Implementing business travel insurance is one way to minimize the impacts—financial or otherwise—of any unexpected business travel issues, providing peace of mind for you and your employees when they travel.
Business or corporate travel insurance can ease the stress of dealing with sudden travel changes and protect all parties from loss.
These unexpected changes go far beyond flight cancellations or baggage delays. Without corporate travel insurance, any non-refundable fees that you’ve already paid will be lost regardless of what caused the changes – for example, if a doctor advises you to cancel a trip due to a medical condition. This is particularly important for small businesses.
What is business travel insurance?
Business travelers are well acquainted with all the elements of a business trip that can go wrong, such as flight cancellations, lost luggage, and weather-related delays. Be it domestic or international travel, it’s essential for travelers to be prepared for some level of inconvenience during their trips. For business travelers in particular, travel delay can result in much more than just inconvenience. There can be business ramifications such as missed sales opportunities or disappointed customers.
Business travel insurance coverage can provide for emergency medical expenses, work-loss related cancellations and interruptions, travel assistance services, corporate equipment damage, baggage loss, and much more. Corporate insurance travel policies typically include provisions for both medical care and property loss or damage.
If travel disruptions incur financial burdens or schedule changes, most business travelers have the peace of mind that their employers will cover those costs and take care of any additional related needs. As such, corporate travelers' insurance needs may differ from those of the average traveler's comprehensive policy.
How does business travel insurance work?
Like regular travel insurance, business travel insurance can be purchased on a one-time basis to cover a single trip or on a blanket basis, meaning you’re insured for all trips made by your company’s employees throughout the year.
Blanket insurance is the more cost-effective option for companies who send many employees on business trips. With a blanket insurance policy, your company pays a monthly or annual premium based on its level of risk.
Types of business travel insurance
Typically, there are two categories of commercial travel insurance that policies are made under. These categories are domestic and international travel.
These are further categorized into single trip insurance, only covering a trip from the start date to the end date of a single-trip, and multi-trip insurance, covering all trips made within a fixed time frame like six months, one year, etc.
Business travel insurance should cover the following:
- Medical costs
- Property loss or damage
- Travel interruptions, cancellations, and delays
- Luggage
- Identity theft
- Life insurance
- Security
- Personal gadgets
Why does your company need business travel insurance?
Every traveler has encountered cancellations and baggage delays at some point. A single trip can be compromised if there are multiple layovers with international travel. However, there are many other risks that can impact business travel and negatively impact business success. These could include:
- Flight delays and last-minute cancellations causing travelers to miss important meetings.
- An injury or other medical condition causing a traveler to cancel or reschedule a trip.
- Severe weather disrupting travel routes and delaying arrivals.
- Serious illness while traveling could involve an emergency medical evacuation or even a last-minute change to get a traveler out of the country and back home.
- Checked luggage containing important business equipment, presentation materials, or personal items like credit cards may not arrive on time or may get stolen.
Given the dynamic, unpredictable nature of travel, it’s not a question of if but when it will happen. Business travel insurance can reimburse you for non-refundable money spent on air travel or hotels. It can also reimburse the costs of emergency medical treatments when your people are on the road. The key is to make sure you have the right kind of corporate travel insurance plan.
What should your corporate travel insurance cover?
Your company’s specific business travel insurance policy must cover all the uncovered risks your employees are exposed to when traveling. This varies greatly from one company to the next. When choosing an insurance policy for your company, find one that offers flexible, customizable coverage packages.
Below is a list of the most common and important topics your company will want to consider including in its business travel insurance policy. These are typically areas that your company’s existing employer liability and health insurance policies won’t already fully cover.
1. Supplemental foreign medical expenses - With a business travel insurance policy, you can insure employees against foreign medical costs that your company’s normal insurance won’t reimburse. These include higher costs of drugs and healthcare for employees injured on the job in countries like the United States.
