Insurance for Your Next Dive Trip

A while back, Undercurrent subscriber John S. Wilson (Boulder, CO) planned a Christmas dive trip to Little Cayman with his daughter and son-in-law, paying a deposit of $3,500 each on the trip package in advance. Because he was the "senior citizen" on the trip, Wilson and the other two purchased Travel Guard trip insurance just in case he had some illness or age-related condition that would result in trip cancellation. Ironically, it was his son-in-law who experienced the problem - - he found he had a serious heart problem before the trip and needed immediate open-heart surgery. After receiving documentation from the doctor and the travel agent, Travel Guard refunded all the money they paid for the trip, saving the Wilsons more than $10,000, minus a few hundred dollars each for the insurance premium.

You aren't likely to need trip cancellation insurance if you're just getting into the car and driving 50 miles to the beach. But if you're planning a major dive trip that requires a good deal of money and flight time (especially abroad), it's something to consider, especially now that overseas travel plans have a greater chance of being affected than ever before, due to shaky economies, job layoffs, and dive operators closing shop.

Of course, the need for trip insurance depends on what type of trip you're taking, and what the insurance will and won't reimburse you for. If you're flying to the Florida Keys for a few days of diving, there is less need for it because if you cancel your flight and don't hold a refundable ticket, you can usually apply all but $100 of your ticket to another domestic flight. But if you are making a nonrefundable deposit on a remote liveaboard trip a few months ahead of time, and you can only reach home port on a weekly flight, that is another story.

Age-Based Trip Issues

Trip cancellation and trip interruption insurance can cost between 5 percent and 8 percent of your trip's price. Policy pricing is age-based and there is a penalty for seniors: The cost can run up to 12 percent for travelers 70 and older. "Insurers realize the older you are, the more likely you are to cancel or file a claim for health reasons, so their policy prices are based on that," says Steve Dasseos, president of Trip Insurance Store ( www.TripInsuranceStore.com ). One exception is Travel Guard trip insurance offered by Diver Alert Network (DAN). It says its rates are not-age based, so every diver's policy costs around 6.3 percent of his trip's travel price.

The majority of trip insurance policies offer medical coverage, important to divers over age 65 since Medicare does not cover them outside the U.S. (though some supplemental plans provide foreign coverage). Some travel insurance plans pay coverage for Medicare or Medigap, while others won't. Call your health insurance company and ask about the policy limits.

Choose Your Travel Supplier Quickly - - and Wisely

Trip protection plans generally don't cover you if the travel agency planning your trip financially defaults or goes out of business, says Dasseos. Ideally, the travel agency uses an escrow account to store clients' funds while the money is in their possession. You are not covered for financial default for money the travel agency had failed to pay to the travel suppliers. We've seen three major travel agencies default on divers in the past two decades, the largest of which was Carl Roessler's See and Sea Travel.

Scrutinize the "financial default" or similar clauses when it comes to travel suppliers and carriers. Some, like Travel Guard and Travel Insured, cover you for Supplier Financial Default if you buy your trip directly from the travel supplier and/or if you use a travel agent. On the other hand, Travelex and Travel Safe only cover you for Supplier Financial Default if you book through a travel agent or an online travel supplier, not if you book directly. Many insurers exclude companies in Chapter 11 bankruptcy protection.

When it comes to Travel Guard, timing is everything when you a buy policy from them. Kimberly Krebs (Manchester, MD) found out the hard way. "My husband and I booked a trip to Raja Ampat on the Archipelago Adventurer II for January 2011. We booked the trip in August 2009 and debated on the trip insurance, finally getting it 10 months after booking the trip. When it came time to be reimbursed for the fact that the ship hit a reef and then the company went under, we were not covered by trip insurance because we hadn't purchased the trip insurance within a seven-day window of booking the trip, despite the fact that we bought the insurance months before the incident." Out of pocket and out of luck.

It's also wise to research visas, fees and travel issues to your travel supplier, because you may not be covered by trip insurance if they make a mistake that affects your travel plans. Jonathan Blake (Los Angeles, CA) used the travel agency Classic Blue Destinations in San Jose, CA, to make his travel arrangements to the Andaman Islands for a February liveaboard trip and buy his Travel Guard insurance. After flying into Bangkok, Blake was stopped by a Thai Airlines agent from boarding his flight to India because he didn't have the visas needed to fly into India and his final destination."The manager explained that my travel agent should have processed paperwork for me to obtain a visa to India. He also explained that Thai Airlines was at fault because they should never had let me board the flight in Los Angeles when they checked my passport and issued my boarding passes." Blake missed his flight and therefore his Andaman liveaboard trip. "I later received a text message from the travel agents, saying they were sorry. It was the first time they had booked a flight to India and didn't know about the two visa requirements. They included a phone number to call Travel Guard and my policy number. When I returned home, I contacted Travel Guard and spoke to customer service about the flight interruption. They denied the claim on the basis that it was a documentation error."

Robert Lipka (Cedars, PA) purchased DAN's Travel Guard policy for a summer dive trip to St. Vincent but had to cancel due to illness. When he called Travel Guard, they said his policy number was invalid. "I purchased the $540 policy via the Internet and charged the amount to my credit card. This was all done in January and the burden of proof was on me. I had to contact my credit card and provide proof of payment. My claim is still not resolved. DAN told me the last time I had a policy with them was in 2008, so somehow I got lost in the scuffle. "

Lipka tells Undercurrent he bought the policy directly through TravelGuard's website. So when we called Travel Guard to ask what happened, their spokesperson got back to us in a few days, saying, "Our claims department was in contact with Dr. Lipka earlier this week, and it's my understanding that he'll be reviewing his claims forms when he has an opportunity to do so. We stand by, ready to assist him through this process."

