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You may be ready to experience the nightlife in Las Vegas, lounge on the beaches in Fort Lauderdale or explore the famous San Antonio River Walk. You may even be booking a trip abroad to tour Italy or bask in the sun in Greece.
A comprehensive travel insurance policy can package together a number of great coverage types for trip cancellation, medical expenses, baggage and more. But how do you know if your trip is worth insuring?
Do You Need Travel Insurance for a U.S. Trip?
If you’re traveling within the U.S. or its territories, and you have pre-paid significant non-refundable deposits for the trip, you should consider purchasing at least trip cancellation insurance, says Don Van Scyoc, a spokesperson for GeoBlue, a travel insurance company.
For example, if you have booked non-refundable plane tickets, an expensive resort and private excursions such as snorkeling, you may want insurance. Trip cancellation insurance will reimburse you 100% for what you lose in deposits if you have to cancel the trip for a reason listed in the policy. These reasons generally include:
- Sickness of you or a family member
- Injury or death
- A job lay-off
- Jury duty
- Military deployment
- Strikes by travel workers
- Severe weather
- Terrorist incident at your destination
- And other reasons
There are some trips where travel insurance isn’t worth the cost. For example, if you’re driving to attend a college reunion in Philadelphia for a long weekend and have a refundable hotel room, you don’t need travel insurance because you aren’t facing a financial loss if you don’t go.
Even if some parts of your trip are non-refundable, if the potential loss is low, like a one-night hotel penalty, you’ll likely decide to skip travel insurance.
Do You Need Travel Insurance for an International Trip?
Travel insurance deserves serious consideration for international travel, even if trip cancellation insurance isn’t important to you.
Travel medical insurance is important for medical coverage outside of the U.S. Your domestic medical insurance provider will likely not cover you for medical care outside the U.S., or provide only limited coverage and/or a high deductible.
And because Medicare doesn’t cover health care outside the U.S., travel medical insurance is crucial for senior travelers.
“International travel medical insurance covers unexpected medical expenses and emergencies abroad,” says Jeremy Murchland, president of Seven Corners, a travel insurance company.
If you’re vacationing in France, for example, and twist your ankle in Paris on a cobblestone walkway, you will need medical attention. Your travel insurance plan can cover medical costs for doctor visits, medicine and transport to a local hospital.
Emergency medical evacuation coverage is another important benefit available with travel insurance, particularly if you are outside the U.S. If you suffer a serious injury or illness and need to be transported by medevac to a better medical facility, your travel insurance plan can cover this cost. Without this coverage, you could be on the hook for thousands of dollars for medevac transportation.
Top Coverage Types to Choose
Trip cancellation and interruption coverage
Murchland says coverage for trip cancellation and interruption is popular.
“There are many unknowns that come with traveling, especially in today’s market, so having these options can grant peace of mind,” he says. With trip cancellation and interruption coverage, you can cancel or cut short the trip for reasons covered by the plan. (Read the list of acceptable reasons before you buy the plan.)
Fear of travel or changing your mind is not a valid covered reason under standard trip cancellation insurance. To provide the most cancellation flexibility for your trip, many insurers offer an add-on called “cancel for any reason” (CFAR) coverage. This addition expands the reasons for canceling a trip and getting reimbursement—you could cancel simply because you don’t feel like going anymore.
Murchland says this popular upgrade allows changes in travel due to fear, personal emergencies and anything else that may be outside the list of covered reasons. This flexibility can cost 40% more than a standard policy.
You generally must cancel at least 48 hours before your scheduled departure in order to make a CFAR claim, and you can usually recoup 50% or 75% of the trip’s cost. (Standard trip cancellation insurance in the base policy provides 100% reimbursement.)
Other travel insurance coverage types can prove useful but likely aren’t the sole reason to insure a trip:
Baggage loss and delay coverage reimburses you for damaged or lost luggage and also personal belongings. For instance, if you get to Turks and Caicos but your bags don’t, you can get reimbursement for the swimsuits and sandals you need until your luggage shows up.