Is travel insurance worth it in 2024? (2024)

Key points

• Is travel insurance worth it? A comprehensive travel insurance policy can cover the cost of canceling or ending a trip early, lost or damaged luggage and emergency medical care.
• Travel insurance can be valuable when the upfront costs of your trip are nonrefundable.
• A travel insurance policy can be especially helpful overseas if your U.S. health insurance won’t cover emergency medical treatments abroad.
• A comprehensive travel insurance policy typically costs between 5% and 10% of the total price of your trip.

Learn more about what types of travel insurance coverage are available, when you may want to consider a travel insurance policy and how to purchase the best plan for your travel needs.

What does travel insurance cover?

Travel insurance covers a wide spectrum of issues that can go wrong, ranging from lost or delayed luggage to emergency medical evacuation. Buying a comprehensive plan can help you cover your bases and protect your finances should the unexpected occur before or during your trip.

A comprehensive travel insurance policy will include several types of coverage, including:

• Trip cancellation insurance.
• Trip delay insurance.
• Trip interruption insurance.
• Travel medical insurance.
• Emergency medical evacuation insurance.
• Baggage insurance.

Coverage varies by company and by plan, so it’s important to carefully read your travel insurance policy to fully understand what is included and excluded.

More: Best Travel Insurance Companies

Cancellations, delays and interruptions

Trip cancellation insurance

This popular insurance covers 100% of the cost of prepaid and nonrefundable expenses you may miss out on if you have to cancel your trip, as long as you’re canceling for a reason listed in your policy.

Trip cancellation insurance can reimburse you if you miss your trip due to a covered issue, which could include:

• Death, illness or injury to you, your traveling companion or a family member.
• Extreme weather and natural disasters.
• Flight cancellations.
• Legal obligations, like jury duty or a subpoena.
• Strikes that result in travel services not being able to operate.
• Terrorism.

Travel delay insurance

Travel delay coverage reimburses you for expenses that arise from delays in your trip, as long as the problem is included in your policy. Covered incidents typically include airplane mechanical failures and inclement weather, but may also cover instances of delays caused by stolen passports or traffic that causes you to miss your flight.

This coverage typically kicks in after a certain number of hours and offers a per-day maximum amount to help with meals, travel and accommodation.For example, if your flight was canceled and the next one doesn’t leave for 18 hours, your trip delay insurance may cover your dinner and a hotel room for the evening.

Policies vary, with some providing benefits earlier than others. They also have caps, such as $500 per person, so make sure you understand these limits before buying coverage.

Trip interruption insurance

No one wants to end their trip early, but unexpected events like illness or injury can force you to do so. Trip interruption insurance will reimburse you for unused prepaid expenses such as flights, excursions, lodging and meals that will be lost if you need to head home early.

Reasons covered by trip insurance typically include sudden injury or illness to you or your travel companion, the death of a family member back home or severe weather at your destination.

Every policy differs and has exclusions, so carefully research to find the best option for your needs.

“Cancel for any reason” coverage

Travel cancellation insurance covers a bevy of trip issues, but what if you want to cancel for a reason not listed in your policy? “Cancel for any reason” coverage is a travel insurance add-on that typically provides up to 50% or 75% reimbursem*nt if you cancel, regardless of the reason.

So if the weather forecast is filled with rain or you’re no longer on speaking terms with your traveling companion, “cancel for any reason” lets you forgo travel without losing all of your money.

The catch is that you typically need to cancel at least 48 hours before your scheduled departure time, so you can’t cancel at the last minute.

Reimbursem*nt amounts for prepaid and nonrefundable amounts vary, so review policies to find a policy limit that works for you.

Medical care and emergencies

Travel medical insurance

If you’re injured or suffer from an unexpected or sudden medical condition or illness while traveling, travel medical insurance can help you pay for care. Covered expenses generally include X-rays, medicine, doctor visits and hospital bills, lab work and other related expenses you may incur.

It’s important to consider this type of coverage if you are traveling abroad. Medicare does not provide coverage outside the country, and the same is true for many U.S.-based insurance plans.

Not all medical expenses are covered by travel medical insurance. This type of coverage will not pay for routine care, and though plans may cover pre-existing conditions if you get a pre-existing medical condition exclusion waiver, each insurer handles them differently. Always review coverage and exclusions if you have a health condition and are looking for medical coverage abroad.

You’re also unlikely to be covered if you sustain injuries while intoxicated or while engaging in high-risk activities, like mountain climbing or skydiving. Some travel insurance companies, such as Travelex, offer adventure sports upgrades that are worth considering if you’re planning an active vacation.

Emergency medical evacuation insurance

Baggage insurance

Baggage loss

Baggage loss insurance may prove valuable if your luggage is damaged, lost or stolen while you’re on a trip. Items covered — and not covered — vary by travel insurance company. Baggage loss coverage only covers the depreciated value of your belongings, and policies may cap reimbursem*nt or exclude coverage for some items. This type of coverage is typically secondary, so you may have to file a claim with your airline or homeowners insurance first.

Baggage delay

Baggage delay coverage provides reimbursem*nt for necessities you must buy when your bag is delayed for an extended period of time. The waiting period varies across policies, but coverage usually kicks in if your bag is delayed at least 8 or 12 hours after landing. This type of coverage sets a daily limit for replacing essential items, such as toiletries or clothing.