That's why it's important to save any confirmation number or online receipt you receive when you buy an insurance policy via the Internet. You can always challenge the credit-card charges if services are not delivered, and your card company may refund the money.

What if You Lose Your Job?

Travel Guard has upgraded insurance coverage for its four levels and one of the new features includes a provision for layoffs and job loss. Other companies are following suit. Expect to pay about 5 percent for that coverage, depending on the policy and trip.

Typically, these policies return trip deposits if you get laid off but it depends on the policy as well as on your job situation. If you're a company owner, freelance or self-employed, the picture is murkier. And there is more paperwork - - Travelex wants an official note from your human resources department, such as a termination letter.

The Best Trip Insurance in Troubled Times

Most dive sites are safe, but potential terrorist threats and labor strikes could be possibilities. Most insurers say they will reimburse you if a labor strike against airlines, buses or other transit keeps you from embarking on your trip, delays you along the way or forces you to cut your trip short. If a terrorist attack occurs in a place that is on your itinerary, most policies will reimburse you for the pro-rated part of your trip that you don't use, plus expenses you incur to get home. If an attack occurs there within a month before you're scheduled to visit, you may be entitled to cancel your vacation and get your trip deposits back if you have insurance.

But if you're just worried that an attack might occur in your destination, you generally can't cancel and expect to collect. Most underwriters don't want the risk of insuring against such anxiety, says Peter Evans, executive vice president of online travel insurance agency InsureMyTrip.com. "With more than 30 countries recently under State Department travel warnings, the result could be "catastrophic loss." he said. One option for nervous travelers is a "cancel-for-any-reason" rider, which allows you to cancel trips for any reason, or no reason, and receive some money back. But expect to pay up to 50 percent more for that rider.

Randy Brook (Seattle, WA) says Travel Guard reimbursed him for a cut-short trip even though it didn't fit its general reimbursement profile. "During a rail strike in Mexico, my tour operator had to charter a bus to continue the tour, at a cost of several hundred dollars extra per person. Travel Guard's policy covered strikes if they were formal labor protest but not if they were random or wildcat strikes. My only evidence of the strike was a local newspaper report. Travel Guard accepted the claim and reimbursed me for the extra costs."

But if you're in the middle of a travel crisis that is affecting multitudes of travelers at once, don't expect to get service from your insurer right away, says Chrisanda Button and Rickie Sterne (Elkins, AR). "In April 2010, we were among the thousands of travelers stranded mid-journey by the eruption of that unpronounceable volcano in Iceland. When we got off the flight from Denpasar, we expected to be in Singapore for about five hours. We stayed six days. We tried to contact Travel Guard for trip interruption assistance, only to discover its 800 number could not be dialed from a pay phone in Singapore, and our cell phone didn't work there. The Travel Guard telephone menu ate up three minutes of a five-minute calling card. When we did manage to speak to a human being, the agent said he could not help because we did not have a phone number at which he could call us back. To be fair, they were overwhelmed with other customers in our situation. However, Travel Guard brushed off my complaints when we finally got back to the U.S., no thanks to them."

When Your Dive Trip Goes Bad

Divers usually have two big questions about bad-case scenarios on dive trips. What happens if my plane arrives late and the liveaboard has left? And what happens if bad weather wipes out my dive trip?

Before you buy a policy, you need to be clear on what will trigger the plan's coverage for your protection. For example, most of Travel Guard's trip cancellation/interruption policies typically cover flight cancellations due to bad weather conditions, labor strikes and airlines' financial default, but not carriercaused mechanical problems. That is something to keep in mind if you are going to exotic locales like Indonesia and Papua New Guinea. The more remote the dive site, the less frequently planes fly there. Those local airlines are not very predictable and schedules are erratic and sometimes ignored. Insurance is a good idea because if you miss the flight to pick up a liveaboard in the Galapagos or Costa Rica, you're out of luck - - they won't wait for you. And don't expect refunds from the liveaboard if a missed, late or canceled plane leaves you in the lurch.

Trip cancellation or interruption for bad weather doesn't cover rainy days in Cozumel when you can't dive. You won't have much fun, but unless the bad weather prevents you from getting there, you won't have a valid claim. Also important: If you see a hurricane bearing down on your destination, you can't cancel your trip and expect insurance to cover it. Your airline or travel supplier has to be who cancels it. However, if your destination is under an official hurricane warning, you are usually covered it you cancel within 24 hours of departure. Now say you go on your scheduled dive trip to the Turks & Caicos or the Caymans after the storm hit. If the dive resort is inhabitable but isn't what you expected or there are damaged facilities, travel insurance won't cover you. It's the responsibility of the travel supplier to make any adjustments.

Think Before You Buy

Before you purchase trip insurance, write down the situations for which you may need it. If you think you might have to leave a trip early to care for an ailing family member, make sure that's included. If you're concerned that a dive operator may not be financially solvent, book through a travel agent who is on top of things. Get trip insurance through your travel agent, or online through InsureMyTrip.com or TripInsuranceStore.com to ensure you are dealing with a reputable company. All insurance companies have a toll-free number you can call to ask as many questions as you need with. Do that to make sure your butt is fully covered in case the worst happens before you leave, or during your trip.

-- Vanessa Richardson