Financial Tips for Travelers
Summer vacations are supposed to deliver a much-needed dose of R&R. However, vacations can be stressful due to high travel costs, cancelled flights, and other problems. Here are a few tips to relieve a few financial travel dilemmas.
Car Rental Insurance
Paying for insurance can substantially increase the cost of your rental car. Therefore, be careful not to pay for coverage you already have. Before your vacation, call your auto insurance agent AND the credit card that you will use to rent the car. Ask about your personal coverage amounts.
Your auto policy generally covers rental-car damage unless you’ve dropped comprehensive or collision coverage. In which case, the rental car will not be covered if it is damaged in an accident or stolen. In this circumstance, buy the collision damage waiver (CDW) for $10 to $20 per day.
You may also wish to buy the CDW to keep any accidents off your record and avoid the headache of working with your auto insurer. In addition, car-rental agencies may assess a “loss of use” fee, which will not be in your standard auto policy.
Your credit card benefits may supplement your auto policy. Many credit cards will pick up the deductible and premium cards may do more. However, credit-card protection does NOT include liability. In addition, many credit card companies will withhold coverage overseas.
One certain way to save money is to bring your own GPS system.
Travel Insurance
The Icelandic volcano eruption this past April resulted in more than 100,000 cancelled flights. Such situations are considered “an act of God” and the most a U.S. airline will do is provide a cash refund for the canceled portion of your flight. European airlines may provide meals and lodging.
However, if your family of five is significantly delayed on the way to a cruise, you will likely bear the cost of the missed cruise.
Therefore, if you’re planning a tour or cruise that will go on without you, consider a trip-cancellation insurance package. Full coverage for all non-refundable, prepaid travel expenses along with a daily allowance of $150 to $250 for lodging and meals will cost 4% to 8% of your trip’s price.
Some vacations won’t justify the cost of this insurance, but those once-in-a-lifetime travel plans make trip insurance a worthwhile expenditure. Compare plans and costs at InsureMyTrip.com, TravelGuard.com, and SquareMouth.com.
