Job-loss policies let travelers book without fear
— -- There's no question the travel industry is hurting big time. As if enduring the most severe recession in generations weren't enough, the H1N1 crisis further dampened advance bookings. So the threat of rising unemployment is taken as much more than a threat by many travel executives.
Thus the emergence of a term you might not have encountered very much in the past: Job Loss Protection. It's why so many travel companies are reassuring you it's okay to book that vacation, even if you're worried about losing a steady paycheck, because your booking will be covered.
In some cases, you can purchase such protection as part of a travel insurance policy. In other cases, travel suppliers—including those that sail as well as fly—are pledging to offer assistance if you suddenly find yourself unemployed.
Burgeoning interest
You can see how poorly the economy has been performing just by viewing all the job loss ads on the home pages of many travel insurance company sites. But those banners carry some good news, in that several of these firms have loosened restrictions on job loss coverage lately, such as shortening the window on how long you need to have worked for the same employer.
John Stone, a spokesman for Travel Insured International, explains, "We found that in the past six months—especially since the financial markets collapsed last fall—job loss protection has become a much more frequent top of mind issue for travelers shopping for travel insurance." He says the decision to amend his company's Job Loss Prevention coverage to allow for a one-year employment clause was influenced in part by increased consumer interest.
So while travel companies have made consumers more aware of job loss, has this translated into more purchases of such coverage? Linda Kundell, a spokeswoman for the U.S. Travel Insurance Association (USTIA), reports, "Anecdotally I've been told that yes, there appears to be an increase in claims and interest related to job loss benefits."
Dan McGinnity, vice president for the insurance firm Travel Guard, says the decision to revamp his company's job loss coverage in March was driven both by consumer demand and feedback from travel industry partners. He notes, "It's one more concern that a consumer doesn't have to worry about." While he advises he can't provide specific sales data on job loss coverage, McGinnity does say, "Certainly we've gotten a great deal of reception. But we haven't seen a great impact yet from a claims standpoint."
In addition to travel insurance providers, other travel companies are offering various job loss programs as well. JetBlue has generated media attention, as has Norwegian Cruise Line. Back in February, Laura Bly provided details about Norwegian's program on this site.
It's also important to realize that some coverage provides cash reimbursement, while other coverage provides credit toward postponing—not canceling—your trip. Obviously this is critical, since many consumers facing sudden unemployment are much more concerned about cash flow than vacationing. "There's a big difference," McGinnity points out. "With a refund you can use it for groceries or your mortgage."
Related Stories
ABC News Live