The past three years have visited a host of plagues upon the travel industry: the 2001 terrorist attacks on the United States, airline bankruptcies, a series of hurricanes in the Southeast, and most recently, the tsunamis that all but destroyed the tourism industry in a large part of Asia.

Through these unforeseen events, travelers have witnessed instances in which the thousands of dollars they invested in a Caribbean cruise or weeklong beach vacation have been swept away with the tides – proof, travel agents say, that travel insurance is a sound investment.

“The big thing that people need to realize is that they need to be covered for unexpected losses,” said Merlea Schultz, travel services manager for AAA Minnesota-Iowa, which provides coverage through Access America. “After 9/11, that just happened to bring it more to the limelight.”

Travel insurance providers such as Access America, Travel Guard International, Travelex Insurance Services and Unicard Travel Association offer policies with premiums that run in the tens, hundreds and even thousands of dollars to protect travelers from events – death, illness, injury, bad weather – that are beyond anyone’s control.

Though these policies have existed for decades, travel agents said the Sept. 11, 2001, terrorist attacks and the subsequent effects on the travel industry not only led insurance providers to include terrorism clauses in their policies, but caused travelers to pay more attention to what could be lost if their vacations were canceled or cut short.

“It’s like owning a house without any homeowners insurance,” Schultz said. “If, for instance, you break a leg two days before you’re supposed to leave for vacation and you can’t go, then you have lost everything that you have saved for so long.”

With that in mind, travel agents are continuing to urge people to protect their investments. At AAA Iowa and International Travel Associates in West Des Moines, clients who have booked a trip through an agent do not walk out the door without first receiving information about travel insurance.

“Penalties are very high when people buy package trips, and if they can’t travel, sometimes they lose all of their money,” said Mary Phillips, retail travel supervisor at International Travel Associates.

Providers offer policies ranging from comprehensive to more specific plans, such as health-care coverage. Phillips said most people opt for a comprehensive policy because their existing health-care plans will cover them even while traveling overseas. Senior citizens are the more likely market for the health insurance, because Medicare’s coverage does not extend into other countries.

“Travel insurance is not designed to protect people against what we call a ‘bad hair day,’” Schultz said. Some people buy a policy with the false expectation that if they decide they don’t want to go on their vacation or can’t afford it, they can file a claim and be reimbursed by their provider.

Travel insurance policies primarily cover trip cancellation or interruption, accidental death or dismemberment, medical or dental expenses, emergency medical transportation, loss of luggage and protection against the default or bankruptcy of suppliers. Schultz said that many travelers ran into issues regarding supplier default when several cruise lines went out of business following the 2001 terrorist attacks.

Other options can include personal liability coverage for damages, legal defense, repatriation of remains and bad weather. Access America expected its customers to receive approximately $1 million in claims, primarily due to trip cancellations, interruptions or delays, related to the hurricanes that struck the Southeast in 2004. To have a valid claim, travelers must have purchased the policy before the hurricane was in the forecast.

The cost of these policies is based on a sliding scale, typically dependent upon the cost of the trip and the age of the traveler. Phillips said someone who is 35 years old or younger taking a trip valued at $500 or less could purchase a policy for $25. But an 80-year-old who takes a $9,000 trip would have to shell out $1,100 for travel insurance, all of which is paid directly to the insurance company.

Emergency relief

World Access, the parent company of Access America, a travel insurance provider, has had a 30 percent increase in its call center volume due to claims from travelers who were affected by the Dec. 26 tsunamis.

The company said it has been working on behalf of companies such as AAA Iowa that provide Access America travel insurance. Along with mobilizing medical help to Thailand, Singapore, Sri Lanka and the Maldives, World Access has provided around-the-clock emergency communications assistance and transportation to medical facilities. In addition, Access America has arranged commercial flights, primarily to Singapore, and other evacuation resources for its clients. It also has been working with local governments to repatriate survivors and deceased loved ones.

Jon Ansell, World Access president and CEO, said any number of travel insurance providers, in similar instances, can facilitate communications, make medical and transportation arrangements and coordinate the replacement of important documents, such as passports and personal identification.