Travel Insurance: Is It Worth the Cost?
Written by
Joel Lim
Edited by
Jenna Klaverweiden
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So you’re rushing off for a weekend getaway or planning two weeks in Europe, and someone told you that you should spend some money on travel insurance.
Now you’re wondering whether it’s worth the expense. You’re likely also hoping nothing goes wrong so you don’t even have to worry about it. Well, there are many factors to consider when deciding whether travel insurance is worth the cost.
What Is Travel Insurance?
Travel insurance is a policy you purchase that will cover unexpected costs during your trip.
Because anything can happen in life, and on vacation, travel insurance is a backup for emergencies. These could range from delayed flights and natural disasters to minor illnesses, lost luggage and more. And you can find policies to cover one or two situations, or all potential hazards.
The Pros of Travel Insurance
There are many benefits to choosing travel insurance for your next trip. Here are a few to consider.
Trip Cancellations and Interruptions
One of the primary reasons travelers purchase insurance is to cover nonrefundable tickets and reservations. If you get a great deal on a flight, hotel or event, you don’t want to lose potentially thousands of dollars due to unforeseen circumstances.
Even if your reservations are refundable, you might still face a cancellation penalty. Some travel insurance will reimburse your expenses if you have to cancel due to covered reasons, like illness, injury or family emergency.
Emergency Medical Coverage Abroad
No one wants to get sick on vacation. But it happens. And sadly, some U.S. health insurance plans won’t cover you out of the country.
If yours does, great. If not, you can purchase travel insurance that includes emergency medical benefits. That way, if you get sick or injured while traveling, you won’t have to worry about being turned away. Maybe even worse, you won’t end up with thousands in medical debt on top of your vacation expenses.
Evacuation and Repatriation
You never know what kind of emergency situation you might find yourself in during your travels. For example, sudden hurricanes could completely disrupt your vacation.
Travel insurance can include coverage that will help you get out of a dangerous situation and back to your home country. Without insurance, you could end up paying tens of thousands of dollars and struggling to find someone to help get you home.
Lost, Delayed or Stolen Luggage
Few things spoil a vacation more quickly than arriving at your destination only to find your luggage hasn’t arrived with you. And it may not arrive anytime soon.
The right policy will cover the cost of replacing your essential items, like clothes and toiletries. You can even find a policy that will reimburse you for items you buy while waiting for your delayed bags.
Peace of Mind
Finally, even if you never use it, it can be nice to have insurance “just in case.” It can help you relax more, stress less and have a better overall experience just knowing you’ve got backup.
That way, you can enjoy your trip and not spend all your time asking those what ifs.
The Cons of Travel Insurance
That being said, there are some cons of travel insurance to consider before jumping in.
Redundancy With Existing Coverage
The main reason you might not want to buy a travel insurance policy is that you already have it. Some credit cards have travel insurance tacked on that will cover delayed trips, baggage protection and rental car coverage.
Or you might have travel insurance through work if you’re headed on a business trip. There’s no reason to buy more insurance if you’re already covered.
Added Cost to Your Trip
Of course, one of the main downsides to travel insurance is that it means more expenses. You’re already spending on flights, hotels, food and events. Now you have to add travel insurance? It can add a substantial amount of money to an already pricey trip.
You could use that money for so many other cool things. For those on a budget, or if you’re taking a short domestic trip, the expense may be unjustified.
Exclusions and Fine Print
You may purchase a policy only to find that certain situations are not covered. Some policies won’t cover preexisting medical conditions or high-risk activities, for example.
You might also not have coverage for certain weather-related disruptions. If you don’t read the fine print (and there can be a lot of it), you may think you’re covered only to find out you’re not.
Complex Claims Process
Filing a claim for your insurance isn’t always easy. In fact, it can be quite a pain to have to sit on the phone, provide proof of events and compile all the documents you need, like doctors’ notes and police reports.
And even when you have all of your evidence in order, your claim might be denied. For many people, it may feel like too much of a headache to worry about it.
Is It Worth the Cost? It Depends
So is it worth the cost? The answer, as with most of these situations, is that it depends. You have to evaluate the value of your trip, your risk tolerance and how much unpredictability you expect for this trip.
If you’re traveling internationally or will be engaged in high-risk activities in a high-risk area, you likely want to ensure you have full coverage. (But make sure to read the fine print and double-check your coverage with your agent.)
In contrast, if you feel like you can afford to lose money you’ve prepaid, or you realize you’re already covered, you can probably do without it.
Finally, if you just want added coverage for peace of mind, a policy might be worth the price just for that.
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