Should You Buy Travel Insurance And Is It Worth It?
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Travel insurance makes sense if you want to protect the amount of money you’ve laid out for your vacation. But no one can blame you if you’re hesitant to add another expense to your travel budget after paying for airfare, hotels, meals and activities. Still, if you can’t afford to lose that money if something unexpected happens, travel insurance can be a smart investment.
The average insured trip cost is about $5,453, according to Squaremouth, a travel insurance comparison website. The cost for travel insurance was $252, on average. You may be planning to spend much more than that for your dream vacation, or you may be going on a long weekend get-away that costs much less.Typically, the cost of travel insurance is 5% to 6% of your trip cost.
Here are some scenarios where travel insurance can pay off.
What Travel Insurance Covers
Travel insurance compensates you for trip costs and money you spend due to unforeseen events before and during your trip.
Trip cancellation travel insurance
Before you’re even able to finish packing your sunscreen and swimsuits, an unforeseen circumstance could force cancellation of your trip—for instance, if a tour operator goes out of business, you become ill or a family member dies. Travel insurance that includes trip cancellation coverage will reimburse the pre-paid, non-refundable costs of your trip in these kinds of situations.
Furthermore, if you, a family member or a travel companion becomes sick or is injured while traveling, the policy’s trip cancellation feature typically would reimburse you for the unused part of the trip. The trip cancellation benefit could even kick in if you, a family member or a travel companion dies while traveling.
Compare & Buy Travel Insurance
“Cancel for any reason” travel insurance
Note that you can make a claim using trip cancellation coverage only if your reason for canceling is listed in the policy as an acceptable reason. To broaden cancellation coverage, there’s an add-on known as “cancel for any reason” travel insurance (CFAR).
CFAR coverage lets you cancel a trip for any reason and receive partial reimbursement, as long as you cancel at least 48 hours before your scheduled departure. For instance, maybe you’ve opted to stay home so you can attend your high school reunion after all. CFAR coverage typically adds 50% to your standard travel insurance policy cost. Reimbursement is generally 75% of the trip money you lose.
Travel medical insurance for emergencies
Whether you’re canoeing in Argentina or taking a safari trip in Zambia, a medical emergency can certainly put a big dent in your travel mojo. It also can put a big dent in your budget.
Many U.S. health plans offer no coverage outside the country. That means you have to pay for your medical care if you get injured or become ill during your trip—and if you think it’s not likely, think again. Allianz, a travel insurance company, says it receives more than 4,000 calls a year from customers who are experiencing a medical emergency during a trip.
Travel medical insurance covers costs for doctor and hospital bills, ambulance service, medicine, X-rays and lab work, up to the limits in your policy.
Medical evacuation travel insurance
Imagine needing to be airlifted off a mountainside in Switzerland after a hiking mishap, spending a few weeks in a Colombian hospital recovering from a heart attack or requiring a flight back home from Jamaica to treat a broken hip.
It can cost an estimated $15,000 to $200,000 to be transported by helicopter or ambulance to a nearby health care facility for treatment of an injury or illness somewhere in the world, according to Allianz. That does not include the cost of the treatment itself.
Medical evacuation travel insurance covers the expense of being taken to the closest health care facility overseas that’s equipped to treat you, and it also may pay for someone to be flown back to the U.S. for advanced medical attention. Along with medical evacuation, a policy can cover the repatriation, or transfer, of a traveler’s remains to the U.S.
For example, the TripProtector Preferred plan from HTH Worldwide is one of the most generous in the industry, providing $500,000 for emergency medical expenses and $1 million for emergency medical evacuation.
Travel insurance for missed connections
Missing a connection while you’re traveling can be a costly hassle. Missed connection travel insurance reimburses you if you miss a departure for a reason listed in the policy.
This would compensate for a travel delay of, say, three, six or 12 hours caused by something like a mechanical failure on a plane or a storm that prevents a cruise ship from docking on time. The compensation typically would cover the cost of catching up to a tour or cruise.
For example, the Classic plan by TravelSafe provides $2,500 after three hours of a missed connection.
Travel Insurance for flight cancellations
Flight cancellations caused by bad weather conditions, like storms and blizzards are typically covered by flight insurance. However, with flight cancellations becoming more and more common, for a variety of reasons and complications, it may be worth buying travel insurance for flight cancellations
Travel insurance for flight cancellations can reimburse your forfeited, non-refundable trip costs if the reasons of cancellation is not covered by standard travel insurance.
Travel delay insurance
Travel delays are a headache for many travelers. A policy with travel delay insurance can reimburse restaurant and hotel expenses when a flight is delayed due to a reason listed in your policy, for instance bad weather or a mechanical problem. The daily amount of coverage usually ranges from $150 to $200.
For example, Trawick International’s Safe Travels Voyager plan provides travel delay coverage of $150 a day, up to $2,000 total, after five hours of delay.
The travel delay benefit could also cover costs for you to catch up to a destination or go back home, or even may reimburse you for unused trip expenses that are pre-paid and non-refundable.
Baggage insurance
If your luggage is lost, stolen or damaged during a trip, a travel insurance policy with baggage insurance can reimburse you. Homeowners insurance or renters insurance policies can also cover theft of your baggage and belongings.
Baggage insurance also extends to your personal possessions, so if your backpack gets stolen, you can file a claim. Be aware that baggage insurance compensates you for the depreciated value of your belongings and not the amount to replace your stuff with new items. Also, there are exclusions and caps on certain items.
In addition, some travel insurance plans cover baggage delays. This coverage can pay for items you need to buy, such as clothing and toiletries, to tide you over while you’re waiting for your luggage to catch up with you. Note that baggage delay benefits come with a specified waiting time before benefits apply.
Here are some examples of baggage delay coverage from some of the best travel insurance companies in Forbes Advisor’s ratings:
-
TripProtector Preferred Plan: $400 after a five-hour delay Gold plan: $500 after a five-hour delay RoundTrip Elite plan: $600 after a five-hour delay Safe Travels Voyager plan: $600 after a 10-hour delay Select Elite plan: $500 after a five-hour delay
All in all, travel insurance is a small cost relative to the trip costs you can protect—especially when traveling uncertainties and surprises abound.
What Does Travel Insurance Not Cover?
Travel insurance generally doesn’t cover losses due to reasons and circumstances that are within your control. It’s designed to safeguard your trip investment if unexpected circumstances derail your plans.
For instance, trip cancellation benefits only apply if you cancel due to reasons listed in your policy, which are unforeseen events beyond your control. That means you won’t be eligible to file a standard trip cancellation insurance claim if you simply change your mind about going on your trip. For that, you would need CFAR coverage.
You should review the fine print of your travel insurance policy and familiarize yourself with what your policy doesn’t cover because all travel insurance plans have exclusions.
For example, medical claims exclusions often include things like:
- Elective procedures
- Mental health care
- Participation in adventure or extreme activities
- Physical therapy
- Routine physicals and routine dental exams
- Routine pregnancy
Also be aware that travel insurance policies generally won’t cover your losses for a hurricane unless you purchase travel insurance before the storm is named.
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When is Travel Insurance Worth It?
Generally, travel insurance is worth considering if:
- Your trip cost is much more than you can afford to lose
- You are traveling internationally
- You are traveling to a remote area with limited nearby health care facilities
- You are traveling to a hurricane-prone country
- You have lots of pre-paid, non-refundable tours, day trips and activities planned
- Your trip involves connecting flights or multiple destinations
- You want to be compensated for Covid-related cancellations and medical issues when traveling abroad
- You want to be partially reimbursed if you decide to cancel your trip or return home early for any reason
When Is Travel Insurance Not Necessary?
You generally don’t need travel insurance if you’re not putting down large non-refundable trip deposits, or if your health plan will cover you at your destination.
For example, travel insurance may not be necessary if you’re taking a cheap, domestic trip. If you’re going on a long-weekend getaway and staying with friends with plans to see a show and do some shopping, you likely won’t have a lot of pre-paid, non-refundable expenses. And your U.S. health insurance can cover any medical costs if you get sick or injured during your trip. In that case travel insurance may not be needed.
You also may not need travel insurance if your credit card benefits provide travel insurance coverage. It’s wise to check with your credit card company before planning a trip so you’re aware of any applicable travel coverage.
Also keep in mind that some baggage insurance is secondary, which means you first file a claim with your airline or homeowners insurance. You may want to skip baggage insurance if you have secondary baggage insurance, you’re not packing a lot of expensive items and have a direct flight.
Is Travel Insurance Worth It?
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Table of Contents
Table of Contents
Travel can be expensive. Insurance protects your vacation investment if the unexpected occurs. But is travel insurance worth it? The answer will depend on whether your trip is refundable, where you’re going, whether you’ll have health coverage at your destination and how much coverage you already get from your credit card. Here are some key topics to understand when deciding if travel insurance is right for you.
What does travel insurance cover?
Travel insurance covers a number of travel-related risks, from flight cancellations to lost bags to medical emergencies. The dollar amount of your coverage depends on the policy you bought and where and when you bought it. Most travel insurance providers offer several different policies to choose from, with higher or lower levels of coverage and higher or lower prices to match.
You can buy policies that cover a single trip, multiple trips or a full year. You can buy an individual policy or one that covers your entire family. There are many companies that offer policies, with Allianz and Travel Guard among the best-known. Here is a chart showing the benefits and coverage levels available on some Allianz policies.
Emergency medical transport
$300 / daily limit $150
$800 / daily limit $200
$600 / daily limit $200
$1,500 / daily limit $300
Rental car damage/ theft
Covered if certain criteria are met
Covered if certain criteria are met
Covered if certain criteria are met
NerdWallet recently analyzed various travel insurance policies to help you choose the plan that best aligns with your travel goals. Check out our results here: Best Travel Insurance Companies Right Now .
What is excluded from travel insurance?
Incidents not covered by your travel insurance vary by policy and provider.
Pre-existing medical conditions are often excluded from coverage, meaning your benefits don’t apply to claims related to that condition. Some policies cover pre-existing medical conditions if you meet certain criteria, for example if you purchased the policy within 14 days of paying for your trip and if you were well enough to travel when you booked your trip.
Plan on mountain-climbing or engaging in other dangerous activities on your trip? Many policies won’t cover you if something goes wrong. Other incidents excluded from your policy may involve war, acts of terrorism and the use of alcohol, which can cause your injuries to be designated as “self-inflicted,” or the use of drugs, which may be illegal.
If you want full flexibility to cancel your trip you’ll need to find a policy that allows you to purchase a Cancel For Any Reason (CFAR) add-on. This additional benefit does exactly what the name implies and allows you to cancel your trip for any reason. Typically, you’ll get around 75% of your prepaid nonrefundable trip expenses back, although exact timing and percentages vary by policy.
Does travel insurance cover coronavirus-related claims?
In most cases, no. Many travel insurance policies specifically exclude claims related to coronavirus. However, some insurers are making exceptions for policies already in effect. For example, Allianz will cover medical expenses for existing policyholders who get sick with COVID while on a trip. Additionally, they will cover trip cancellation or interruption if you get sick with COVID before or during a trip. But if you haven’t purchased travel insurance yet, the policy you’re considering probably won’t cover you for COVID.
When is travel insurance not necessary?
Travel insurance primarily covers two aspects of your trip — your reservations and your medical expenses while traveling.
If all of your reservations can be canceled without penalty, then trip cancellation or trip interruption coverage isn’t necessary. But even if your trip isn’t 100% refundable, insurance may not be necessary. For example, a cheap flight and hotel stay may not be worth covering, though you may still want to purchase travel insurance for medical situations.
Medical coverage typically is not necessary if you have a U.S.-based health insurance policy and you’re traveling within the U.S. In those cases, you probably already have adequate coverage for illness or injury.
When is travel insurance worth it?
There are two situations in which travel insurance can be worthwhile: to protect your trip and to protect your health.
If you prepaid for your trip and cannot cancel without penalty, travel insurance is probably a good idea. If your trip is canceled or interrupted for a covered reason, this protection will cover your reservations.
If you’re planning to travel to a destination that could have weather-related issues, like hurricanes in the Caribbean, travel insurance may protect your noncancelable reservations. Some policies also provide emergency evacuation to escape dangerous situations. However, if you try to purchase travel insurance after the storm poses a risk, the insurance probably will not protect you.
U.S.-based health insurance policies generally offer coverage anywhere within the U.S. But if you get sick or hurt when you travel internationally, some policies like Medicare may not cover you.
Even if your health insurance covers you outside the country, doctors at your destination may not accept it. Without travel insurance, you could be stuck paying for these bills out of pocket, then seeking reimbursement from your healthcare provider.
If you already have some travel insurance protections (e.g., trip cancellation, trip interruption, baggage delay) from your credit card, consider purchasing a standalone travel medical insurance policy to protect you in case of medical emergencies on your trip.
Where can you buy coverage?
If you booked your trip through a travel agent, you can likely purchase coverage through them. That includes online travel booking engines like Expedia. If you’re taking a cruise , you’re usually offered the chance to purchase coverage during the booking process. Similarly, airlines may offer you certain types of coverage when you book a flight through their website. If you have an award booking , you have travel insurance options too.
Another option: Purchase travel insurance directly through the website of a travel insurance company, like Allianz , AXA or Travel Guard .
How much will it cost?
The cost of travel insurance is based on the specifics of your trip. The best way to get a price is to request a quote through the websites of travel insurance providers. Or you can compare multiple insurers in one place with a consolidator like InsureMyTrip.com or SquareMouth .
Should you rely on credit card travel protections instead?
Many travel credit cards provide certain coverages in case your flight is delayed or canceled, your rental car is damaged, or your luggage is lost or delayed.
Here are a few credit cards offering travel protections that could serve as an alternative to travel insurance.
Up to $1,250 lost baggage.
Secondary rental car protection.
Secondary rental car protection.
$500 trip delay (trips booked after Dec. 31, 2019).
$10,000 trip cancellation (trips booked after Dec. 31, 2019).
$10,000 trip interruption (trips booked after Dec. 31, 2019).
Primary rental car protection.
$10,000 trip cancellation.
$10,000 trip interruption.
Up to $500 baggage delay.
Up to $500 trip delay.
Primary rental car protection.
$10,000 trip cancellation.
$10,000 trip interruption.
Up to $3,000 lost luggage.
Up to $500 trip delay.
$100,000 emergency evacuation.
These are attractive benefits, but the coverage may not be as broad as you would get buying insurance. For example, credit card benefits do not typically protect you in case you are injured or get sick during your trip. Plus, these cards can come with steep annual fees that may be more than you would pay for a travel insurance policy. So don’t sign up for a card just to cover one trip unless you’ve compared costs.
The bottom line
If you’ve paid a considerable sum for a nonrefundable vacation, travel insurance is likely a good idea. International travelers who need coverage in case they get sick or injured should also consider buying a policy. If troubles arise, you’ll be glad that you’re protected.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2022 , including those best for:
Flexibility, point transfers and a large bonus: Chase Sapphire Preferred® Card
Bonus travel rewards and high-end perks: Chase Sapphire Reserve®
About the authors: Lee Huffman is a travel writer and podcast host based in Nashville, Tennessee. He loves to travel with his wife and two children using miles and points. Lee has held the Southwest Companion Pass since 2007 and enjoys being spoiled thanks to his Kimpton Inner Circle status. Read more
Elina Geller is a Lead Travel Writer at NerdWallet specializing in airline and hotel loyalty programs. Her work has been featured in AwardWallet. Read more
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Travel Insurance is a Good Idea
Travel insurance is optional, but for all of our CruiseExperts.com clients we highly recommend it for a variety of reasons you may not have thought of. Most people know it will reimburse you for the cost of you trip if you have to cancel for covered reasons; however, let’s face it, the loss of the cost of your trip, while a significant investment, is usually not life changing. There are however other potential liabilities that if not covered by travel insurance can significantly alter your life. That’s why we offer our clients affordable Travel Insurance plans and we believe that travel insurance is a good idea.
Travel insurance is a good idea
Why we recommend purchasing travel insurance:
Take a look at some true stories from our clients . You may be surprised at what else Travel Insurance covers!
1. Medical Expenses
Did you know that most US health insurance companies do not cover your medical expenses if you’re out of the country. Here are some real life examples of medical expenses travel insurance covers while on vacation.
Son has appendicitis attack . While on a cruise, our client’s teenage son had an appendicitis attack. He had to be airlifted off the ship to a medical facility for treatment, and because he was a minor, his mother had to go with him. If they had purchased travel insurance, the $50,000 medical evacuation expense would have been covered. Their health insurance back home denied their claim.
Heart Attack in Germany . Another client experienced a heart attack in Germany. After spending weeks in the hospital he was not allowed to board a commercial flight to return home; instead he had to pay for a medical evac. transport to get back to the US. If he had purchased travel insurance, not only would his medical care in Germany been taken care of, he would have avoided having to spend tens of thousands of dollars out of his own pocket to get home.
Travel insurance is a good idea
Travel insurance protects you if anything happens to an immediate family member that hinders you from leaving for your vacation. You can get a refund.
Couple cancels trip because of mother’s car accident . A couple we arranged a cruise for were about to leave when they got a call that their mother had been in a serious car accident. The travel insurance refunded the cost of their cruise which they had to cancel.
3. Trip Delay or Flight Cancellations
Travel insurance covers flight delays or cancellations that are out of your control. Cruise lines are not responsible for flight problems and won’t wait for you. If you miss your ship, travel insurance will reimburse you for the cost of catching up with your ship at the next port. A number of our clients have had this experience. The fortunate ones had insurance, some didn’t.
Hotels don’t care if your flight gets cancelled . A couple traveling to Europe had a non-refundable hotel in Zurich. Their flight was cancelled due to aircraft servicing. The travel insurance refunded them the cost of the hotel. We’re very thankful they took our advice to invest in travel insurance.
Travel insurance covers your baggage if it is lost, stolen, damaged or delayed.
Travel insurance is a good idea
No clothes for one week . A group of vacationers heading to Europe were happy they followed our recommendation and purchased travel insurance when their flight was cancelled and their luggage was lost. They were reimbursed the cost for buying new clothes to wear when their luggage was delayed for one week.
At CruiseExperts.com, we understand your vacation is an investment and want your time away to be relaxing and hassle free. That is why we highly recommend purchasing travel insurance. Doing so will give you peace of mind so you can enjoy your time away from your home or office.
Interested in learning more?
If you want to learn more about travel insurance and what it covers, call a CruiseExperts.com agent at 1-888-804-CRUISE (2784) or visit their website, www.CruiseExperts.com.
Julie joined the CruiseExperts.com team in 2013 as the Marketing Coordinator. She’s lived in Visalia, CA for neaqrly 30 years and is a wife and mother of two adult daughters. She holds a Communications/Marketing degree from the University of Illinois (Go ILLINI!) She has been involved in advertising, marketing, public relations, fundraising development, and event planning throughout her career. “I’m thrilled to work with the CruiseExperts.com team! And I love to travel. Put those together and I have the ideal job!”
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Source https://www.forbes.com/advisor/travel-insurance/should-you-buy-travel-insurance/
Source https://www.nerdwallet.com/article/travel/is-travel-insurance-worth-getting
Source https://www.cruiseexperts.com/news/2015/05/13/travel-insurance-is-a-good-idea/