8 travel insurance pitfalls to steer clear of before your next cruise

Unforeseen events can disrupt your cruise experience, such as flight delays causing missed departures or sudden medical emergencies leaving passengers stranded during port visits. In some cases, cruise lines can face bankruptcy, leaving travelers in difficult situations abroad.

As a consumer advocate, I receive numerous pleas for help each year from distressed cruisers whose trips have gone awry. It always strikes me how much better their situations could have been with a proper insurance policy. Cruise travel insurance can often be a lifesaver when unexpected disasters strike before or during your voyage.

However, this only holds true if your policy includes the right type of coverage. Many cruise passengers fall victim to travel insurance errors and misconceptions, which can leave them either uninsured or inadequately covered when problems arise during their journey.

That's where TPG comes in to assist you. Here are the most frequent cruise travel insurance blunders I've witnessed, helping you make informed choices for your next maritime adventure.

Skipping travel insurance because you assume your cruise will go as planned

One of the most common mistakes I encounter among cruise passengers is failing to consider travel insurance. It always astonishes me when someone mentions they opted out because they didn’t foresee canceling their trip.

This reasoning is often used by travelers who find themselves in costly situations that travel insurance could have easily resolved.

Believing you don’t need travel insurance simply because you don’t anticipate canceling your cruise is fundamentally flawed. Travel insurance is designed to safeguard you against unforeseen circumstances that might force you to cancel or disrupt your journey.

Before dismissing the idea of travel insurance for your upcoming cruise, think about what might happen if:

• You fall ill or sustain an injury before or during your trip.
• You lose your job and can no longer afford to go.
• You or a loved one is hospitalized or passes away.
• Your flight gets canceled or delayed, causing you to miss embarkation.
• The airline misplaces your luggage en route to the cruise ship.

These are just a few examples of unforeseen circumstances that comprehensive travel insurance could cover (depending on your policy). If you lack coverage and find yourself within your cruise contract's penalty period, you risk losing your vacation and your money.

Failing to allocate funds for travel insurance

Another common rationale I hear from cruise passengers regarding their choice not to buy travel insurance is the expense. This can be a shortsighted choice; if something goes awry, an uninsured traveler may end up facing costs far exceeding the price of a robust travel insurance policy.

Imagine if you had an accident during a shore excursion and required medical evacuation. Such emergency services can easily exceed $50,000, depending on where you are. On a recent cruise to Antarctica, I was mandated by Aurora Expeditions to have $250,000 in medical evacuation insurance. Traveling to remote—or even less remote—areas without this coverage could have life-altering consequences in the event of a serious emergency.

If you're planning to invest thousands of dollars in a cruise, it's wise to set aside a portion of your vacation budget for a travel insurance policy that at least covers medical care and evacuation. Failing to do so leaves you vulnerable to medical expenses, cancellation fees, and more.

Purchasing travel 'protection' from your tour operator

Several tour operators and cruise lines offer something called "Travel Protection" or "Travel Waiver," which a sales representative will present to you during your cruise booking. If you book online, a pop-up will typically appear before finalizing your reservation, saying something like "Warning! Protect your investment with our Travel Protection Plan" or "Enjoy peace of mind with Travel Protection."

This product is referred to as travel protection rather than travel insurance because it is a hybrid offering.

The travel insurance sector is strictly regulated. When you purchase a policy from a legitimate travel insurance provider, you are safeguarded by specific laws and regulations. If you encounter issues with your travel insurance policy or a claim, you can escalate your concerns to your state's insurance board.

Crucially, travel insurance companies employ underwriters, providing a safety net for consumers in case something goes drastically wrong with the insurer.

Conversely, if you choose travel protection, many of the safety measures designed to protect consumers who purchase travel insurance will not be applicable to you.

