If you are going on a vacation or an extended business trip, then you've probably bought some new things to take with you. But you may also want to consider buying travel insurance.
Although many travelers are unaware of its existence, today you can buy insurance to cover the cost of many of the things that can go wrong before or during a trip. Offered through travel agents, tour operators, and insurance agents, policies are sold either for a flat, per vacation price, or on a per-day-of-travel basis.
Some policies allow you to purchase coverage against specific risks, while others package together coverage against the cost of a number of exposures that can occur on or before a trip or vacation.
The risks that can be insured against include:
This coverage insures you against the loss of your deposit or prepaid expenses in the event your trip or vacation is canceled or interrupted due to illness or injury, or due to the default or bankruptcy of a company with which you're scheduled to travel. In addition, depending on the policy, coverage may apply to a number of other reasons for your trip's cancellation or interruption, including:
This coverage insures you against the loss of your deposit or prepaid expenses in the event your vacation is delayed (generally, for 12 hours or more) due to a number of causes, including:
Airlines only cover baggage while it's in their possession, and most cruise lines, tour operators, and hotels offer little or no coverage. Baggage travel insurance covers your belongings that are lost, stolen, or damaged at anytime throughout your trip.
This insurance generally covers 2 expenses:
This coverage pays a benefit in the event of the death or dismemberment of an insured while traveling or on vacation.
Covers the cost of arranging for having an insured's remains returned home in the event of their death while traveling.
Some travel insurance package policies also offer you a number of services while traveling. These include:
A travel insurance policy is a contract, and as with all contracts, you should always read the fine print. In particular, when reading the policy, be aware of the following:
Take a look at your homeowner's insurance. It might cover your belongings while you're traveling, and you may already have adequate life insurance coverage. On the other hand, don't assume the insurance that you have, especially your health insurance, will cover you for expenses incurred while traveling, especially if you'll be traveling abroad. Most policies specifically state that they don't pay for costs already paid by another policy you hold.
If you've bought a family vacation package, then ask if each member of your family needs to be specifically named in the travel insurance policy. Also, ask if you are covered if you take a side trip during a vacation tour. These are some situations you should ask about when assessing your policy. Moreover, if you're traveling abroad to an area or country undergoing unrest, see if the policy excludes hijacking or terrorism related injuries, or completely excludes all coverage when you're traveling in that specific area or country.
See if your policy excludes payment, as many do, on claims for trip cancellation, trip interruption, or travel medical insurance, if your claim arises from a pre-existing medical condition. If it does, check to see if it offers the option of waiving this clause for a small additional premium.
Again, as noted, most won't cover you while you're traveling abroad, but some will. However, virtually none cover medical evacuation costs when you're abroad. If you do buy this travel coverage, be certain it covers the cost of transporting you, or a family member traveling with you, home if medically necessary, not just the cost of transporting you to a local hospital or medical center.
Trip cancellation/interruption coverage, for example, that is underwritten by the cruise line you're traveling on won't be much help if the cruise line itself goes bankrupt. If you have specific questions about the travel insurance you're considering purchasing, its best to call and direct these questions to the insurance company underwriting the policy.
Okay, now that you know what travel insurance can include, the obvious question is whether you should buy it. For most people, the answer is yes. As noted, many other insurance policies you currently have may not cover you when you're traveling. And, even if it does, in many cases the trip cancellation/interruption coverage itself is worth the cost of travel insurance. This is especially true given the fact that travel insurance has become, relatively speaking, very inexpensive.
American Society of Travel Agents
U.S. Travel Association
Association of Canadian Travel Agencies
FAQs. US Travel Insurance Association website. Available at: http://www.ustia.org/faqs.html. Accessed July 31, 2017.
The beginner's guide to travel insurance. Travel Insurance Review website. Available at: http://www.travelinsurancereview.net/beginners-guide. Accessed July 31, 2017.
Travel insurance. TravelASSIST Magazine. Available at: http://www.travelassist.com/mag/a64.html. Accessed July 31, 2017.
Travel insurance: What you need to know before you buy. Frommer's website. Available at: http://www.frommers.com/tips/health-and-travel-insurance/travel-insurance-what-you-need-to-know-before-you-buy. Accessed July 31, 2017.
Types of travel insurance. Travel Insurance Review website. Available at: http://www.travelinsurancereview.net/plans. Accessed July 31, 2017.
Last reviewed July 2017 by Michael Woods, MD, FAAP Last Updated: 8/5/2015