Travel insurance is a smart purchase when planning to travel. It can protect against financial losses like lost or delayed luggage and trip cancellations.
Most insurers include a Free Look period within which you can cancel your policy and get a refund as long as you haven’t started travelling. Read the policy, certificate or description of coverage carefully to ensure you’re getting what you need.
What is Travel Insurance?
Travel insurance, also known as travelers insurance, protects against financial losses due to events that may affect your trip. Plans can cover cancellations, loss of personal belongings, medical expenses and more.
Most comprehensive travel insurance plans offer trip cancellation, interruption, lost luggage, overseas medical and dental, emergency evacuation and 24-hour traveler assistance coverage. They usually cost between 4-8% of your total trip costs.
Standalone travel medical policies are designed to fill in gaps in your primary health insurance while traveling abroad and typically cost less than comprehensive plans. Some plans also include accidental death and dismemberment coverage, which pays out a lump sum to your beneficiary if you are killed or seriously injured while traveling. Some airlines and tour operators require that travelers have this coverage.
What Type of Coverage Do I Need?
Most travel insurance plans offer reimbursement for canceled or interrupted trips as well as lost luggage, overseas medical and dental coverage, emergency evacuations and 24-hour traveler assistance. Some also include accidental death benefits.
Look for policy limitations, exclusions and fine print. Your homeowners or renters insurance may cover your possessions while you’re traveling, so check with your insurer before purchasing a separate policy.
Comprehensive policies typically cost 4-8% of your trip price and cover delays, cancellations due to illness or death, lost baggage and some medical expenses. You can also purchase stand-alone medical and evacuation insurance, or add it to your comprehensive plan.
These plans are especially important for travelers to remote destinations where their health insurance might not provide full coverage and Medicare does not cover medical bills outside the U.S.
How Much Coverage Do I Need?
In addition to comparing policies and prices on travel insurance comparison sites like Squaremouth, consider whether your credit card might offer extra protections, such as trip cancellation coverage (though note that this is not the same as travel insurance).
Many tour operators, cruise companies, and hotel chains sell their own insurance packages, as do some online travel agencies.
Ultimately, the type of coverage you need depends on the level of risk you’re willing to take. A policy can add 3% to 5% of the cost of your trip, but for some travelers, that’s a small price to pay for peace of mind.
For example, you’ll want to ensure your policy covers coronavirus-related medical expenses since most health insurance plans and Medicare don’t provide coverage overseas.
How Do I Get Coverage?
As you plan your trip, consider whether travel insurance is right for you. Many travel agents recommend it (because they get a commission on every sale), but ask questions and always read the fine print to make sure you understand your coverage options.
Some policies offer upfront payments for medical expenses, while others are reimbursement-only. You should also check with your home insurer about personal property coverage while traveling, as some homeowners insurance policies will cover your possessions and may be less expensive than a separate policy.
Some credit cards automatically include a travel protection policy with every booking. And some tour companies, cruise lines and airlines sell policies in conjunction with their trips. You can also buy standalone travel insurance from most insurance providers and compare plans on websites such as Squaremouth.
How Can I Get Coverage?
Most travel insurance providers offer a range of add-ons or riders for their plans to increase benefit limits and cover activities that are excluded from basic policies. For example, some policies include adventure sports coverage for things like skydiving and bungee jumping. Others offer identity theft protection, which will help you notify creditors and cancel credit cards if your information is stolen.
Some companies offer 24/7 multilingual customer service in most (or all) of the countries where their customers will be traveling, which can be helpful if you have a medical or logistical issue while away from home. In addition, some insurers have emergency assistance centers that can make arrangements for you to get care in a foreign country or coordinate evacuations.
Be sure to read a policy’s fine print and ask questions before you buy. You can purchase a policy online, which can be less stressful than dealing with travel agents.
