Question about "refund guarantee" insurance - please help! About This Page:

[LeapDayBaby]

Hi all!

My DS12's 8th grade class is going on a trip to Washington, DC next May. The price for the actual trip ($788) is fairly reasonable given the cost of a roundtrip airline ticket from PVD to DCA, two nights' hotel accommodations, transportation around the city during the trip and admission to places like the Smithsonian, so I'm fine with that. My concern is the "refund guarantee" insurance that is being tacked on to the price of the trip. The agency organizing the tour is charging $100 for this "refund guarantee" insurance, which supposedly ensures that we'll get our money back if the trip is canceled for any reason.

An additional $100 (almost 13% of the cost of the trip!) for this feature seems excessive. Should we decline this and look into purchasing travel insurance elsewhere?

Thanks in advance for any guidance!!

- Laurie

[OffKilter_Lynn]

That is high but my question is more to the actual coverages. Are they listing specific coverages for trip insurance / baggage / cancellations / delays or is it simply an assurance that they'll refund your money should the trip be cancelled?

Sad to say, they could be two entirely different things.

Do you have the option of declining the coverage? Many times it's built into the package and can't be removed (it's a way to make their price seem lower and a better bargin to the trip organizers). If you're able to remove that coverage and insure your trip elsewhere, make sure you won't be charged any fees from the supplier for insuring elsewhere.

And by the way... there isn't any admission fee for any of the 14 Smithsonian Museums or National Zoo! If they're charging you an admission fee for something that's free, beware!

[LeapDayBaby]

Hi Lynn!

First off - thanks for the heads-up about admission (or lack thereof) for the Smithsonian! That's good to know

I fished out the flyer that came home with DS, and here's what it says about the Refund Guarantee Program: "It is designed to guarantee a refund, minus the cost of this program, if it is necessary to cancel at any time prior to departure for any reason (by you, the trip coordinator, school or school administration)." It doesn't mention anything about flight delays or cancellations by the airline.

It is an optional coverage, so we don't have to participate, but their cancellation policy if you don't participate seems harsh (even if you cancel 60+ days before departure, they get to keep our deposit of $150). It doesn't look like we'd be penalized for insuring elsewhere.

The tour company is also reserving the right to increase the cost of the trip if there are "imposed increases in air, rail or motorcoach fare" (including fuel surcharges). I'm not too happy about that

This is all new to me, so any additional guidance would be much appreciated!! The initial deposit isn't due until October 15, so DH & I have got some time to decide what to do

Thanks again,

- Laurie

[dmpyron]

Laurie, what Lynn says is spot on. This isn't insurance, it's really nothing more than a guaranteed profit. I don't normally recommend travel insurance for domestic travel, although for some people it makes some sense. I'm assuming he already has health care coverage, so you don't need that. If you choose to cancel because you've changed your mind, most policies don't cover that unless you really want to pay for it. Paying $100 to avoid losing $150 really means that you would only get back $50. Are they saying that if the school cancels the trip, you're out the money? That seems pretty harsh. The school is making money on this (I've done enough, I could probably tell you about how much) and someone is getting a free trip out of it. As far as things like air and such, yes, the rates can go up. And they have been. The actual airfare might not go up, but the fuel surcharge could. But this is the case everywhere.

Do you have a copy of the full terms of agreement? This should spell out in detail exactly what you're looking at. And, yes, if they are charging for admission to the Smithsonian museums, start asking hard questions.

[LeapDayBaby]

Dillon,

All we've received is a one-sheet (presumably a "form letter") customized with our school's information. On the back are "General Terms and Conditions". The more I read, the less comfortable I feel

- We have the option of paying for the trip via "Easy Payment Plan", but there's an additonal charge to do so.
- Airline baggage fees are not included in the price of the trip - so unless DS is flying Southwest, his stuff is all going in a carryon
- The cost of the trip includes "accident, illness and accident-related dental insurance" - which seems unnecessary to me, as we have medical and dental insurance! We do not have the option to decline this coverage.

I did look up the tour company on the Better Business Bureau's website, and they have a "satisfactory" rating with two complaints.

I'm so used to planning my own trips that this is all unfamiliar to me. Are these normal provisions of a tour? I'm so confused.

TIA for any feedback,

- Laurie

[dmpyron]

Oooops, a little late getting back. The health&dental insurance is a waste since your own coverage would kick in first and something called "coordination of benefits" would control how much you can recover (this varies by state law). Baggage fees are pretty much an extra on every package these days, as it is collected at the counter when you check in.

You might want to check out Travel Insurance - InsureMyTrip.com for some information on insurance packages.

Is the tour company a local agency or a national company? The company I usually work with for school tours has always done a good job taking care of the students and the schools. But, personally and probably stepping on someone's toes, I think that these things are a nice racket. I get a decent cut for doing nothing more than introduce, the school gets a cut for sending out the mailings and some teachers and parents get a free trip. Errh, "free" trip.