Is Travel Insurance Worth It? – Forbes Advisor

Considering travel insurance?

Find out how much it costs to protect your next trip

Travel insurance is a good idea if you want to protect the amount you spent on your vacation. But no one can blame you if you hesitate to add an extra expense to your travel budget after paying for airfare, hotel, meals, and activities. Still, if you can't afford to lose the non-refundable money you paid, travel insurance can be a wise investment.

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When is travel insurance worth it?

Buying travel insurance is usually worth it if:

• Your non-refundable travel expenses are far more than you can afford to lose.
• You are traveling internationally.
• You are traveling to a remote area where health care facilities are limited.
• You are traveling in a hurricane-prone area.
• Your trip involves connecting flights or multiple destinations.
• You want to be partially refunded if you decide to cancel your trip or return home early for any reason.

Overall, travel insurance is a small cost compared to the travel expenses you could lose, especially when uncertainties and surprises abound.

What does travel insurance cover?

Travel insurance compensates you for financial losses you incur due to unforeseen events before and during your trip. It can also cover emergency medical care and evacuation during your trip.

THE best travel insurance Policies include a range of coverage types related to trip cancellation, medical issues, baggage issues and more.

Summary: What Travel Insurance Covers

Where can you buy travel insurance?

You can buy travel insurance on travel insurance company websites, travel insurance comparison sites, and from travel insurance agents. Travel agents who sell travel insurance can also help you buy an insurance policy.

Some tour operators also sell travel insurance, but it's usually best to buy an insurance policy yourself, as you can customize it to your specific needs.

Buying travel insurance online is very convenient: you can usually get travel insurance quotes instantly by entering your information:

• Age
• Destination
• Cost of travel
• Travel dates

How much does travel insurance cost?

As a general rule, the cost of travel insurance represents 5 to 6% of the cost of your trip, according to Forbes Advisor analysis.

The average cost of travel insurance is $228 for a $5,000 trip, and the range of rates to insure a $5,000 trip is from $154 for a basic policy to $437 for a policy with generous coverage.

Your age, the coverage you purchase and the cost of your trip are key factors that affect how much you pay for an insurance policy.

What does travel insurance not cover?

Travel insurance does not cover losses due to reasons and circumstances within your control. It is designed to protect your travel investment if unforeseen circumstances derail your plans.

For example, trip cancellation benefits only apply if you cancel for a reason stated in the policy, which is unforeseen events beyond your control. This means that you won’t be able to make a standard trip cancellation insurance claim if you simply change your mind about your trip. For this, you’ll need ‘cancel for any reason’ cover.

Read the terms of the insurance policy carefully before you buy and familiarize yourself with what it does not cover. For example, travel medical insurance typically excludes expenses such as:

• Elective procedures
• Mental health care
• Participation in adventure or extreme activities
• Physiotherapy
• Routine physical and dental examinations
• Routine pregnancy

Also be aware that travel insurance policies typically don't cover money you lose due to a hurricane, unless you purchase travel insurance before the storm is named.

When is travel insurance not necessary?

Generally, you don't need travel insurance if you don't have large nonrefundable deposits or if your U.S. health insurance plan covers you at your destination.

Here are some scenarios where you may not need travel insurance.

• Business travel: If your company is organizing and funding your domestic business travel, you probably don’t need your own travel insurance. If your business trip takes you out of the country, you should check with your employer to see if your company has insurance that includes travel medical insurance that covers you. If not, you should consider purchasing your own travel medical insurance.
• A cheap domestic journey: If you can afford to lose your trip's nonrefundable deposits, you may not need travel insurance. Whether travel insurance is worth it may depend on the cost of a policy compared to your nonrefundable deposits.
• An inexpensive travel item: If you only have one or two inexpensive day trips or excursions planned, it may not be worthwhile to insure them. Consider what you stand to lose if they cancel. If you have many excursions and activities planned that are expensive, it may be worthwhile to insure them.
• Trips made with miles or points: While you can get great benefits from redeeming points and miles, travel insurance can't insure the value of trips booked using miles or points, says Jason Schreier, CEO of Aegisa travel insurance company. Keep in mind that if you interrupt your trip to return home in an emergency, you risk losing all those points and being exposed to last-minute flight costs.
• Trips where you are already covered: You may already have some Benefits of Travel Insurance Through a Credit Card or from an airline if you have opted for additional flight insurance. Check the details of any applicable cover you may have. It may be sufficient for your needs, in which case you will not need a separate travel insurance policy.
• Baggage insurance if you have home or renter's insurance: If you have owners or tenant insurance and you're not bringing a lot of valuables on your trip, you may want to consider forgoing baggage insurance. That's because lost baggage coverage is often secondary, meaning you'll need to file a claim with your airline or homeowners or renters insurance first before making a baggage claim for any remaining losses.

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