When to consider buying a travel insurance policy

For some vacations, you don’t need travel insurance. At other times, it’s critical to have coverage, especially if you’re making a substantial upfront investment in your vacation.

“If you’re traveling domestically, especially if you’re taking a road trip, you probably don’t need travel insurance,” said Melanie Musson, a travel insurance expert with Clearsurance, an online insurance comparison platform.

More: Best Travel Insurance Companies

Megan Moncrief, chief marketing officer at Squaremouth, an online insurance site, recommends that trip-takers buy a policy in the following circ*mstances:

• You have prepaid a substantial amount for your trip and the costs are nonrefundable. A policy with trip cancellation can insure 100% of those expenses if you are unable to take the trip for a covered reason.
• If your health insurance policy does not extend coverage to your destination or imposes limits. A comprehensive travel policy will include medical benefits that can cover you in the event of an emergency.
• You have a concern that may lead you to cancel or delay your trip or return early, such as a sick or elderly family member, or you are traveling during the stormy season to a destination prone to hurricanes.
• The country you are traveling to requires travel insurance for all foreign travelers. A simple Google search will let you know if your target country requires travel insurance.

Of course, the chance of something going wrong probably isn’t very high.

“As is the case with all lines of insurance, odds are you won’t make a claim, so you’ll pay premiums with no reward,” Musson said. “But, if you do make a claim, you’ll undoubtedly be glad you decided to purchase the coverage.”

Tip: The more you invest in your adventure, the more important it is to purchase travel insurance.

When you may want to skip a travel insurance policy

You don’t always need travel insurance for your vacation. Moncrief cited common examples of when you can skip coverage:

• Trip cancellation coverage may be unnecessary if you’re not on the hook for nonrefundable expenses or if your credit card provides cancellation benefits as a perk.
• Emergency medical coverage is not always necessary if you are traveling domestically and your health insurance covers you while you’re away from home. It’s helpful to check with your health insurance provider to ensure your plan will cover you as you travel.

Also, review your airline’s travel cancellation policies to see what you might pay to change or cancel your flight. Rules vary by airline.

“For the most part, travelers should purchase insurance for their peace of mind,” said Naveen Dittakavi, founder and CEO at Next Vacay, an airfare search platform. “However, if you understand your rights as a passenger, it’s often not necessary to purchase expensive insurance, such as for trip cancellations.”

How to shop for travel insurance

Shopping for travel insurance can be quick and easy, provided you know what types of coverage you want. In some cases, you may be able to buy it at the time you purchase your airline tickets or book your vacation. However, it’s a good idea to review prices and plans offered by several travel insurance companies to find the most comprehensive plan for your needs.

Here are some things to consider as you shop for travel insurance.

Consider your destination. If you’re traveling internationally, a policy that includes medical coverage can be a good choice, as your health insurance policy may not cover you outside of the country. Also factor in locational or seasonal concerns, such as hurricane season or civil unrest.

Travel method. Some types of travel, like air or rail, are more prone to delays and cancellations than others. For instance, a flight itinerary may include multiple connections, putting you at greater risk for delays.

Your itinerary. Are you planning on prebooking a lot of tours or activities? Does your hotel allow late cancellations with full refunds? If your answer is yes to either, a trip cancellation policy will mitigate your risk of losing out on all those prepaid bookings.

Policy flexibility. A standard travel insurance policy will typically limit coverage to specific scenarios. If your flight is canceled because of an airline strike, you’ll be able to recoup your prepaid, nonrefundable expenses. If the weather forecast at your beach destination is rainy with no chance of sun, you won’t be able to recoup your losses if you decide to cancel last minute. If you want the flexibility to cancel for any reason, then consider buying “cancel for any reason” coverage.

Check your credit card coverage. If you book your trip using a credit card, it may already include trip cancellation or interruption coverage, while others may include support for baggage issues and even medical expenses. If you’re looking for basic coverage, it’s worth checking your credit card benefits. That said, you cannot personalize credit card travel insurance, so your card benefits may not offer exactly what you need.

Whatever you do, always compare policies and insurers. Sites such as Squaremouth and CoverTrip allow travelers to compare policies from a variety of travel insurance companies to find the best coverage at the most reasonable prices. Users can also see reviews from verified users, making it easy to weed out any questionable companies.

How to file a travel insurance claim

In the event that you need to file a claim, most insurers provide clear instructions on the steps required. Ensuring you follow the steps correctly can make the difference between a speedy or delayed resolution.

Once you review your policy and claim instructions, gather the required documentation. This typically includes receipts, medical bills, police reports and similar paperwork. All of this information should be uploaded to the insurer’s secure portal and you should receive a receipt and confirmation number.

Pay close attention to the claim filing window, as some insurers provide as few as 20 days after the event to file your claim. If you have any questions or would like an update on your claim, stay in touch with your insurer.

The bottom line

Travel insurance can help travelers save thousands of dollars in specific situations, but most of the time covered issues do not arise and you are paying for an unused service.

The key is to think strategically about the trip itself, health conditions and the chance that you will need to cancel or interrupt your trip to return home quickly.

If you’re traveling to the Bahamas during hurricane season, it’s likely not a bad idea to buy travel insurance. If you’re taking a domestic vacation during a normal weather season, you’re in reasonable health and a crisis won’t occur if your bag is a few hours late, you may decide to pass.

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