Is Travel Insurance Worth It?

Travel insurance can provide valuable protection and peace of mind when you’re planning a trip. But is the added expense really necessary? In this comprehensive guide, we’ll explore what travel insurance covers, when it’s worth buying, and how to find the best policy for your needs.

What Does Travel Insurance Cover?

A comprehensive travel insurance policy typically includes several types of coverage:

Trip Cancellation and Interruption Insurance (H3) If you need to cancel or cut your trip short due to covered reasons like illness, injury, or severe weather, trip cancellation and interruption insurance can reimburse you for non-refundable expenses.

Travel Medical Insurance

Travel health insurance covers emergency medical expenses incurred while traveling, which is especially important if your regular health plan has limited or no coverage outside your home country.

Emergency Medical Evacuation

If you become seriously ill or injured and need to be transported to a qualified medical facility, emergency evacuation coverage can arrange and pay for this transport.

Baggage Loss and Delay

This coverage reimburses you for luggage that is lost, stolen, or damaged during your trip, as well as essential items you need to purchase if your bags are delayed.

Other Types of Coverage

Depending on the policy, travel insurance may also include benefits like trip delay coverage, accidental death and dismemberment, rental car coverage, and more.

When Is Travel Insurance Worth Buying?

For Expensive, Non-Refundable Trips

If you’ve paid a lot of money upfront for flights, accommodations, tours, or other non-refundable bookings, travel insurance can protect that investment if you need to cancel or interrupt your trip for a covered reason.

When Traveling Internationally

Overseas travel introduces more uncertainties and potential complications. With international travel insurance, you’ll have coverage for emergency medical care, evacuation, trip interruptions, and other issues that may arise far from home.

If You Have Health Concerns

Travelers with pre-existing medical conditions or those more susceptible to illness may benefit from the added medical coverage and trip cancellation protection that travel insurance can provide.

During Peak Travel Times

If you’re traveling during hurricane season or other peak times when weather disruptions, delays, and cancellations are more likely, insurance can give you added peace of mind and financial protection.

When Is Travel Insurance Not Necessary?

For Inexpensive, Domestic Trips

If your trip is relatively low-cost and mostly refundable, or if you’re traveling within your home country where your health insurance is accepted, you may feel comfortable forgoing travel insurance.

If You Have Credit Card Coverage

Some travel rewards credit cards include trip cancellation, interruption, or delay coverage, as well as lost luggage reimbursement and travel accident insurance. Check what benefits your card offers before buying separate travel insurance.

For Last-Minute Changes of Plan

Unless you purchase a “Cancel for Any Reason” upgrade, standard trip cancellation insurance won’t cover you if you simply change your mind about traveling.

How to Choose the Best Travel Insurance Policy

Consider Your Destination and Activities

Think about where you’ll be traveling and what activities you’ll be engaging in. Make sure to choose a policy that fits your needs in terms of medical coverage, evacuation services, and adventure sports coverage.

Review Coverage Limits

Pay attention to coverage amounts when comparing policies. Look for ample medical, evacuation, and cancellation coverage to fully protect you and your travel investment.

Check for Exclusions

Read the fine print to understand what scenarios and pre-existing conditions may be excluded from coverage. You may also need to purchase additional coverage for certain high-risk activities.

Compare Plans and Prices

Use comparison tools to shop around and get quotes from different travel insurance providers. Don’t just go with the cheapest option – look for the best value in terms of coverage and price.

Purchase Promptly

Many benefits, like pre-existing medical condition coverage, are only available if you purchase your policy within a short time frame after making your initial trip payment (usually 14-21 days). Don’t put off buying insurance until the last minute.

Travel Insurance FAQ

Is travel insurance mandatory?

Travel insurance is not typically a legal requirement, but some tour operators or countries may require proof of insurance. For example, some countries now require insurance that covers COVID-19 medical expenses and evacuation.

What’s the best travel insurance company?

The best travel insurance company will depend on your specific needs, destination, and budget. Some of the highest-rated providers include Travelex, Allianz, World Nomads, and AXA.

Is travel insurance expensive?

Travel insurance typically costs between 5-10% of your total trip cost, depending on factors like your age, destination, trip length, and coverage options. For example, a policy for a $5,000 trip may cost somewhere between $250-500.

What does “Cancel For Any Reason” mean?

The Cancel For Any Reason (CFAR) upgrade allows you to cancel your trip for any reason not otherwise covered by your policy and still receive partial reimbursement (usually 50-75% of non-refundable costs). CFAR typically must be purchased within a short window after your initial trip booking.

How do I file a travel insurance claim?

If you need to file a travel insurance claim, contact your insurer as soon as possible. You’ll need to fill out claim forms and provide supporting documentation like medical records, police reports, or proof of expenses. Your insurer will guide you through the claims process.

The Bottom Line

For many travelers, buying a travel insurance policy can be a smart investment. It provides crucial financial protection against unforeseen trip disruptions and covers emergency medical expenses that your regular health insurance likely won’t while traveling.

When deciding if travel insurance is worth it for your next trip, consider the amount of non-refundable trip costs you’d be on the hook for if something goes wrong. Also think about your health, your risk tolerance, and where you’re traveling.

Ultimately, travel insurance offers priceless peace of mind. It allows you to book your dream trip knowing that if the unexpected happens, you’re protected. You can’t put a price on that confidence and security when exploring the world.