Insurance Industry Notes

Cancellation Waivers Can Save Vacation

After the terrorist attacks of Sept. 11, 2001, many people didn’t want to fly. If they had already bought airline tickets for a vacation, they lost those tickets if they didn’t take the trip.

That prompted tour companies to come up with a cancellation waiver. It allows travelers to cancel for any reason, said Frances Mayo, co-owner of Around the World Travel in Springdale.

Tour companies offer cancellation waivers for trips through Around the World Travel for a flat rate of $59 to $99. If the traveler decides not to go, for whatever reason, the cost of the trip is refunded minus the amount of the waiver.

Standard travel insurance usually requires a medical reason for cancellation and often excludes natural disasters. With hurricane season approaching, that could be a problem for people traveling to Florida or the Caribbean.

Mayo encourages travelers to read the fine print of their travel insurance policies.

“I definitely highly recommend travel insurance,” Mayo said. “I think it’s important that the traveler knows what it covers.”

Mayo said Around the World Travel uses Travel Guard of Stevens Point, Wis., for travel insurance.

Cancellation waivers are usually available with package deals from major tour companies such as American Airlines Vacations, Travel Impressions, Worryfree Vacations or Delta Vacations.

Mayo said she believes travel insurance and cancellation waivers are a good deal as long as the cost doesn’t exceed 10 percent of the cost of the trip.

“Folks with little kids need to get the insurance,” Mayo said. “If that kid gets sick, that mama ain’t going to go [on vacation].”

— Bill Bowden

Read the Fine Print

After Hurricane Katrina hit the Gulf Coast many people discovered they didn’t have the insurance coverage they thought they had. Some had coverage for wind damage, but not floods or the other way around.

The standard form from ISO Properties Inc. that is used by many Arkansas insurers lists the following as exclusions to the basic homeowner’s policy: earth movement, including sinkholes volcanic eruption governmental action, such as seizure of property, nuclear hazard, failure of utility services, war and military action, flood and fungi.

If you want coverage for any of the things listed above, be sure to ask for it. Of course, you will be charged an additional amount for that coverage.

In some cases, there will be exclusions to the specific policies. For example, flood policies often don’t cover water damage caused by water seeping through a wall because of a blocked gutter.

— Bill Bowden

Medicare Deadline Passed on May 15

The deadline for Arkansans aged 65 and over to sign up for the Medicare Benefits Program was May 15. Enrolling now will result in a penalty.

The Centers for Medicare & Medicaid Services estimates that 37 million of the 43 million seniors eligible for Medicare have already signed up for the plan.

Seniors are urged to enroll even if they don’t take any medication, because their needs may change.

If Medicare-eligible Arkansans didn’t enroll by the May 15 deadline, there will not be another opportunity to enroll until Nov. 15. Coverage would not begin until Jan. 1, 2007. As a consequence for late enrollment, premiums increase 1 percent per month for any Part D participant who misses the May 15 deadline, which means people who miss the deadline and sign up in November will face a 7 percent monthly penalty.

Assistance in choosing a Medicare plan is available by calling (800) 633-4227 or visiting Medicare.gov.

Click here for a list of the largest health insurance companies and property and casualty insurance companies in the state.