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Insuring your nonrefundable airline tickets

You worked hard for your vacation. Then you spent hours making your plans. And since you are on a budget, you picked the cheapest airline tickets, the nonrefundable "use-it-or-lose-it" tickets.

What happens when you don't make your flight because your father has a heart attack or your car breaks down on your way to the airport?

You're out of luck, unless you purchased ticket protector insurance, offered by Continental, Northwest and America West airlines, and several travel Web sites.

Of course, you might still be out of luck, depending on your policy and what made you miss your flight. Ticket protector insurance is by no means a cure-all.

Ed Perkins, travel expert and author of "Online Travel" and "Business Travel: When It's Your Money," calls ticket protector insurance a "lite" version of trip-cancellation and trip-interruption insurance.

"Instead of buying insurance that covers all your bases, like your hotel, car rental or most anything else, you are solely protecting your flight," says Perkins.

Orbitz, Travelocity and Expedia have offered ticket protector insurance for years. The cost is around 4 percent of your ticket cost and it covers a ticket up to $3,000. But before you click, buy and fly, make sure you know exactly what this insurance covers and where you fall under the "covered reasons."

"Covered reasons" uncovered
The covered reasons are very important to understand because it could mean the difference between a full refund and lost money.

Covered reasons usually include medical emergencies, car accidents, terrorist attacks, airline delays or cancellations, natural disasters, death of traveler or family member, adverse weather, airline strikes and jury duty. But those covered reasons may be defined more narrowly than you expect.

For instance, a medical emergency such as a heart attack or a broken leg would be covered. However, if you have an existing condition such as epilepsy and you have a seizure two days before your scheduled departure, you will not be covered. The insurance will not cover you for a medical condition already being treated.

Also, consider weather conditions. Say you are traveling to a hurricane-prone area and a Category 4 hurricane is set to hit your destination just days before your arrival. If you cancel your flight, you will not get your money back unless the airline cancels the flight or the airport is closed.

This was a particular sore spot for Robert Wells and his family, who purchased ticket-protector insurance before their vacation in September 2004. Wells called to cancel his family's flight one day before his arrival airport was closed, due to the incoming hurricane, only to be told that he would not get a refund because he jumped the gun by canceling before the airport was officially closed.

Emily Porter, vice president of marketing for Access America, says most people who purchase ticket protector insurance assume the insurance covers everything. "They need to sit down and read the fine print and understand exactly what is and isn't covered."

Labor strikes also fall under covered reasons, but you already have some protection through a law that requires airlines to honor tickets from competitors in the event of a strike or a shutdown. However, if you were one of the 70,000-plus stranded British Airways passengers at Heathrow Airport recently, the U.S. law had no bearing on your situation.

Next: Changing your mind isn't a covered reason
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