Since hurricane season is bearing down on us and already causing more problems, I have been back on Stormpulse.com and checking out all the new features they have. The first one is the ability to embed their hurricane tracking maps into other websites. As you can see below we have Hanna who - as of this post - is currently headed toward the southeastern coastline and should make landfall within 40 hours or so.

Whats also new (to me) is the Forecast Models and Wind Probabilities switches on the upper right. So if you are one of the brave souls traveling through Hurricane Alley during peak time you can see the forecasted wind speed probabilities for cities that could be affected. Forecast Models shows different weather models and their forecasts, interesting if you are into that stuff.

Now if you turn on the Wind Probabilities switch you will see a bunch of icons in the storm’s path, clicking on any one of these will show you a box containing the total chances of what kind of wind speeds you could expect, you can dig even further by clicking on the “Chance by Day” button which shows you the upcoming probable wind speeds for the next 5 days.

Being able to see this type of information is helpful both to the last minute traveler - who can see what cities might be impacted and thus avoid potential problems; or for someone who has already booked a trip so they can be better prepared to deal with any potential delays or cancellations due to weather. Hopefully those who already booked have bought travel insurance(we’ll just assume they are smart travelers;), since buying insurance while its foreseeable that the storm will cause them a delay or cancellation will most likely not be covered. The important word here is “foreseeable” since all policies only cover unforeseeable events(don’t be fooled by all this “named event” talk - no policy has a “named event” clause - it has to do with whether it was a foreseeable event).

Every once and awhile a person who has “expert” insurance credentials drifts or stumbles out of their area of expertise and offers advise in areas in which they have no or very little knowledge but because of the credentials people believe them. Just yesterday an article, “Are You Covered?” appeared on the web site for theIndianapolis Star that had two misleading statements that are credited to Bob Hunter, director of insurance for the Consumer Federation of America.

The first comment claims that you can avoid most travel cancellation penalties because

“Most times, businesses will accommodate you in the event of an emergency”.

The basis of that comment is the belief that most travel suppliers (airlines, cruise lines, tour operators) will waive their cancellation penalty because you have an emergency. It would be nice to believe but is it accurate? NO! Why because the cancellation penalty is part of your contract with the travel supplier and they can not arbitrarily impose the penalty in some cases and not in others without being accused of discrimination. Another way of looking at it is why do they have the provision in their contract if they don’t intend on using it.

The second comment claims that you don’t need medical coverage

while traveling in developed countries because “you can usually find affordable local health-care options.”

Let that sink in for a minute… “Affordable local health-care options” while having a heart attack in Paris, or London, or Rome. Sorry, but that is one of the most naive statements I’ve ever heard.

I think Mr. Hunter has proved that he should keep his comments to areas where he has some expertise - it’s certainly not in travel insurance.

On June 2, 2008 the Members of the National Association of Insurance Commissioners (NAIC) announced guidelines that protect life insurance consumers from discriminatory underwriting practices concerning their future travel plans.

One of the hot issues in the past couple of years is the practice that some life insurance companies have employed to deny life insurance coverage to travelers who indicate that they plan to travel to certain country. Several states have already enacted laws that prohibit that practice but now the association that supports and represents insurance regulators, NCIA, has come out with guidelines by including this practice as an Unfair Trade Practice within their Model Act. The model act is used by most States as model for their Insurance Laws dealing with Unfair Trade Practices.

To my knowledge no travel insurance company is involved in these Unfair Practices.

Is flight accident insurance really life insurance? From time to time that question comes up. Usually it comes from a traveler who is not in the insurance business and who makes the assumption that because the flight accident insurance pays a benefit based on the death of the insured that it’s a form of Life insurance. Every once in awhile it comes from a source that should know better.

The answer is no, flight accident insurance is not Life Insurance! It’s a form of accident insurance that will pay a lump sum benefit (principal sum) to a beneficiary in the event that the insured dies as a direct result of an accident that causes bodily injury while they are riding as a passenger, or boarding or alighting from an licensed, scheduled airline.

While Life insurance will do the same thing it is much broader that Flight accident. It will pay a benefit - the amount insured - to a beneficiary in the event of the insureds death, even if the death were due to a heart attack. The death does not have to be caused by an accident in order for coverage to apply.

Isn’t it all the same thing? No, insurance is a highly regulated form of commerce and there is a distinct difference between the two types of insurance. As a matter of fact the various State Insurance Departments that regulate insurance even require different licenses to sell them; travel accident for the flight insurance and life insurance for the life insurance. States can be very sensitive about the difference and in some cases will hold agents in violation of advertising laws if they call flight insurance, life insurance. This writer knows of several cases where agents were required to pay fines for violating State advertising laws because they made the mistake of calling it Life Insurance.

So is Flight Insurance, Life Insurance? NO!

Flight delays and cancellations are in the news right now because of the safety inspections that are being required by the FAA. Questions are being raised as to whether or not there is coverage under travel insurance policies for trips that are being affected.

It really depends on the company and plan that a person has chosen. There are possibly several areas that might offer some coverage;

• Trip Cancellation: this type of coverage involves canceling a trip due to a “covered reason” and provides reimbursement for the non-refundable fees if you have to cancel your tip because of the covered reason. In the insurance industry we call this type of coverage “named peril” because the “peril” has to be named by the insurance company within the policy for the cancellation to be covered. These “perils” are very specific and most trip cancellation coverages would not cover the cancelled flights by AA. Only one company provides for “mechanical” delays of an airline that cause your to miss your flights.
• Trip Interruption: this is almost identical coverage to trip cancellation except you’re already on your trip and a “covered reason” occurs that causes you to interrupt your trip and return home at a time that is unscheduled. This coverage usually pays for the non-refundable, unused portion of your trip and up to the economy airfare to return home. The perils for this coverage are, for most plans, the same as trip cancellation. There are two companies that provide coverage for “mechanical” delays of an airline.
• 
  Missed connection: a few of the plans offer this benefit. It’s designed to provide a modest benefit if there is a delay of more than a couple of hours by the airline in getting you to a connection. It usually provides for additional transportation to get caught up to your trip and additional living expenses. The benefit is usually limited to a maximum amount with some plans offering $500. in total.
• Travel delay: this is a common benefit found in most plans and will pay if a client is already on their trip and there is a common carrier delay of more than X hours (varies from 5 to 12 hours depending on the plan). It provides for additional living expenses while the traveler is delayed and is limited to a per day maximum and a policy maximum. As an example some policies will provide for $150 per person per day for a maximum of $750.

Of the 4 benefits that I’ve listed the most common ones are the missed connection and the travel delay. Statistically, I would think that more people would be impacted who were already on their trip than those just leaving. You should also look at the plan exclusions as some plans that might appear to have coverage might exclude any flight cancellation or delay that is caused by a government action. As always make sure you read the policy provision carefully before you decide which coverage is best for you.