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Travel Trouble: Travel insurance fails families on trips

November 16, 2017 09:10 PM

Are you planning a vacation over the holidays? Perhaps you’re planning a family trip over the winter break. Then this is a story that potentially affects you. It features two local couples' heartbreaking stories. Both planned trips of a lifetime. And because those trips were expensive, they bought travel insurance. But when the unexpected happened and they tried to collect, their insurers said no.  So they Dialed Deanna.

John and Kerry Vagg planned a dream vacation of filled at a lovely Mexican resort for their 25th Wedding Anniversary. 
 
"It was just a matter of finally having a break from our busy lives," said Kerry Vagg.
 
Together they'd raised three kids, rarely taking time for themselves.  In fact, the only vacation they’d had as a couple was a two day jaunt to Vegas for the 10th wedding anniversary.  Now finally, with their kids all grown up they'd saved up for a vacation Kerry called a trip of a lifetime.  They paid for their anniversary trip in full.  It was almost $5000.
 
"My husband wanted to make sure we were gone during our anniversary.  He thought it was really important for us to be there for our anniversary even though it was hurricane season," said Kerry. 
 
They were worried, so their travel agent made a suggestion. 
 
"She said, ‘Oh the travel insurance it covers everything,’ and so we felt good about it.  We paid the extra," said Kerry. 
 
The insurance was $270.  It was peace of mind for the unexpected.  But then, the unexpected happened.  Kerry remembers the day her husband learned the terrible news.

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"Some of the people at his work had showed up to let him know that they had found our son who had passed,” said Kerry. Their oldest child, the boy who grew to be a big man with a very big heart was dead at 24 following a heroin overdose.  His parents were shocked and heartbroken.  Their son Cody had struggled with opioid addiction, but they believed he’d beaten it.
 
"My son had been doing very well. He had not used in two years," said Kerry. 
  
 Now Cody was gone.  And on the very day his parents had been scheduled to leave for their anniversary trip his mother was doing something very different.
   
"I was burying my son that day," said Kerry. 
 
This, his parents say, was a tragedy they did not foresee - a tragedy they believed would be covered by their insurance, Berkshire Hathaway Travel Protection.  After all, the policy says it covers cancellation if it occurs because of the serious injury, death, or sickness of a family member.  But when she called her insurance representative she got sobering news.

"She read another byline in the contract which stated that if it was intentional or suicide that our contract would be null and void; therefore, we would not get any money reimbursed to us,” said Kerry.

"In my lifetime, I don't think any insurance policy ever covered that," said Lynn Di Maria.  Di Maria has sold travel insurance for decades as owner of Di Maria Travel.  But she argues this case could be different.

"This young man was not trying to harm himself. It was an addiction," said Di Maria.  It's an argument that might support payment of their claim.  

Mike and Alyssa Ranalletta are also battling their travel insurer.  The newlyweds planned to honeymoon in February at a resort in the Florida Keys.  But it has not been easy for the couple.  

"About six weeks before our wedding, my mother in law's breast cancer came back.  And within four weeks of it coming back she had passed away."
 
Her mother-in-law died a week before the wedding.  Little did they know she left them some money - a belated wedding gift. They got the letter weeks after her death.

 "It said ‘Use this for something fun for the two of you.’" Alyssa remembered.

The gift from beyond the grave would pay for their honeymoon.  Because their tickets were non-refundable, the couple bought travel insurance offered on Expedia's website.  

“It said, ‘Click here and your flight will be refunded in full,’" Alyssa remembered.

Then in September, Hurricane Irma pummeled Florida.

"It destroyed our resort in Islamorada,” said Alyssa.

Rebuilding will take months.  So the resort gave the couple a full refund.  Next they tried to get the money back for their airline tickets, but their travel insurer refused.

"They had said that the claim was denied because neither me nor my husband passed away," said Alyssa.

In its denial letter, Expedia's insurer said it would only provide a refund for specific stated reasons - one of which is death. Experts agree that Expedia's inexpensive policy that’s sold for $19 as an add-on, is far more limited than most travel insurance plans. 

In fact, News10NBC investigators studied the benefits for a dozen travel plans.  All provided refunds if weather damages your destination making it uninhabitable.  Di Maria agrees the destruction of your travel destination is covered in most travel policies.
 
News10NBC Consumer Investigative Reporter Deanna Dewberry contacted Expedia.  It still said no.  So then, Dewberry contacted Frontier Airlines directly, and it gave and Mike and Alyssa a full refund - more than $500.

As for Kerry, she’s still in limbo. It has requested a death certificate with an official cause of death. The family won’t have that until the county completes toxicology results. Dewberry contacted her insurer – Berkshire Hathaway.  It refused comment citing privacy concerns.  But it has not yet decided whether it will pay her claim. Kerry prays it does.  She has plans for the money.

"I wanted to get the reimbursement to pay for my son's headstone,” said Kerry. "It shouldn't be an issue of giving us our money back.” 

Of course, we'll continue to follow their case and let you know what happened.  The plight of these two families raises the question of whether you should buy travel insurance.  These are the critical questions:

Is the trip expensive?  
Is it pre-paid?  
Is it months away?  
If you answered yes to any of these questions consider travel insurance.  You can expect the cost of a standard policy to be 5% to 7% of the cost of the trip according to the Insurance Information Institute. Older travelers will likely be charged more.  And generally add-on policies that require a click and a small fee have far more limited coverage.

When shopping for travel insurance, here's Deanna's Do List.

1.    Consider searching sites like Insure My Trip and Squaremouth. Both sites list dozens of plans allowing you to compare coverage and price. News10NBC investigators found policies that covered unusual circumstances like cancellation caused by the illness of your service dog, or being called to work suddenly.

2. Consider coverage that at a minimum covers cancellation for illness and death, weather, loss of your job, and your destination is made uninhabitable.

3. Always read the benefit summary and exclusions pages.  Travel Insurance benefit summaries are actually more easily read than most.    

News10NBC Investigator Deanna Dewberry spoke at length with Travel Insurance expert Damian Tysdal.  He operates a travel insurance website called Travel Insurance Review. He stresses that travel insurance policies are Named Peril policies.  That means that everything that’s covered is listed.  If it’s not listed, it’s not covered.

Credits

Deanna Dewberry

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