Travel Accident Insurance: Not As Far-Fetched As It Seems

Sometimes travel accident insurance is a necessity. Travel accident insurance, also known as limited liability insurance, provides a benefit in the event of loss of life or dismemberment, as well as illness or sickness that occurs in relation to traveling.

Where such risk associated with traveling produces a chance for loss or loss exposure, you are able to transfer that risk through the purchase of a travel accident insurance policy. Below are three features related to travel accident insurance.

Types of Policies

There are two specific types of travel accident insurance coverage related to loss associated with travel:

  • Accidental death & dismemberment (AD&D)
  • Accident & sickness (A/S)

AD&D policies provide a principal sum (full benefit) or capital sum (reduced benefit) based on loss resulting from accidental death or loss of limbs, sight, hearing and speech. Accident & sickness plans reimburse the amount of medical expense incurred resulting from illness or sickness associated with travel.

Types of Loss Covered

The types of risks that result in loss that are covered by travel accident insurance can be associated with any of the following activities:

  • Walking (pedestrian) or bicycling
  • Traveling in an automobile (as a passenger or the driver)
  • Using public forms of transportation (i.e. mass transit, bus liner, train, etc.)
  • Commercial airline travel (fare-paying passenger)

Whether you are a pedestrian, commuter, car driver, automobile passenger, or airplane passenger, the loss that may occur because of an accident would be covered under the plan.
Nature of Loss

If you want to make a claim with your accident insurance, the claim needs to meet specific criteria set out by the insurance company.

Your policy will probably require a financial loss or hardship. In other words, if you have a small accident but are able to continue on with your trip as planned, you have no claim. However, if you had to cancel portions or all of your trip, if you had to make expensive alternative travel arrangements, or if you lost the money you spent on your trip when you had to cancel, you may have a the basis for a claim.

The problem must have been accidental. Insurance companies add this provision to specifically prevent fraud by customers who purposely create a situation that results in an injury so that they can make a claim, or to avoid paying when a traveler deliberately injures a partner traveler.

The accident usually cannot be catastrophic in nature. In other words, such natural disasters as a hurricane, tidal wave, flood or tornado are not covered. Generally speaking, a fire that destroys the entire hotel where you are staying would not be covered either, and neither would a bombing. Accident insurance is meant to protect an individual from predictable sorts of accidents.

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