goes awry.

While most of the travel issues from the pandemic aftermath are mostly resolved, the industry is still working out the kinks and travel insurance can provide protection in case things don’t go as planned, according to Matt Hands, vice-president of insurance at Ratehub.ca.

“The travel industry is still in a state of flux. It's in a much better position today than it was a year ago, but flight delays will happen,” Hands said in a recent interview with Yahoo Finance Canada.

“There’s a lot of baggage loss that happens. So having that peace of mind in coverage, which isn't quite expensive to add on to a policy – the most expensive part is obviously travel medical — is just something to give peace of mind in case something goes wrong.”

Despite this peace of mind, not everyone buys a travel insurance package before their trip. A 2022 survey from insurance software firm Ancileo found about 68 per cent of Canadians planned to buy travel insurance, while Baby Boomers (73 per cent) were most likely to purchase travel insurance.

Still, there are some tricks to travel insurance that can ensure you’re covered in case your dream trip doesn’t go as smoothly as you envisioned. Yahoo Finance Canada spoke to Hands and Suzanne Morrow, senior vice-president at InsureMyTrip.ca, to discuss all things travel insurance.

What kind of travel insurance plan do I need?

Both experts say a base travel insurance package is appropriate for a short road trip or weekend getaway in the U.S., but anything longer or further may need a more comprehensive plan.

“If you're doing any sort of risky activity, maybe you're going skiing overseas, or maybe you’re going paragliding … this is where it gets a little bit more complex,” Hands said. “You'll want to have a specific type of policy that covers more risky activities and medical coverage because standard policies won't do that.”

Additionally, pre-existing health conditions, the cost of the trip, the modes of transportation you will be using and your destination are things to consider before choosing the level of coverage you may need.

Morrow says any trip with a non-refundable portion that has already been paid is a candidate for insurance as a means to protect against cancellation or interruptions.

“If they're planning a trip and they've put money on the line, they may want to have coverage should something happen to cancel their trip,” she said

Read the fine print and check your credit card insurance

Many Canadians will have some level of travel insurance coverage through either their credit card plan or employer, but it’s important to check exactly what level of coverage these plans provide.

“With credit card (travel insurance), anything you want coverage for has to be purchased through your credit card, which makes sense,” Morrow said.

“If it's limited coverage for things that you're concerned about, you may want to look into buying something in the retail market.”

Morrow adds that many employers only offer emergency medical insurance through company benefits, meaning travellers will likely need to look elsewhere for trip cancellation insurance.

“Know what you have so that you can plan for what you may need to buy,” she said.

“The biggest mistake that we hear about is people assume that they are covered. They don't check, they don't verify, they just assume they're good.”

What snowbirds need to know

Snowbirds, or older Canadians who spend their winters in a warmer climate, should consider their own type of insurance package, Hands says. These packages offer multi-trip coverage over an extended stay and include robust coverage for medical expenses, he adds.

“They're all-inclusive, they include a lot of travel medical coverage, because they're designed with an older clientele in mind, so they're expecting them to need potentially hospital treatment, medical supplies, ambulance services, or physician services, or even as much as emergency dental work, or emergency return to Canada,” Hands said.

According to Statistics Canada, as many as 375,000 Canadians spend at least part of their winter in the U.S. or Mexico. The number of snowbirds may soon rise as well, as Canada’s population ages and U.S. officials consider loosening restrictions on snowbird travel.

Hands says snowbirds considering spending more than a month away from home should tell their home insurance provider about their travel plans.

“If you were to leave, and you had nobody checking on your house, or you didn't do the proper precautions in terms of pipes freezing someone and something happens, they can easily reject your claim,” he said.

Ben Cousins is a freelance journalist based in Toronto. Follow him on Twitter @cousins_ben.

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