Travel Insurance

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How to Find the Best Travel Insurance

There’s nothing like travel to renew the spirit. A change of scene gives a fresh perspective, a chance to let go and maybe even a taste of adventure. Travel insurance provides a safety net so you can step out with confidence.

Depending on the policy, travel insurance reimburses you or offers services when something goes awry:

  • You make nonrefundable reservations and then have to cancel or end a trip early because you get sick or there’s a death in the family.
  • Your baggage is lost or stolen.
  • You miss a flight or have an emergency and need help finding a hotel, doctor or legal help.
  • You get sick while traveling and need medical care.
  • You have a medical emergency and need to be transported to the nearest hospital or back home.

There’s even coverage for the worst-case scenario: if you die in an accident while traveling. Accidental death coverage pays your beneficiary a lump sum in that case.

Before you buy, take a little time to get familiar with how travel insurance works, how it’s priced and what it covers and excludes.

Who needs travel insurance

Insurance is designed to cover the big financial risks you don’t want to bear alone. You don’t need travel insurance for inexpensive trips, but it can provide a sense of security when you prepay pricey reservations or plan a big trip abroad.

Types of travel insurance

You’ll find a wide selection of travel insurance plans when you shop for a policy. Generally, travel insurance is sold as a package, known as a comprehensive plan, which includes a variety of coverage. Some insurers and comparison sites let you customize a policy by choosing types of coverage a la carte. Here are the most common offerings:

TRIP CANCELLATION, INTERRUPTION AND DELAY

Trip cancellation insurance reimburses you for prepaid, nonrefundable expenses if the tour operator or cruise line goes out of business or you have to cancel the trip for one of the reasons outlined in the policy, such as your own illness, the illness or death of a family member who’s not traveling with you, bad weather or natural disasters.

Trip interruption insurance covers the nonrefundable cost of the unused portion of the trip if you have to interrupt a vacation because of a reason outlined in the policy. Trip delay coverage reimburses you for expenses such as hotel accommodations and meals if you’re delayed during a trip, such as if your flight gets canceled because of bad weather.

BAGGAGE AND PERSONAL BELONGINGS

This coverage reimburses you for baggage and personal belongings that are lost, stolen or damaged during the trip. Some plans also reimburse you for extra expenses if your baggage is delayed for more than a certain period, such as 12 hours.

EMERGENCY MEDICAL ASSISTANCE, EVACUATION AND REPATRIATION

This coverage pays medical expenses if you get sick or injured on a trip. Medical evacuation coverage pays for transporting you to the nearest hospital, and medical repatriation pays for flying you home.

MAJOR MEDICAL INSURANCE

These plans are for people traveling abroad for several months or more and provide comprehensive health insurance while away from home. In some ways they work like traditional health plans. However, they’re not subject to the Affordable Care Act, so they include limits on coverage and exclusions for pre-existing conditions.

24-HOUR ASSISTANCE

This service is included with many package plans. The insurer provides a 24-hour hotline that you can call when you need help, such as booking a flight after a missed connection, finding lost luggage, or locating a doctor or lawyer. Many services also offer information before the trip, such as required vaccinations.

RENTAL CAR COVERAGE

This pays for repairing your rental car if it’s damaged in a wreck, by vandals or in a natural disaster.

ACCIDENTAL DEATH AND DISMEMBERMENT INSURANCE

The coverage pays a lump sum to your beneficiary, such as a family member, if you die in an accident while on the trip. Accidental death and dismemberment insurance policies also pay a portion of the sum to you if you lose a hand, foot, limb, eyesight, speech or hearing. Some plans apply only to accidental death in a plane.