Before acquiring one of these policies, it’s essential to fully understand what you are buying. Travel Protection consists of two key components:

Part A: This component provides predeparture cancellation protection (the passenger's cancellation) and is entirely self-insured by the cruise line or tour operator. There is no underwriter involved. It is often marketed as a "cancel for any reason" policy, but this label is frequently misunderstood by travelers purchasing this product. I’ll elaborate further below.

Part B: This component offers post-departure protection and is an actual travel insurance policy provided by a third-party insurance company. This part of the plan will include medical coverage, emergency evacuation protection, trip interruption benefits, and more.

Since Part A is not classified as a travel insurance product, passengers risk their "investment" if the cruise line or tour operator goes out of business or becomes insolvent. Without an underwriter, if the operator lacks funds to settle claims, there is no safety net. Consequently, customers may be left without recourse.

This unfortunate scenario is exactly what many Vantage Deluxe World Travel customers experienced last June. When the tour operator canceled all future tours and declared bankruptcy, it owed $108 million to about 10,000 customers. Many of these travelers had approved Part A (predeparture) Vantage Travel Protection claims and were awaiting payment when the company collapsed.

Other Vantage customers mistakenly believed that Part B of the expensive travel protection plan would cover them under all situations, including bankruptcy.

Only after it was too late did these shocked travelers read their policies and uncover the harsh reality about that pricey protection: it was worthless if the company lacked funds to settle its debts, and neither part of the plan included an insolvency or bankruptcy clause.

Naturally, this is an extreme example. A typical cruise passenger is far more likely to face a less dramatic issue with this type of travel protection, often related to "cancel for any reason" coverage.

Travel protection policies frequently promote "cancel for any reason" coverage, but the fine print discloses that only a limited number of specific circumstances allow a traveler to cancel and receive a cash refund. For reasons not recognized as valid for a monetary refund, the cruiser will be given a future travel voucher instead.

If you decide to purchase a travel protection product rather than a travel insurance policy, be sure to thoroughly read the entire document and fully comprehend what you are acquiring.

Believing that your health insurance will cover you while on the ship

Ideally, you’ll never have to find out the hard way that shipboard medical care can be incredibly expensive. Many cruise travelers have learned this the tough way after falling ill during their voyage. But the harsh reality hits when the bill arrives: Most domestic health insurance policies — including basic Medicare — do not cover international incidents.

This means that once your cruise ship enters international waters, you are left without medical coverage. Any healthcare expenses you incur during your journey will fall entirely on you.

It’s easy to envision just how costly and distressing it could be for an uninsured passenger who falls ill or gets injured while on vacation. To make things worse, cruise lines and foreign medical facilities demand payment at the time of service. Regardless of the situation, you'll be required to settle the bill upfront.

And I truly mean regardless of the situation. A widow once reached out to me shortly after her husband passed away unexpectedly aboard Holland America's Eurodam.

The heartbreak of losing her partner was compounded by what she perceived as the insensitivity of the crew member who presented her with a bill for her husband's unsuccessful treatment — insisting she pay before disembarking at the next port.

Regrettably, that couple had believed their Medicare plan would cover them during their Caribbean cruise. It did not. (Note: There are supplementary Medigap plans that can offer international health care benefits for Medicare recipients. These plans come with additional costs and may have coverage limitations and caps. Travelers should thoroughly review the plan details before opting for one.)

Although this woman's experience was extreme, accidents and illnesses occur frequently on enjoyable cruises. You don't want the absence of insurance to turn these incidents into even greater disasters.

A comprehensive travel insurance policy can offer not just medical coverage overseas, but also medical evacuation and repatriation — services that can easily run into the tens of thousands of dollars.

Failing to read and comprehend the travel insurance policy

Travel insurance policies can be lengthy and filled with complicated jargon. Many travelers purchase policies that seem satisfactory, often overlooking the specifics. However, failing to thoroughly review and grasp the details of the travel insurance policy you’ve acquired can lead to significant consequences.

There is no universal travel insurance policy. The range of travel insurance options available for cruise passengers is vast, spanning from basic coverage to comprehensive plans.

