Travel insurance has become more mainstream than ever thanks to the relentless onslaught of COVID-19 on the travel industry. It is promoted by travel agents and planners and is featured prominently on the checkout page of hotel and airline websites.
But should you buy travel insurance? And what does travel insurance cover? The answer to both of these questions depends entirely on your trip. Personally, I’ve always been against it, but that doesn’t mean I take the financial risk if problems arise. In fact, I received thousands of dollars in compensation for what went wrong.
I’ll show you how I do it and whether you should consider buying travel insurance.
What does travel insurance cover?
There are various types of travel insurance to cover various travel purchases. Here are the most famous coatings:
- Baggage delay insurance. Reimburses you if your checked baggage is delayed. You will get money for things like toiletries and clothes if you need them.
- Trip cancellation insurance. Reimburses you for a prepaid non-refundable trip in case something goes wrong before you start your trip.
- Travel cancellation insurance. Covers prepaid expenses you didn’t use if something goes wrong during your trip.
- Emergency medical transportation. Pays to be taken to a special facility due to injury or illness during your trip.
- Travel delay insurance. Reimburses you if your trip is delayed by a certain amount of time (for example, your flight is canceled and you have to stay overnight). You will be covered for things like accommodation, toiletries, food, etc.
- Primary rental car insurance. Covers you up to the monetary value of most vehicles for theft or damage. it will not cover the car you crashed into or any injuries to people inside the car.
You can also purchase Cancellation for Any Reason (CFAR) insurance, which allows you to get most of your airfare as a refund (sometimes up to 90%) for a small fee. As the name suggests, you can cancel a trip simply because you change your mind.
Do I really need travel insurance?
You do not need travel insurance.
The fact is, even with a little confusion in the travel industry due to the remnants of coronavirus restrictions, you are unlikely to take advantage of this. However, if misfortune squeezes you into a vacation, you may have to save up thousands of dollars that would otherwise be covered by a nominal upfront fee. The peace of mind that travel insurance provides can be worth the money in itself.
A perfect example – during a trip to Ireland, insurance saved me twice:
- My registered bag never showed up in Dublin. Because I had baggage delay insurance, I received $500 to buy new clothes.
- I scraped a rental car in the garage. The rental agency charged $2,400 for repairs. But since I had the primary insurance for the rental car, I didn’t have to pay a dime.
These things usually don’t happen. But there are a few key insurances that I always check just in case.
Wait. Didn’t I say earlier that I never buy travel insurance?
Well, I get my insurance for free when I book flights and car rentals with the Chase Sapphire Preferred® card. But if you don’t have a credit card that includes insurance, you can also buy a policy that includes these things for about $100 or more — along with other helpful covers you won’t find on the card, like COVID-19 cancellation. .
Again, cancellation insurance for any reason (CFAR) is especially useful these days after all the recent chaos that has been inflicted on the travel industry.
Where to get travel insurance
If you’re looking to buy insurance, there are plenty of reliable providers out there. Sites like Seven Corners, John Hancock, and Tin Leg offer plenty of options so you can easily customize your insurance just the way you want it.
Here are some price ranges:
If you’re traveling overseas and are afraid the coronavirus will interfere with your plans, you can tailor the $65 Seven Corners policy, which provides benefits such as:
- Trip cancellation and interruption coverage
- Medical coverage for COVID-19
- Medical Quarantine Cover
- No medical deduction
If you’re traveling to Miami during hurricane season and planning to rent a car, you can make a plan from John Hancock for $106 that covers:
- Trip cancellation and interruption
- Hurricane and weather insurance that covers flight delays of up to 48 hours and reimburses you if you have to leave your home due to the weather.
- CFAR insurance that gives you the option to simply change your mind if you don’t want to deal with the unknown and get 75% of your money back
- Rental car insurance up to $50,000 in case inclement weather, such as flooding, damages the car.
If you’re going on a cruise, the $38 Tin Leg insurance policy can give you all of the suggested coverage for that activity, such as:
- Hurricane and weather insurance
- Medical coverage for COVID-19
- Medical evacuation and repatriation up to $250,000
- Trip delay (effective after six hours)
- Loss of luggage and personal belongings up to $500
But more often than not, you’re probably tempted to buy insurance on the checkout page of an airline’s website. Here you will find insurance that offers things like trip cancellation insurance, baggage loss insurance, and health insurance. You will also get a healthy dose of alarmism and panic.
Below is a fictitious booking with United Airlines for price verification purposes only. For a flight to Venice for $1,039, you will be offered a $75.35 insurance policy.
Source: United.com, screenshot by Sarah Hostetler.
You can get a very similar policy through Tin Leg for $52. However, you can find convenience just by checking the box, which costs an extra $23.
It’s also extremely important to remember that, as I mentioned earlier, some travel credit cards come with built-in travel insurance. As long as you pay for your trip with one of these cards, you get automatic coverage.
What I am doing.
Read more: The best credit cards for travel
Credit cards with travel insurance
Travel credit cards offer different levels of insurance payouts. But if you want the best of the best, here are a few options you should consider.
| Capital One Venture X | Chase Sapphire Preferred® Card | Chase Sapphire Reserve® | |
|---|---|---|---|
| Annual fee | $395 | $95 | $550 |
| Trip cancellation and interruption insurance | Up to $2,000 per person | Up to $10,000 per person and $20,000 per ride | Up to $10,000 per person and $20,000 per ride |
| Trip delay insurance | Up to $500 | Up to $500 | Up to $500 |
| Lost baggage reimbursement | Up to $3,000 per person | Up to $3,000 per person | Up to $3,000 per person |
| Baggage delay insurance | N/A | $100 per day for up to five days | $100 per day for up to five days |
| Travel accident insurance | Up to 1,000,000 USD | Up to $500,000 | Up to 1,000,000 USD |
| emergency evacuation | N/A | N/A | Up to $100,000 |
| Primary rental car insurance | Up to $75,000 | Up to the actual cash value of the rental car | Up to $75,000 |
| Help on the road | N/A | Pay Per Use | Up to $50 per event, maximum four events per year. |
| Travel and emergency assistance | Yes | Yes | Yes |
| learn more | Read our full review | Read our full review | Read our full review |
Bottom line: is travel insurance worth it?
I would not like to discourage you from doing whatever is necessary to achieve peace of mind during your travels. However, in the vast majority of cases, buying travel insurance is not required if you have even a basic travel credit card.
For Best travel insurance available by credit card, consider something like Chase Sapphire Reserve® or a Capital One Venture X credit card. Annual fees are higher than usual, but if you would otherwise purchase things like rental car insurance and cancellation insurance trips, the annual fees are worth it.
Featured Image: Elnur/Shutterstock.com