Travel Insurance During the Sequester

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Travelers have no doubt heard about the possible effects the forthcoming sequester, set to take effect in just four days, may have on their plans.  News outlets across the country have been covering Transportation Secretary Ray LaHood’s statements that the sequester’s budget-cutting measures will eat into the funds used to keep the FAA and TSA functioning at an optimal level.  LaHood noted that  the requirement to place nearly 50,000 travel-related government employees on furloughs would cause a ripple effect, leading to potential delays of up to 90 minutes at peak air travel times, and leaving many travelers stressed or stranded.

With such a dire impact on travel looming, we can only cross our fingers and hope that LaHood’s predictions don’t come true.  However, if they do, it’s worth reminding everyone of the benefits travel insurance can provide in situations of travel delay.

Reimbursement for expenses.  Travel delay coverage on most package policies allows you to file a claim to be reimbursed for necessary expenses, such as food and lodgings, that may result from a prolonged delay.  Note the word “prolonged,” however; while terms will vary by policy and provider, in general, your flight would have to be delayed for 5 hours or more before you’d be eligible for the benefit.  Secretary LaHood estimates delays of 90 minutes, which likely wouldn’t fall under the coverage on many policies, but then again, what begins as a delay of 90 minutes in one airport can end up as a much longer delay somewhere else down the line.

Baggage Loss and Delay coverage. Given the picture of understaffed, overworked, harried airport employees that follows on any talk of furloughs and budget cuts, it’s always possible that there may be a slight uptick in the number of bags that don’t quite end up where they should, when they should.  Likely, no; but possible, yes.  Just in case, it may be wise to review your travel insurance policy’s conditions surrounding baggage loss and delay.  In most cases, your bag will need to be missing for 24 hours or more before coverage kicks in; but once it does, you could potentially get reimbursed for incidental necessities and, in the worst-case scenario, for the replacement of the items lost with your luggage.

While it’s unlikely that the type of delays and inconveniences Secretary LaHood has forecast will cause most travelers to have to reach for their insurance policies, it’s never a bad idea to be prepared.  Situations like this one can, at the very least, remind us to educate ourselves on the benefits of having  travel insurance for unexpected events.  So while we all wait to see if the sequester becomes a reality, take a few moments to review your policy, make note of any benefits it could provide to help you in the case of a lengthy delay, and if you have any questions, feel free to give us a call.

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