How to increase the insured after a policy was purchased?

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Nov 4, 2019
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#1
We have trip cancellation insurance which covers $10K of a $16K trip. We decided to "self insure" the $6K as it was unlikely we would cancel the trip. However, it now seems likely that the tour operator will declare insolvency, which is covered under the insurance we purchased, up to the $10K. Since the tour operator has not yet declared insolvency, could we buy another policy for the additional $6K so that we are fully covered? Would you recommend we buy it from the same or a different insurance company?
 

Neil Maley

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#2
That is tricky. If there are already rumblings that supplier may be going out of business, increasing the policy of might not work- the supplier might be on the insurance company’s radar.

And you might not be covered anyway-if you do not insure the entire trip through the insurance company, the insurance company can void the entire policy.
 

Neil Maley

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#4

Patina

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Dec 22, 2015
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#5
What part of the trip was not insured? Or did you under insure the trip by $6000?

I am not an expert in trip insurance, just have my own experience to rely on. When I have purchased insurance, I buy a policy for what I would lose at the time I purchased the policy. When I add non-refundable expenses to the trip, I increase the policy by the amount I will lose if the trip is cancelled. This way, if I need to file a claim, I have corresponding dates that match with the increased coverage amount. If you underinsured your trip, you probably cannot insure it for the total value later than when you paid for the trip. If I remember correctly, all the policies that I have purchased required me to cover the actual cost of the trip, not a particular portion or dollar amount. So @Neil Maley could be correct that your trip may not be covered at all.
 
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Jan 6, 2015
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#6
What part of the trip was not insured? Or did you under insure the trip by $6000?

I am not an expert in trip insurance, just have my own experience to rely on. When I have purchased insurance, I buy a policy for what I would lose at the time I purchased the policy. When I add non-refundable expenses to the trip, I increase the policy by the amount I will lose if the trip is cancelled. This way, if I need to file a claim, I have corresponding dates that match with the increased coverage amount. If you underinsured your trip, you probably cannot insure it for the total value later than when you paid for the trip. If I remember correctly, all the policies that I have purchased required me to cover the actual cost of the trip, not a particular portion or dollar amount. So @Neil Maley could be correct that your trip may not be covered at all.
Agreed, but I think the "unwritten" exception here is that if the insured claims only the $10,000 they would be fine (my opinion only).
 

Patina

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Dec 22, 2015
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#7
Agreed, but I think the "unwritten" exception here is that if the insured claims only the $10,000 they would be fine (my opinion only).
True. The one time we filed a claim was for medical coverage rather than reimbursement for our travel expenses. When I filed the claim, they required receipts for the entire policy amount. I wonder if, in this case, if the cost of the trip is $16,000 (for instance a cruise) but the insured only covered $10,000, would they have been denied covered in my scenario?
 
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Jan 6, 2015
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#8
True. The one time we filed a claim was for medical coverage rather than reimbursement for our travel expenses. When I filed the claim, they required receipts for the entire policy amount. I wonder if, in this case, if the cost of the trip is $16,000 (for instance a cruise) but the insured only covered $10,000, would they have been denied covered in my scenario?
I suspect it comes down to "proof" (receipts). If you are claiming $,5283, then the receipts must match. If you have one receipt and it says "$6,000", then I would expect the claim to be denied.
 
Likes: Patina
Jul 27, 2018
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#10
I have found that trip insurance premiums increase in steps, so that insuring $5,400 and $5,999 costs the same. So I calculate what I need then round up to just below the policy's premium stepup, avoiding any expensive but slight calculation oops error.
 
Sep 19, 2015
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#11
I think the OP has to look at the policy — some policies require the full amount of trip to be insured.

Neil pointed out one case where the amount of difference was minor.

Was the trip paid for by credit card?
 
Feb 21, 2018
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#12
Agreed, but I think the "unwritten" exception here is that if the insured claims only the $10,000 they would be fine (my opinion only).
I think it comes down to the individual policy.

I am waiting for a reply from Air Canada on refund of seat fees paid for a flight that I could not take due to their cancellation for mechanical reasons. It is a $142 claim. I've already notified my travel insurance to begin the claim process in the event Air Canada refuses the refund.

My travel insurer has requested copies of all invoices paid for the trip to match up to the coverage level we purchased....for the entire trip (cruise and airfare). I suspect if my invoices didn't total up to my coverage limit, they would deny my claim as it would show I didn't insure the total of the trip.
 

Patina

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Dec 22, 2015
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#13
@msmayor exactly. Since my medical claim was the first I have ever filed, I was totally confused why they kept asking for all sorts of receipts that had nothing to do with the medical care I received. I finally got in touch with a manager at the insurance company who explained that the adjusters needed all the receipts that totaled the policy amount before they would reimburse us for our medical expenses. If I couldn't muster up the receipts then the claim would have been denied. Once I provided them with those receipts, a check was sent to me the next week.
 
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Neil Maley

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#14
True. The one time we filed a claim was for medical coverage rather than reimbursement for our travel expenses. When I filed the claim, they required receipts for the entire policy amount. I wonder if, in this case, if the cost of the trip is $16,000 (for instance a cruise) but the insured only covered $10,000, would they have been denied covered in my scenario?
Please read the story I linked to- the insurance can deny if the full trip isn’t covered. If they have a portion of the trip that was $10,000 or under- they should be able to claim. Or they may only receive up to
$10,000. If the policy says the full trip must be insured- they could be out of luck.

NEVER underinsure a trip. If you self insure- you self insure and can be stuck.
 
Feb 12, 2019
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#15
Yes. To be covered for supplier bankruptcy you usually have to insure the full trip within 14-21 days after you deposit.

Here is a story from a few years ago about a consumer who under insured her trip by $2.50 and had her full claim denied.

https://www.elliott.org/blog/travel-insurance-claims-can-hinge-on-the-tiniest-details/4/
Wow. I did not know that. I just made final payment and was looking to do insurance tip cover things like breaking a bone or whatever for the next few months. I wasn't going to include the price of the hotel as it's refundable up to a few days out and my flights are with southwest so I'd get a credit. Guessing I should just add them anyways just in case.
 

Patina

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Dec 22, 2015
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#16
Check with your policy. If you get an airline credit, the policy will pay out minus the credit OR require you to forfeit the credit with the airline.
 
Jan 6, 2015
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#17
Trip insurance coverages can have time limits as show here:
https://www.insuremytrip.com/travel...ges/time-sensitive-travel-insurance-benefits/

Also, regarding trip insurance premiums, I have checked with the company we typically choose and confirmed that they allow both under and over insuring and will pay only the actual costs. For example:

$1300 in receipts, $1500 in coverage pays $1300​
$1300 in receipts, $1000 in coverage pays $1000​
So it seem clear that the answer lies with each company's rules. Still it is wise, I think, to purchase coverage at or above the pre-paid, nonrefundable amount . . .
 
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Feb 3, 2017
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#18
I always check my insurer's Terms and conditions on this issue because I like to get the coverage in time to cover pre-existing conditions but that is always before I have fully booked my trip which I often don't do until very close to travel time.
 
Apr 23, 2018
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#19
Do credit card companies treat tour operator bankruptcies that same as airline bankruptcies? If so, could not the OP buy the additional coverage on a credit card? (Just trying to think outside the box. Or is it called pulling at straws?)
 
Sep 19, 2015
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#20
Do credit card companies treat tour operator bankruptcies that same as airline bankruptcies? If so, could not the OP buy the additional coverage on a credit card? (Just trying to think outside the box. Or is it called pulling at straws?)
That borders on fraud -- like buying insurance when the flames or floodwaters at your door