Protecting your vacation isn’t simply about protecting what you spend on airfare, transportation and hotels, though that’s a big part of it. But it’s also about protecting your own health and safety and your home while you’re away.
Protecting your vacation:
It’s all about what could go wrong on your trip: Where are you going and how long will you be there? Overseas or domestic? Are there multiple destinations? Who’s traveling with you? How’s your health and the health of everyone traveling with you? How much do you stand to lose in airfare and deposits if any stage of your trip is delayed or canceled? What happens if someone steals your wallet? The steps you take should start with a worst-case scenario assessment of all of these aspects first, and one more tip – start this process the minute you start making arrangements.
Check your own protections first: Do you have enough money in your emergency fund to cover any lost deposits or nonrefundable expenses on a trip? Will your own health insurance or Medicare cover any medical expenses at your single or multiple destinations? What protections might your credit card company offer? Will your home insurance actually cover such things as lost luggage on trips? It’s possible you are already paying for coverage that might protect you on an upcoming trip. Make some calls.
If there are still gaps, investigate travel insurance: Travel insurance is typically a good idea for longer, more expensive trips because cancellation for air or ground delays, medical problems or thefts can leave more of a financial impact on an extended trip than a quick weekend getaway. If the trip is outside the country, it’s especially important to check all your existing coverage because most health insurance doesn’t apply internationally. Here are some other things to know about travel insurance:
• Start searching for coverage the minute you make your travel plans: InsureMyTrip.com is a market leader and a good first stop in analyzing coverage – you start by punching in the necessary information on your trip (dates, age of travelers, medical coverage needed, etc.) and it spits back a variety of possibilities at all price levels. Clicking on any of the choices will give you a detailed view of what those policies will and won’t cover.
• Follow up by phone: Understand exactly how various coverages work before you buy. Will cancellation insurance cover a missed hotel stay or will it also cover meal and transportation expenses in the city where you’re stuck? Also keeping the Icelandic situation in mind, see whether weather-related delays or natural disasters are covered. Also ask if your policy covers delays covered by hurricanes. Even if you’re not in a hurricane zone, hurricane activity can cause delays over a wide area. The 2010 hurricane season begins on June 1 and will run through November.
• Be honest about pre-existing conditions: If you’ve recently had surgery or have a chronic health condition, practice full disclosure and make sure your condition will be covered before you buy.
Protect your money while you’re away: Most people travel mainly with plastic these days, but don’t get clobbered with overseas credit or ATM fees. Check with your credit card company and bank to see if you’ll be charged any extra fees, particularly overseas. See if you can have those fees waived. Also, if you become a frequent traveler to a specific location, you might want to open an account at a local bank that has locations where you’ll be. Many multinational banks are right for this purpose.
Protecting your home
Tough economic times may mean that your personal property is at greater risk of theft or vandalism, and the opportunity for those risks go much higher when you’re away. So make sure:
Your home insurance is up to date: If you’ve made any major investments in the structure or grounds of your home, it’s time to update that information with your agent anyway. But mostly, review your coverage and make sure it’s paid up.
Check your home security system: If you have a burglar alarm or any lights or camera systems around your home, make sure they’re working properly. Let your security company know exactly when you’ll be away.
Have someone you trust check your property while you’re away: Make sure this person has keys and security entry codes in case they need to go in to your home or office for any reason. And make sure they know how to reach you.
Check your phone and Internet service before you go: Make sure your cellphone works wherever you’re traveling, particularly if you are going overseas. Also, it’s important to check in with your cell carrier in advance to make sure you understand the cheapest way to make calls home or to use your computer for Internet use abroad.
Protect your computer and documents from thieves: If you don’t have a security password on your home computer, install one. And if you have credit card numbers or passwords programmed into banking, investments or shopping sites, remove them. And if you have a cheat sheet near your desk with every login code you need to operate your life online, lock it up.
Protecting yourself
Make a disaster plan: Nobody wants to start a dream vacation thinking about worst-case scenarios, but doing so could save considerable time, worry and money. Before you leave, make sure you have a battle plan for lost wallets, cell phones and health issues. Make sure your wills and durable and health powers of attorney are current and make similar checks on your disability and life insurance. Have a plan to access your passport number in case your passport is lost or stolen while traveling – make sure you know in advance how to reach the embassy or consulate where you’re going. And have an emergency contact at home checking the State Department website for foreign travel alerts to make sure your family and employer know of your circumstances if there’s an emergency.
Check your health insurance: Again, a health crisis while traveling doesn’t just threaten a vacation. It might threaten your overall financial security. What if your health benefits won’t cross state lines, much less international borders? If the answer is no, see whether your credit card company offers health care coverage there and if so, what it costs and what it entails. The next step is purchasing specific travel health insurance that will be accepted at your destination, which may be sold in a package with other coverage. Call the concierge at your destination to get information on the best nearby hospitals and clinics so you can check if your coverage applies, and see what ground or air transport options exist to get you to the best hospital. Transport can be costly if you’re in a remote location. Keep in mind that travel health insurers will demand to know about recent surgeries and pre-existing conditions.
May 2010 — This column is provided by the Financial Planning Association® (FPA®) of Puget Sound, the leadership and advocacy organization connecting those who provide, support and benefit from professional financial planning. FPA is the community that fosters the value of financial planning and advances the financial planning profession and its members demonstrate and support a professional commitment to education and a client-centered financial planning process. Please credit FPA of Puget Sound if you use this column in whole or in part.
The Financial Planning Association is the owner of trademark, service mark and collective membership mark rights in: FPA, FPA/Logo and FINANCIAL PLANNING ASSOCIATION. The marks may not be used without written permission from the Financial Planning Association.
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