An old golf joke has a guy getting ready to hit a drive, but just standing there and not moving. After a few minutes, an exasperated partner shouts, “For Pete’s sake, hit the ball!” At which point the guy says, “Yes! That’s it—the 50th thing I was supposed to remember.” Why a lame golf joke? Because travel is the same—everybody has a list of “musts” for you to do when you’re arranging a trip. I know I’ve been guilty of posting such lists, and this week I’m looking at just one such item.
The “opt-out” choice you often see can be a trap that never stops trapping. If you don’t make a conscious choice, you could wind up paying over and over for something you didn’t want even once. The trap is not confined to travel; you see it everywhere. But it’s a feature of plenty of travel purchase scenarios.
The most common opt-out option is some form of insurance. When you buy an air ticket or book a hotel room, the website often adds insurance unless you specifically say you don’t want it. That insurance isn’t always a bad deal, but it can be. The last time I arranged an air ticket, the opt-out insurance showed a reasonable price, and it didn’t ask for my age, which meant I wouldn’t get hit with a super-high senior rate. But when I checked the fine print, I found the insurance covered only the air ticket, not any other part of my trip. Clearly, if I wanted to insure the trip, this was not the right policy.
Opt-out collision damage waiver has historically been a problem with rental cars. I haven’t seen it often lately, but when you rent a car, sometimes a rental agent can hand you a contract to sign that is pre-filled to indicate you want to buy the “insurance.” Unlike the airline case, this is almost always a bad buy. The price is high—coming close to doubling the rental cost—and the profit margin at those prices is so high and the actual risk so low that many credit cards offer collision coverage “free” when you use the card for a rental.
This column has suggested a different opt-out trap for travelers renting cars: Rental companies’ daily rates for automatic toll collection systems. The trap is that if you buy into the system, and use it even once, you pay the stiff daily rate for every day of the rental.
- By now you know my general take on travel insurance: Buy enough to cover whatever prepayment and deposit money you have at risk if you have to cancel or postpone a trip. And buy it through a third-party travel insurance broker such as Quotewright.com or Squaremouth.com where you can tailor coverage to meet your exact needs.
- My general take on rental car insurance is similar: Avoid the rental company’s waiver. Your credit card may automatically cover you at no extra fee. Ideally, if you rent often, get a card that offers primary collision coverage, as many now do. And if your card doesn’t cover you at all, buy coverage from a third-party car rental specialist such as Bonzah.com or RentalCarCover.com.
