When you travel by plane, it is only a matter of time until you have this experience. You wait in the baggage claim area when the bags arrive until you realise that you are the only one left. A few stray bags make laps around the carousel, but yours is not there. Whatever chance you’ve left to see your bags disappear that day when the carousel stops turning, and you lug to the luggage service area, feel defeated.
There you don’t get much hope when an indifferent airline employee asks you to describe your baggage size and shape, leaving you wondering what the fancy bar-coded tags were for in the first place. With a little luck, your bag will be delivered to your home or hotel within a few days. But sometimes you never see it again.
Before this happens to you, you need to understand the checked baggage insurance that your credit card offers, as well as other options, and what they will cover.
What is baggage cover?
Luggage cover (also called luggage insurance and luggage insurance) covers you for loss, theft or damage to your bag. It is usually included with standard travel insurance, but it is always a good idea to check that the level of cover is appropriate for your needs (and your baggage).
What the airlines owe you in the event of loss or destruction of your luggage
Most passengers assume that the airline will compensate them if their baggage is permanently lost or destroyed during the flight, but airlines severely limit their liability for lost or damaged checked baggage. First, it can take weeks for an airline to recognise that a bag has been irretrievably lost. Then each airline has a long list of items they do not cover at all – even if the loss was their fault.
Once a claim is made, the airlines do not immediately and automatically pay the full amount of the claim. Instead, they write off the value of your clothes and other items in your bag based on your estimate. This means you will not get the price you paid or even a replacement cost for the items in your bag. Airlines may also request receipts or other documentation to substantiate your claim, so if you do not have extensive records with you when you travel (and who does?) you can expect to have some time to negotiate with them.
Once a claim has been accepted, it can take between four weeks and three months for a traveller to pay for the lost baggage. In many cases, the airline will offer an arrangement that includes payment in the form of future travel vouchers versus cash.
Why luggage insurance is needed
The travel insurance contains a luggage insurance that covers more accurately the value of the traveller’s luggage and its contents. If the luggage is lost, damaged or stolen, the cost of the luggage and its contents is covered by the travel insurance that people buy before their departure.
The cost of luggage
Baggage insurance is no small consideration when people think about how much their luggage actually costs. Some people spend a lot of money on their luggage. For example, only a Louis Vuitton bag can cost $3,500 dollars. Even if used, it can reach into the $3,000 range. However, the amount of money people receive from the airline might not even cover the price of a bag.
The cost of content
Sometimes people have to take expensive clothes with them. A bride may have planned a dream wedding in the Caribbean and must transport her Vera Wang wedding dress to the location. A used dress can cost up to $3,000, but it wouldn’t be uncommon for a new dress to cost more than $12,000. The $1,500 the bride would receive from the airline would not even fully cover a used Vera Wang dress, so travel insurance is still necessary even if the luggage is not necessarily expensive.
Other advantages of buying travel insurance include
When people take out travel insurance, baggage insurance may cover checked baggage and contents as well as hand baggage and contents. Baggage insurance for hand luggage is all the more important as the airline is not obliged to reimburse people if something happens to them.
It is up to the passengers to set the limits for their baggage insurance. For example, if they are convinced that the value of their baggage and its contents is $5,000, they can take out travel insurance with baggage insurance that covers them up to that amount. The deductible they pay for this insurance applies to a single trip or multiple trips throughout the year.
What do I need to report baggage loss or delay?
Travel insurers will always require documentation of the value of lost baggage items to determine the amount of reimbursement to which you are entitled.
In the event of lost baggage, you may be required to produce the original receipt to receive a refund for higher value items (typically over $150 in value). Some insurance providers will provide the actual cash value if you cannot provide a receipt.
For baggage delays, you must prove that everything you have purchased is a reasonable expense and within the limits of your policy. It is highly recommended that you keep receipts for everything you purchase while your bags are delayed.
What does “excess policy” mean for my baggage cover?
The deductible of an insurance policy is the amount you must pay per claim for each insured person before the insurer pays anything for your claim. On the luggage cover, this value is usually between £50 and £200, but it varies and may be higher.
When comparing travel insurance, there is always a trade-off between the cost of cover and the level of excess. Often, the larger the deductible, the lower the cost of cover can be.
So be careful when you simply buy the cheapest cover – it could well mean a higher deductible, which could be more than your luggage is actually worth!
Since you can use both the cover offered by the airlines and your credit card, you can receive a refund for most of the items you have reviewed. However, it is important to check your credit card’s baggage insurance policies carefully if you want to rely on their coverage. And if you need to pack items that are worth more than the value of these policies, you should consider buying a surplus rating from your airline.
By carefully considering what these policies cover, and their limitations, you can choose the right combination of cover for your needs.