What Insurance Does a Travel Agent Need?
Whether your business is a full-service travel agency or you are an independent travel agent, you are going to need insurance to cover your commercial risks. Let’s be honest—disasters and accidents happen every day to anyone, no matter how careful they are. You want to be protected. So what coverage do you need for your travel agent business?
General Liability Insurance
Let’s talk hypotheticals:
A woman comes to your travel agency and books a 14-day Cunard cruise to St. Petersburg and the Baltic for four, for a grand total of $43,196. You are overjoyed—and so is the woman. As she pushes her chair back and stands up to go, she trips and falls off the slightly raised platform your desk sits on. She lies on the ground, unable to move, her sobs muffled by the carpet. You quickly call 911 and the ambulance arrives shortly after—the EMTs carefully put her on a backboard.
This simple accident could cost you thousands of dollars—far more than she spent on her cruise. Luckily, you purchased general liability insurance coverage which will cover her medical, ambulance, and hospital costs. This coverage will also pay legal fees for bodily injury and personal injury if she chose to sue you and your business.
General liability coverage also provides personal and advertising injury coverage that will protect you from any misunderstandings. Examples could be a client booking the wrong trip based on your advertising or inaccurate pricing causing them unplanned expenses.
Professional Liability Insurance
Professional Liability—also known as Errors and Omissions—covers mistakes and errors, misinterpretation, or negligence that impacts a client. Whether it’s physical or emotional damages, this coverage protects you from lawsuits initiated by a customer.
Business Owners Policy
A general liability policy is usually included in a Business Owner’s Policy (BOP). A business owners policy is a flexible kind of insurance that is tailored to the needs of travel agents or travel agencies. The policy covers physical business assets such as your offices and other business structures as well as the contents of those structures. They also protect offsite business equipment. It will also protect from loss of valuable papers, electronic data, accounts receivable, and/or income which occur due to damage from fire, natural disasters, or vandalism/theft.
Commercial Auto Insurance
While this isn’t often needed for a travel agent business, if you have a company vehicle, you may want to consider commercial auto insurance. It will protect you or your company if the accident occurred while it was being used for work purposes. This will also include coverage for rental vehicles.
Workers' compensation is required by law in all but Texas, though the state holds the employer responsible for job-related injuries. It would be prudent to invest in a workers' compensation policy for your business. Workers' compensation pays for medications, medical treatment, and loss of wages if an employee becomes injured or ill due to the job.
If the injury results in the employee's death, it will pay standard death benefits to the employee’s family. If the employee is no longer able to work in their current position, workers' comp insurance will pay for retraining for a new career. It will also pay for any legal fees that result if the employee files a lawsuit claiming you or the company was at fault.
Cyber Liability Insurance
Travel agents handle sensitive customer information—Name, address, passport information, payment information, and more. If your website is hacked, cyber coverage will pay for notifying customers, monitoring of credit reports, as well as legal fees and fines.
Another policy you may want to consider adding is Equipment Breakdown Coverage, sometimes referred to as ‘Boiler and Machinery’. This covers mechanical failure as well as damage to equipment such as computers, phone systems, furnaces, A/C Units, etc. due to electrical surges.
If a natural disaster strikes or an electrical surge wipes out your building's furnace or air conditioning and you’re forced to temporarily close—Business Interruption Insurance comes in handy. It helps cover lost wages and profit you would’ve otherwise earned.
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