2. Designated healthcare provider - Many business travel insurance companies partner with an emergency healthcare provider or network of vetted, local healthcare professionals. This way, insured employees have easier access to reliable healthcare if an emergency occurs while they’re abroad. This service provides peace of mind and ensures employees receive adequate medical attention when they need it most.
3. Evacuation - If an employee has to suddenly return due to a medical emergency, natural disaster, or other unforeseen event, the travel costs can be considerable. This is especially true if the employee must be evacuated from a remote location. Business travel insurance can cover costs of special travel arrangements in such cases.
4. Repatriation of remains - In the tragic event of an employee passing while abroad, bringing their remains home can result in substantial out-of-pocket costs that your company may be liable for. As with emergency evacuations, your company’s business insurance policy can absorb these unexpected expenses.
5. Luggage and company property - Theft or loss of luggage—including expensive company property like laptops, business plans, or prototypes—can result in major setbacks for your company. Make sure your business travel insurer will reimburse you for this.
6. Travel delay expenses - If an employee’s travel is delayed, your company’s business travel insurance can pay for the costs of their additional accommodations, meals, and alternative transportation costs.
7. Supplemental rental vehicle insurance - If your employee has an accident in a rental vehicle, regular rental insurance will only cover up to a certain amount of the damages. Your company’s business travel insurance can cover any extra costs. This can be extremely beneficial if your company regularly rents vehicles to transport its employees and materials abroad.
8. Liability - If an employee causes damage or injury while on the job (e.g. while operating machinery or a vehicle), your company can be held liable. If this damage takes place while the employee is abroad, your company’s regular liability insurance may not fully cover the costs. Business travel insurance can include additional coverage for any gaps in your company’s regular liability protection.
9. Cancellation - Alternative transportation: If a trip has to be canceled due to illness, an accident, or other unexpected circumstances, your company could be charged for unused tickets and accommodations. As with travel insurance for individuals, business travel insurance reimburses your company in such events. If an employee’s flight or other transportation is canceled while they’re on their way to a work-related event, your business travel insurance company can provide alternative transportation.
10. Alternative staffing - If a traveling employee has to be replaced in the middle of a project due to an accident, your company’s business travel insurance can cover the costs of dispatching a replacement.
11. Resumption of assignment expenses - If an employee has returned home due to a medical emergency, your company’s business insurance can cover the added costs of returning that employee to work abroad once they’ve recovered.
12. Foreign workers’ compensation - An employer’s legal obligations toward its employees can vary significantly from one country to the next. If an employee is injured while working abroad, employers may be liable for additional costs or subject to legal action that wouldn’t apply if the worker were at home. Business travel insurance can shield employers from these additional costs.
13. Care for the business travelers’ family - Business travel insurance can also provide benefits to the insured worker in case they’re traveling when their spouse passes away or a medical emergency occurs in their family.
How to choose your business travel insurance
Those who regularly book business travel understand better than anyone that your company has a duty of care toward all its employees, wherever they go.
Duty of care is all about ensuring a safe, healthy work environment, even when your employees are away. International business travel provides companies with unprecedented opportunities for growth and success.
However, it also poses unique risks, both to the health and safety of individual employees as well as to your company’s financial interests. For example, how might an unexpected injury impact a colleague who is traveling in a foreign country where medical services are less accessible than at home?
Or, how could an unexpected travel delay result in lost revenue for your company? The key is to consider every possible outcome based on past experiences from business travelers in your company. It’s important to read through surveys and record travelers’ past experiences.
Check these three factors when selecting your corporate travel insurance:
- What’s included
- Quotes and rates
- Coverage
Keep these factors in mind when selecting your business travel insurance:
- Frequency of travel
- Destination
- Trip length
- Traveler age
- Traveler health conditions
- Coverage size
- Add-on features
- Service and claims history
Insurance for business travel is so important for businesses, especially traveler insurance for small businesses. Covering these risks ensures an extra layer of protection against financial loss, which in turn can prevent serious business impacts during travel.
