Does Your Credit Card Offer Enough Travel Insurance?

Is Dan Kriser overdoing it?

"I know that as long as you have a major credit card you don’t need to buy additional insurance when you rent a car," says Kriser, an investment manager from Highland Park, Ill. "But how about trip insurance when you travel?"

Specifically, Kriser wants to know how his credit card -- a United MileagePlus Visa Signature -- stacks up to his Allianz Global Assistance plan.

"Am I buying essentially the same insurance twice?" he wonders.

Answer: they are not the same. And it's an important exercise for the rest of us, who might be thinking of skipping a travel insurance policy for an upcoming trip. Read the fine print before you make any decision.

Credit card insurance may or may not work. I normally hear about it when it doesn't, like Monique Tubb’s case. Her adult daughter was injured while vacationing in Colorado, so she canceled the rest of her trip and flew home immediately.

Tubb thought her UnitedPlus Explorer card’s insurance would help her, but it didn't. Turns out the card only covered "prepaid" expenses.

Travel insiders like Ann Geraci know that you have to carefully review the credit card terms before your trip. Geraci, a travel agent from Northbrook, Ill., notes that her MasterCard covers trip interruption and cancellation due to medical reasons.

"But the hitch is that is MasterCard takes the claim, then must wait 12 months before refunding the amount," she says.

Why so long? Because a ticket has value for 12 months from date of issue, even though the ticket amount is less than the $200 exchange fee in case you wanted to apply to another ticket.

"So, buy the additional insurance if you want, and wait just 30 to 60 days for the refund -- or place the claim with your credit card and wait the 12 months for full refund."

Who knew?

Kriser's question doesn't have a quick answer. If you take a look at the lengthy benefits guide and then compare it to a sample Allianz policy, you'll see why.

The card insurance covers basics like car rentals, trip interruption and cancellation. The standard "named perils" travel insurance policy covers more events, including delays, emergency medical and dental costs, and change fees.

Even when the coverage looks the same, there are important differences.

Consider travel delays. The insurance delay policy kicks in if you're delayed more for six or more consecutive hours for one of the following covered reasons:

? Strike or common carrier delay

? Your departure is delayed by a common carrier.

? Your departure is delayed by an unannounced strike.

? You are quarantined.

? Natural disaster or severe weather

? Severe weather delays your departing flight or causes road closures.

? Politics, violence or theft

? Your passports, money or other travel documents are lost or stolen.

? Your travel is delayed by a hijacking.

? Your travel is delayed by civil disorder or unrest.

Allianz covers prepaid expenses, as well as "reasonable" meals, accommodation and transportation expenses, up to $200 per day.

The card policy only covers equipment failure, inclement weather, labor strikes, and hijacking or skyjacking, but it only kicks in after 12 hours. It pays up to $500 for each purchased airline ticket. And, of course, you need to use that particular credit card to pay for your ticket.

So should you rely on your card's insurance or not? Depends. I hear from a fair number of travelers who wish they had purchased a real policy through an insurance company. But I also hear from folks like Julie Fried, whose luggage was delayed on a recent flight from Baltimore to St. Lucia.

Her airline offered to cover some, but not all, of her expenses.

"We had had many expenses due to our circumstances and spent a few hundred over what the airline allotted," she remembers. "Our credit card told us to submit the rest of our receipts and to write a letter explaining the situation. It covered the difference with no problem."

Bottom line: Read your card coverage carefully when you make your travel plans. If you think you might need more protection, consider buying it.

After you've left a comment here, let's continue the discussion on my consumer advocacy site or on Twitter, Facebook and Google. I also have a newsletter and you'll definitely want to order my new, amazingly helpful and subversive book called How to Be the World's Smartest Traveler (and Save Time, Money, and Hassle).