To fully understand the protections you have, it’s essential to carefully read through your plan's details. Each policy will outline specific covered events. If your trip is canceled or interrupted due to a listed peril, you can file a claim. If the situation falls outside that list, you may not be covered.

It's crucial not only to note the named covered events but also to be aware of exclusions — conditions that could nullify your policy. For example, if you're considering activities like zip lining, bungee jumping, or rock climbing, ensure your policy does not exclude such high-risk pursuits.

The travel insurance industry typically offers a generous review period, usually lasting between 10 to 15 days post-purchase. Always take this two-week timeframe to scrutinize your policy. Don’t rush through the details you find confusing; instead, reach out to the travel insurance company for clarity if needed.

If you find during this review period that the policy lacks the coverage you need, you can ask for a refund and continue looking for a suitable option. Once this window closes, your travel insurance policy becomes non-refundable and cannot be altered.

Delaying the purchase of travel insurance for your cruise

One frequent error made by cruise passengers is postponing the purchase of travel insurance until it's too late.

As a general guideline, if you plan to insure your trip, you should secure that coverage when you begin making nonrefundable reservations, such as flights, excursions, pre- or post-cruise accommodations, and any other payments that won’t be refunded if you have to cancel.

Travel insurance coverage generally starts to protect you the day after you buy the policy. This means that any time after your purchase, if a covered event occurs and forces you to cancel your trip, you'll be shielded from financial penalties. However, if you delay purchasing travel insurance for your cruise and an unforeseen event arises, you won't be able to obtain a retroactive policy.

If you reach the cancellation penalty stage of your cruise contract, it's too late to buy travel insurance. In fact, some companies may not permit you to purchase insurance after this date.

Failing to disclose a preexisting condition

Not revealing a preexisting condition can lead to severe repercussions in travel insurance. While it's possible to get a policy that covers preexisting conditions, it requires more effort.

Cruise passengers with preexisting conditions should note that their time frame for purchasing travel insurance is limited. Most insurers mandate that travelers with preexisting conditions acquire insurance within 14 to 21 days after making their initial trip deposit.

If you've been diagnosed with any medical issues in the year leading up to your trip or have a chronic condition, it's essential to:

• Choose a policy that explicitly includes coverage for preexisting conditions.
• Purchase your travel insurance within the first 14 to 21 days after making your trip deposit.

Cruisers who submit a travel insurance claim for a medical issue linked to a preexisting condition face a high risk of claim denial.

Insufficiently insuring the total cost of your cruise package

Travel insurance can considerably add to the overall cost of your cruise getaway. Prices fluctuate depending on the level of coverage selected, the ages of all insured travelers, the duration of the trip, and your state of residence. To ensure complete protection, it's essential to accurately assess the value of your trip.

If you underestimate the cost of your cruise and an issue arises, your claim will only be reimbursed based on the insured value. Travelers who opt for an annual insurance policy should closely monitor the limits of their coverage. It's easy to unintentionally underinsure your cruise if you're depending on an annual travel insurance plan with per-trip or yearly caps.

Cruise passengers should always insure every nonrefundable, prepaid aspect of their travel plans. This includes the cruise fare, airfare, accommodations, and any third-party activities.

Bottom line

Cruise travel insurance offers peace of mind and safeguards against unexpected incidents that could spoil your vacation and drain your finances.

Getting travel insurance doesn’t have to be a hassle. Just follow these simple steps for a smooth experience:

• Utilize platforms like InsureMyTrip or Squaremouth to compare different policies and cruise insurance providers.
• Thoroughly read your policy to grasp what’s covered and the process for filing a claim if necessary.
• Keep a copy of your travel insurance card handy during your cruise, which will include a toll-free number for assistance.
• Have a fantastic cruise.

If you encounter any issues with a travel insurance provider, cruise line, airline, car rental service, or hotel, feel free to reach out to [email protected], and I'll gladly look into it for you.