Travel Insurance for Your Luggage

BY Beth Williams

What Does Travel Insurance Cover?

Many of us are tempted to purchase travel insurance just in case the travel gods are not looking after us every leg of our journey. Travel insurance offers some important coverage, however, the theft of your property is another thing.

The Policy

When you buy a travel insurance policy, you need to ask specific questions, and make sure the answers you get are written in the contact. You would not believe how may folks don’t “check the fine print” then find themselves out in the cold when they need to make a claim. Here are a few questions to ask that are specific to luggage insurance:

How much will be paid out should a claim be filed? Does the policy have a max pay out?What is not covered in the claim. This is another big question because each company can vary this coverage. Many times the name of the plan says it all. Is it a “protection” plan or a “travel insurance” plan? There’s an important difference. Insurance is regulated by your state, trip protection isn’t. You may be told that a specific plan is insurance, but is really a protection policy – the contract will tell you the truth.

Is the policy backed by a legitimate underwriter?
Real travel insurance companies are backed by one or more regulated underwriters that are insured and financially healthy. Check the A.M. Best Web site to see current ratings for a provider. The A.M. Best is a worldwide insurance rating and information agency, and any reputable travel insurance underwriter will be rated by it. If it is not, walk away. You may also think about checking the U.S. Travel Insurance Association Web site to see if the company is a member. USTIA has strict legal and ethical standards of conduct.

Have you shopped around?
Don’t take the first policy that’s offered. And that’s particularly true of the one-click come-ons that you’ll find when you book a trip online. Instead, take the time to thoroughly review your options and consult with someone you trust.

Are you aware of any tricky clauses?
Even if your license is backed by a quality underwriter and checks out, it may still be worthless to you. Why? Because of the clauses in your contract that are easily glossed over when you’re buying. No insurance policy will cover you for all possible events and eventualities. The below is a sample of a few travel insurance policies, specifically the sections of the policies that cover lost or stolen items.  This is a list of the items that they do not cover and by what circumstances the theft occurs.  Always review your policy to know its limits. Realize that you may have to rely on your personal homeowners policy for reimbursement.

Samples Travel Insurance Policy No 1:

Condition: The Insured Person should take all practical steps to recover articles lost or stolen. Any items which become the subject of a claim for damage shall be retained for inspection and shall be forwarded to the Insurer upon request at the expense of the Insurer. All such items shall become the property of the Insurer following final settlement of the claim. Any loss which gives rise to a claim under the Policy must be reported to the Police within 24 hours of the loss being discovered. A Police report must be obtained.

What is Not Covered:

  1. The first $50.00 of each and every claim per Insured Person.

  2. Any event occurring from the Insured Person’s negligence, or acting in a non-prudent manner, or leaving personal belongings unattended in a public place.

  3. Money and Valuables must be carried by the Insured or locked in a safe deposit box at all times, and never shipped in checked-in baggage.
  4. Loss or theft which has not been reported to the Police within 24 hours of discovery. See also “Condition” under same section, above.

  5. Loss or damage caused by delay, wear and tear, moth, vermin, atmospheric or climatic conditions, deterioration or mechanical derangement of any kind. Loss or damage caused by spilled fluid from cosmetic or beverage containers whilst in the baggage.

  6. Hired or borrowed property or equipment (except for hired ski equipment when winter sports are selected).

  7. Property of the Insured Person which has been entrusted to a third party.

  8. Claims relating to loss, damage or theft from an unattended vehicle except where the incident occurred between 9am and 7pm local time and where the items were in a locked boot and not visible and where entry was effected by violent and forcible means. The maximum compensation will not exceed $285.00 per vehicle. Loss or theft of valuables and money from an unattended vehicle is never covered. This means if your rental car is ever broken into you are not covered for a loss.

  9. Claims in respect of money for losses arising from shortages due to error, omission or depreciation in value.

  10. Claims arising from confiscation or detention by customs or other lawful officials and authorities.

  11. Claims in respect of documents of any kind, except for passports.

  12. Damage to fragile or brittle articles unless by fire or by accident to a vessel, aircraft or vehicle. Photographic, optical, audio/video and computer equipment, bicycles, watches, sports equipment and ceramic/glass items will be deemed as fragile and brittle. A carrier report stating the nature of the event giving rise to a claim must be submitted.

  13. Loss or damage to or theft of spectacles, sunglasses, contact lenses, suitcases and umbrellas.

  14. In the event of loss, damage or delay whilst baggage has been in the control of a carrier, no compensation will be allowed prior to receipt of compensation by the carrier. In these cases this compensation will be deducted from the cover under this Insurance. If an Insured Person fails to claim from the carrier, the amount payable, if any, under this section will be reduced by the maximum amount allowed by the carrier. A Property Irregularity Report must be provided, clarifying the nature of the incident.

  15. When the items or part thereof are covered by household insurance, the cover under this Policy will be only for the excess and will be paid after receipt of compensation of the household insurance.

  16. Items which have not been noted on the police report, or Property Irregularity Report.

  17. Should any contradictory information or discrepancies concerning a claim, come to our knowledge and could be deemed as an attempt to effect the Insurers judgment on a claim, all benefits under the Policy shall be forfeited.

Samples Travel Insurance Policy No 2:

What is not covered:

  1. any item loaned, hired or entrusted to you.

  2. any loss of personal baggage stolen from an unattended motor vehicle if the items concerned have not been locked out of sight.

  3. theft of valuables from an unattended motor vehicle or from luggage in transit.  (this is the most common theft from travelers on the road yet most insurance polices do not cover car break-ins)

  4. electrical or mechanical breakdown or derangement of the article insured.

  5. wear and tear, moth or vermin, denting or scratching, or any process of dyeing or cleaning.

  6. confiscation or detention by Customs or other lawful officials and authorities.

  7. contact or corneal lenses, dentures, bonds, securities, stamps or documents of any kind, musical instruments, typewriters, glass, china, antiques, pictures, pedal cycles, hearing aids, coupons, computers, personal organizers, portable telephones, televisions, CD players, vehicles or accessories, boats and/or ancillary equipment, samples or merchandise or business goods or specialized equipment relating to a trade or profession.

  8. damage to fragile or brittle articles unless by fire or resulting from an accident to a sea going vessel, aircraft or vehicle.

  9. liability in respect of a pair or set of articles where we shall be liable only for the value of that part of the pair or set which is lost or damaged.

  10. sports gear while in use.

  11. losses from a roof or boot luggage rack (other than losses of camping equipment, which remains covered under this Section).

  12. the Policy excess.

  13. anything mentioned in the General Exclusions.

Portable travel safes provide security and peace of mind–Check them out at: