Travel insurance is the most popular and effective way of protecting the money you’ve spent on travel. Purchasing travel insurance can protect airfares, cruise bookings, hotel reservations, tours, theater and theme-park tickets, rental cars, and many other prepaid travel expenses. Travel insurance can also include emergency health and medical evacuation coverage, as well as coverage for lost luggage.

Purchasing travel insurance can be expensive, and if you’re trying to cut corners and not overspend, you might be wondering if travel insurance is worth it.  

Travel insurance protects your travel investment if the unexpected happens. Deciding whether to purchase travel insurance depends on whether your trip is refundable, where you’re going, whether you’ll have health coverage at your destination and if you have travel insurance from your credit card. Here are some key topics to understand when deciding if travel insurance is right for you.

Travel insurance covers several travel-related risks, from flight cancellations to lost bags to medical emergencies. The amount that you pay for your coverage depends on the policy you purchase and where and when you bought it. Most travel insurance providers offer several different policies to choose from with varying amounts of coverage at higher or lower rates.  

You can buy a policy that covers a single trip, multiple trips or you can purchase an annual policy. You can buy an individual policy or one that covers your entire family. There are many companies that offer policies, e.g., Allianz and Travel Guard are some of the most popular.  

Incidents that are 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. A pre-existing condition is any health condition that you have knowledge of prior to purchasing your policy. Some policies cover pre-existing medical conditions if you meet certain criteria. For example, if you purchase the policy within 14 days of paying for your trip and if you were well enough to travel when you booked your trip.

If you are engaging in high risk or dangerous activities during your vacation, you may not be covered. Other incidents excluded from your policy may include war, acts of terrorism and the use of alcohol or illegal drugs. Injuries caused by alcohol and the use of drugs are designated as “self-inflicted.” 

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. 

While travel insurance plans have a list of reasons that can be used for cancellation coverage, “cancel for any reason” (CFAR) insurance means you don’t have to have a specific reason listed. You may simply change your mind and decide that you want to stay home and not travel.  

With a “cancel for any reason” (CFAR) insurance you typically get 50% to 75% of your prepaid nonrefundable trip expenses back, although exact timing and percentages vary by policy.

Most of the time coronavirus-related claims are not covered. Many travel insurance policies specifically exclude claims related to coronavirus. However, some insurers are making exceptions for policies that are already in effect. For example, TravelGuard will cover medical expenses for existing policyholders who get sick with Covid-19 while on a trip. Additionally, they will cover trip cancellation or trip interruption if you get sick with Covid-19 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-19.

Travel insurance primarily covers two aspects of your trip — your reservations and your medical expenses while traveling.

If all 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 weekend getaway that covers an inexpensive flight and hotel may not be worth covering. However, you may want to purchase travel insurance for medical reasons.

Medical coverage may not be necessary if you are traveling in the U.S. and already have a health insurance policy. In that case, you probably already have adequate coverage for illness or injury.

There are two situations in which travel insurance can be worthwhile: to protect your trip and to protect your health.

If you have prepaid for your vacation 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 vacation. Some policies also provide emergency evacuation to escape dangerous situations. For example, if there are tornado or tsunami warnings. However, if you try to purchase travel insurance after the storm poses a risk, the insurance probably will not protect you.

Remember, even if your health insurance covers you outside the country, the medical facility at your destination may not accept the coverage. Without travel insurance, you may have to pay for your medical bills out of pocket and then seek reimbursement from your healthcare provider.

If you already have some travel insurance protection (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.

If you booked your trip through a travel advisor like myself, I always offer travel insurance to my clients. My preferred travel insurance provider is TravelGuard. 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 will also be offered travel insurance.

When figuring out how much travel insurance costs, remember the price you pay depends in large part on the cost of your trip.  

Age, trip cost, plan type, number of travelers, and for some plans destination and trip length are all considered when the cost of your policy is determined.  

Final Thoughts 

Regardless of how much a policy cost, its value to you will be determined when you need it.

When you have a travel emergency, travel insurance will help pay your medical bills, evacuate you, or deal with the hassles involved with interrupting a trip and getting you back home.   

So, the next time you book a vacation, remember the value of purchasing a travel insurance policy may more than justify its costs when the unexpected happens. 

Are you ready to travel again? When you are, remember that Colesville Travel is ready when you are.  

Call us at 301-989-1654 or email us at cindy@colesvilletravel.com for a no-obligation quote on the trip of your dreams.