Travel insurance for $25? What’s the catch?

I’m suspicious. I’ll admit it. I’ve seen a lot of “revolutionary” apps and services that simply put don’t know what the hell they’re doing. They have a great idea for a service, but without any of the experience in running that kind of business to actually execute on it. That’s usually the “catch” — a startup has a great idea, and makes a pretty app, but then less than a year later they’re circling the deadpool. With a name like Berkshire Hathaway though, you expect that they might just know what they’re doing.

This company calls themselves Berkshire Hathaway Travel Protection, and they offer a product called AirCare. Simply put: give them $25, and they will insure your trip against common problems. This is not true travel insurance, as it doesn’t cover trip cancellation or medical evacuation, but it does offer protection for the groan-worthy inconveniences we often face while traveling: delays, lost luggage, and missed connections. Anyone who has spent 8 hours killing time in a terminal due to a long-delayed flight will understand. Why yes, $50 to pay for the fancy lounge with free snacks and drinks would be delightful, thanks!


AirCare currently only covers flights within the US, but frankly anyone who travels overseas a lot will know that we’re the world leader in lost luggage and delays. Most other countries simply don’t have so many flights in the air at one time, and don’t run their schedules nearly so tightly, so a delays are not as common. They say that in some instances, you don’t even need to contact them to activate the coverage, as they’ll be notified automatically that your flight has been delayed, or you’ve been on the tarmac for a few hours.

I’ll admit, I was a little confused at first why Berkshire Hathaway was in the travel insurance business in the first place. I know it really only because it’s majority-owned by Warren Buffet, and  has stock that sells for multiple thousands of dollars per share. I know it’s a conglomeration of various different businesses,  but travel insurance seemed a little out of left field. It turns out, one of the subsidiaries of Berkshire Hathaway is a “Specialty Insurance” company, which earlier this year acquired a company called MyAssist that offered concierge travel services to lots of different companies, and was started by the man that started Travel Guard insurance. Ah, now this is starting to make more sense.

You can get the whole run down in this Skift article here. To use the service, simply download their app, sign up and pay the $25.

You can even insure a trip at the last minute, up to an hour before your flight. From their website, it looks like more comprehensive coverage is coming soon.

UPDATE 5-22-2014: Though you need to be licensed to sell insurance in each state separately, I would have thought the bigger states, like California, are ones that you would have sorted out before launching. Unfortunately, that is not the case.  I’ve asked them to give me a holler when they can in fact sell insurance in California.

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