Travel insurance is boring until you need it—then it's the best purchase you ever made. Here's what actually matters when choosing coverage.
What Travel Insurance Actually Covers
Trip Cancellation/Interruption
Reimburses pre-paid, non-refundable trip costs if you need to cancel for covered reasons:
- Illness or injury (yours or family member's)
- Death in immediate family
- Jury duty, job loss (sometimes)
- Travel provider bankruptcy
Key limitation: "Cancel for any reason" (CFAR) coverage costs more but offers flexibility for non-covered reasons.
Medical Coverage
Covers treatment costs if you get sick or injured abroad. Critical because:
- Your domestic health insurance often doesn't work abroad
- Medical costs in some countries are astronomical
- Medical evacuation can cost $50,000+
Recommended minimum: $100,000 medical, $250,000 evacuation
Baggage Coverage
Reimburses lost, stolen, or damaged bags. Often less useful than it seems:
- Per-item limits are often low ($250-500)
- Electronics may be excluded or limited
- Airlines have their own liability requirements
Travel Delay
Covers expenses if your travel is delayed beyond a threshold (usually 6-12 hours):
- Hotel, meals, and essential purchases
- Typically $150-200/day limit
What Travel Insurance Doesn't Cover
- Pre-existing conditions: Unless you buy a waiver
- "Just changed my mind": Basic policies don't cover this
- Extreme sports: Often excluded or require add-on
- War zones and high-risk areas: Check exclusions
- Epidemic/pandemic: Often excluded or limited
- Intoxication-related incidents: Don't expect coverage if you were drunk
Credit Card Travel Coverage
Many travel credit cards include benefits, but understand limitations:
- Trip cancellation coverage is often minimal ($1,500-3,000)
- Medical coverage may be secondary to your primary insurance
- Must have booked travel on that card to qualify
- Rental car coverage varies by card and country
Credit card coverage can supplement but rarely replaces comprehensive travel insurance for major trips.
When You Really Need Insurance
- Expensive pre-paid trips (the more you've invested, the more you need protection)
- Adventure travel with injury risk
- Traveling to countries with expensive healthcare
- Extended trips where something going wrong is more likely
- Traveling with pre-existing conditions
When You Might Skip It
- Short, domestic trips with refundable bookings
- Very low-cost trips where insurance costs a high percentage of trip cost
- When credit card coverage adequately covers your specific risks
Choosing a Policy
Compare using aggregators like InsureMyTrip or Squaremouth:
- Define your coverage needs first
- Read the actual policy, not just marketing
- Check reviews for claims-paying reputation
- Consider annual policies if you travel frequently
Filing Claims
If something goes wrong:
- Document everything (photos, police reports, medical records)
- Keep all receipts
- Report incidents promptly as required
- Follow the claims process exactly