Booking travel always carries some degree of uncertainty. Travel insurance provides a safety net so you can step out with confidence. It’s designed to cover the major financial risks you don’t want to bear alone. You may not need travel insurance for short or inexpensive trips, but it can be invaluable for prepaid, high-cost reservations or big international journeys.
What Does Travel Insurance Cover?
Depending on the policy you choose, travel insurance can cover a broad range of risks:
Trip Cancellation/Interruption:
Trip cancellation coverage reimburses non-refundable expenses, including penalties, when you must cancel for a covered reason. Common examples include illness (yours or a travel companion’s), a family emergency, or even the bankruptcy of a tour operator or airline.
Trip interruption coverage applies if you need to cut your trip short. For instance, if you become sick or injured and cannot complete your stay, you can be reimbursed for unused expenses.
Emergency Medical Assistance
Travel insurance often covers medical expenses abroad that your regular health insurance does not. Many U.S. health insurance plans provide limited or no coverage overseas, including Medicare. Travel insurance supplements your existing plan, helping to cover emergency care, evacuations, and other medical costs while traveling.
Some plans may also offer coverage for pre-existing conditions, long-term trips, or multi-trip protection. For international travelers, this is one of the most essential benefits of travel insurance.
Baggage and Personal Belongings
Most policies cover delayed, lost, damaged, or stolen luggage. While airlines may provide some protection, their coverage limits are typically low. Travel insurance can also reimburse extra expenses when baggage is delayed beyond a set period, such as 12 hours. This is particularly important if you’re traveling with valuable or hard-to-replace items.
Accidental Death
If a covered traveler passes away during a trip, accidental death and dismemberment coverage provides a benefit to designated beneficiaries. This is often intended for immediate family members and usually supplements any existing life insurance.
Does Travel Insurance Cover the Coronavirus?
COVID-19 was declared a pandemic on March 11, 2020, which affected how insurers handled coverage for related claims. Coverage depends heavily on policy language and purchase dates, but overall, U.S. consumers now have more options for COVID-related protections than they did before.
Like other “known events” (such as hurricanes), once an event has been declared, travelers who purchase insurance afterward may not be covered for cancellations related to it.
“It is worth the effort to be educated and well-informed about policies now,” noted Brian O’Connell, analyst at InsuranceQuotes. “Read the language and ask a lot of questions. I think people are becoming better insurance consumers in the last 12 months.”
What is Cancel for Any Reason (CFAR) Travel Insurance?
CFAR policies allow you to cancel a trip for virtually any reason and receive partial reimbursement for non-refundable expenses. Typically, CFAR costs 25–50% more than traditional travel insurance and must be purchased at or near the time of booking. Purchasing CFAR after finalizing a trip usually excludes coverage for that trip.
Tips for Purchasing Travel Insurance
Many travelers assume that travel insurance always comes as a bundled package covering every potential risk. While package plans are the most common, they can also be the most expensive. By evaluating your specific needs, you can avoid paying for coverage you don’t require.
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Package Plans: Best for expensive, once-in-a-lifetime trips. They cover a wide range of risks including cancellations, medical emergencies, lost baggage, and evacuations.
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Travel Medical Plans: Designed to cover emergency medical care outside your regular health insurance network. This is especially important if your domestic policy excludes or limits coverage abroad.
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Specialty Plans: These add targeted protection for specific risks, such as rental cars or supplemental life insurance. Ideal if you’re only concerned about one or two aspects of your trip.
Many travelers skip travel insurance because they assume it isn’t necessary. But when things go wrong, the peace of mind that comes with knowing you’re covered is often worth the small additional cost. Spending a little more up front can help safeguard your trip, your budget, and your memories. Safe travels!
Corey Elsasser