COMMON TRAVEL INSURANCE NEEDS

If you want:Include this in your travel insurance policy:
Payment of medical expenses if you get sick or injured on a trip and need emergency care that’s not covered by your regular health insurance planTravel medical plan
To be taken to the nearest adequate hospital or flown home if necessary if you’re injured or get sick on a tripEmergency evacuation and repatriation
Reimbursement of nonrefundable reservations if you get sick and have to cancel or end a trip earlyTrip cancellation and trip interruption
Reimbursement of nonrefundable reservations no matter why you cancel a trip“Cancel for any reason” coverage
Payment for lost, stolen or damaged baggageBaggage and personal belongings
Help finding a lawyer abroad24-hour assistance
Payment for rental car damageCar rental collision insurance

Travel insurance cost

A comprehensive travel insurance plan typically will cost about 4% to 8% of the cost of a trip, according to the U.S. Travel Insurance Association. The price will vary depending on:

  • Length and cost of the trip: The longer and more expensive the trip, the higher the policy cost.
  • Destination: High health-care costs in your destination can drive up the price of travel insurance.
  • Medical conditions you want covered: Coverage for conditions you already have will increase the cost of travel insurance.
  • Amount and breadth of coverage: The more risks a policy covers, the more it will cost.
  • Your age: Generally the older you are, the higher the price.

How to get travel insurance

MethodProsCons
Credit card: Some credit cards offer trip cancellation and rental car insurance if you use the card to book the trip or the car. (Most credit cards offer secondary car rental insurance, which means it pays for car damage not covered by your regular car insurance plan.)
  • The coverage is free.
  • You can’t customize the insurance to meet your needs.
  • Most credit cards offer secondary car rental insurance, which means it pays for the costs not covered by your regular car insurance plan.
Travel agent and travel reservation sites: You can buy travel insurance when you book your flight, hotel and car rental.
  • Buying is as quick and easy as clicking “yes” when you book reservations.
  • The coverage is inexpensive.
  • You can’t customize the coverage.
Travel insurance company: You can buy directly from many companies on their websites.
  • You can choose a policy that fits your needs.
  • Many travel insurer websites also offer information to help you understand the coverage.
  • You’ll need to go to multiple websites to compare coverage and prices.
Travel insurance comparison sites
  • You can choose a policy that fits your needs and compare policies and prices in one place.

Where to get travel insurance quotes online

Comparing policies from different travel insurers is your best bet for getting insurance customized to your needs and at the best price. Here are websites where you can get travel insurance quotes.

SHORT-TERM TRAVEL INSURANCE

World Nomads

World Nomads specializes in short-term travel coverage, including theft, and are very popular among travelers. Nomads for your next vacation is quick & easy. You can even purchase a plan with little advanced notice. You can extend coverage online from anywhere too.

Health Coverage Worldwide: Yes.
Coverage At Home: No.
Medical Evacuation: Yes.
Trip Cancelation: Yes.
Theft/Damage Insurance: Yes. ($500 per-item limit)

LONG-TERM TRAVEL INSURANCE

IMG Global

This plan specializes in long-term worldwide medical coverage, but does not cover theft or trip cancelation. Coverage inside the United States is included, but to qualify you must spend at least 6 months of the year living abroad. You can choose a deductible from $250-$10,000.

Health Coverage Worldwide: Yes.
Coverage at Home: Yes.
Medical Evacuation: Yes.
Trip Cancelation: No.
Theft/Damage Insurance: No.
Example Quote: Global Gold (1 year policy) = $74/month with $1000 deductible

MORE INSURANCE OPTIONS

Travel Insurance Comparison Sites

Comprehensive Travel Insurance Plan Providers

Medical Travel Insurance

4 tips for buying travel insurance

  1. Consider the financial risks you face when traveling. Can you bear those costs yourself, or do you want insurance?
  2. Examine what coverage you already have: Does your credit card offer travel insurance? Do you have renters or home insurance to cover belongings? What is the deductible? Will your health plan cover you in all the locations where you travel?
  3. Get quotes for travel insurance online. Choose a package of the benefits you need and compare prices for similar coverage among carriers.
  4. Narrow your choices and then read the policy details to understand what’s covered, what’s excluded and the limits on coverage. You may find that the lowest-priced policy is too restrictive and that paying a little more gets you the coverage you need. Or you might find that the cheapest, most basic policy fits the bill.

Unpredictability is one of the mind-opening joys of travel, but travel insurance should contain no surprises. The time you spend to understand your options will be well worth the security you have as you embark on your next adventure.

And don’t forget the awesome list of Travel Resources to save you a fortune.