Check your existing insurance policies and credit card coverage before you buy travel insurance. You may already be covered for lost luggage, canceled tickets, or medical expenses. The cost of travel insurance varies widely, depending on the cost and length of your trip, your age, your health, and the type of trip you're taking.
Purchase insurance from a broker, or directly from an online or telephone-based insurer, as it is invariably considerably cheaper than that sold by travel agents, banks, foreign exchange operations, or insurers at the airport.
Trip-Cancellation Insurance -- Trip-cancellation insurance helps you get your money back if you have to back out of a trip, if you have to go home early, or if your travel supplier goes bankrupt. Acceptable reasons for cancellation can range from sickness to natural disasters to a government department declaring your destination unsafe for travel. Insurers usually won't cover vague fears, though, and in 2003 SARS wrong-footed many travelers.
Medical Insurance -- For China, purchase travel insurance with air ambulance or scheduled airline repatriation built in. Be clear on the terms and conditions -- is repatriation limited to life-threatening illnesses, for instance? While there are advanced facilities staffed by foreign doctors in Beijing and Shanghai, and excellent facilities in Hong Kong, in most of China a hospital visit is to be avoided, if possible. Foreigners unfortunate enough to end up in provincial facilities do tend to get special treatment, but you are unlikely to consider it special enough. You may also face a substantial bill, and you will not be allowed to leave until you pay it in cash. You must claim back the expense when you return home, so make sure you have adequate proof of payment.
Lost-Luggage Insurance -- On U.S. domestic flights, checked baggage is covered up to $2,500 per ticketed passenger. On international flights (including U.S. portions of international trips), baggage is limited to approximately $9 per pound, up to approximately $635 per checked bag. If you plan to check items more valuable than the standard liability, see if your valuables are covered by your homeowner's policy, or get baggage insurance as part of your comprehensive travel-insurance package. Read the policy carefully -- some valuables are effectively uninsurable, and others have such high excess charges that the insurance is not worth buying.
If your luggage is lost, immediately file a lost-luggage claim at the airport. For most airlines, you must report delayed, damaged, or lost baggage within 4 hours of arrival. The airlines are required to deliver your luggage, once it's found, directly to your house or destination free of charge, although don't expect that necessarily to work with domestic Chinese airlines.
