Exploring and discovering unknown places is the essence of travel, then be it a 2-day vacation or a year-long backpacking trip, you will come across countless new experiences, some good and some bad. As you are ready to soak in the good ones, it is crucial to be ready for the bad ones as well. Travel insurance is the safety net you can turn to if things get sidetracked.
Here’s everything you need to know about Travel Insurance to get maximum benefits from your policy.
Do You Need Travel Insurance?
The only answer is YES, you need travel insurance. Having travel insurance protects your possessions, your health, and you. It enables you to travel more freely and with more peace of mind. There are only so many emergencies you can prepare for, having travel insurance will protect you against all those unforeseen events. Here’s why everyone needs travel insurance:
Emergency medical backup
Travel insurance gives a solid backup for medical emergencies during your trip. In case of any urgent medical assistance, accidents, or injury, your travel insurance will provide you coverage and lower the expense substantially.
Protection against theft/lost luggage
Be it your important documents like your passport or your work gear like your laptop, travel insurance will help you replace these items without additional costs in case of theft or loss of luggage at the airport.
Coverage for cancelations
Travel insurance will cover the cost of your canceled flight or the connecting flight that you might miss because of delays because of bad weather, technical failure, etc. Also, if you get sick or can’t travel on the decided date, you’ll be able to cancel or postpone your journey and get reimbursed for flights and accommodation costs.
The Basic Types of Travel Insurance
Travel insurance is an anchor that will protect you in case of emergencies. It is not always an all-inclusive policy that will cover everything. Even general travel insurance is more specific than you think. Knowing the basic types of travel insurance will help you make an informed choice. Here is what you need to know:
Trip Cancelation/Interruption Insurance
Trip Cancellation/Interruption Insurance covers the cancelation of trips due to unforeseen events.
This coverage is generally meant for illness, injury, or death suffered by the insured or a member of the insured’s immediate family. Most policies do not cover trip cancelation in the event of war, civil disturbance, countries prone to political unrest, or a change in your financial circumstances. Some tour operators include this coverage in their travel packages. However, it is always better to purchase a policy from an independent company.
To decide the right trip cancelation insurance consider factors like how much are you spending on this trip and what non-refundable costs will be covered in your policy. For example, if your flight tickets are non-refundable or you have already paid for a spa package and if your trip might get canceled due to Covid, then having trip cancelation insurance is essential. Some travel insurers also offer comprehensive “cancel for any reason” policies.
Medical Insurance as a part of travel insurance only covers emergency healthcare and medical needs. More comprehensive policies also provide emergency evacuation and cover the cost of transport, hospitals, and any other medical service during the emergency. This insurance is recommended for those who frequently travel abroad, or indulge in adventure sports (this policy does not cover extreme adventure sports, check for special provisions if you need coverage for that).
Other types of medical insurance policies include:
- A service you can call that will direct you to an English-speaking doctor while you are overseas.
- Cash payment in the event of accidental death, loss of sight, or loss of limb.
- Expenses for repatriation of the persons’ remains in the event of death.
Baggage loss and delay coverage protect you if your luggage is lost, delayed, or stolen. This also covers your expenses till your bags arrive. For example, if your bag is going to arrive after a day, your insurance will cover the cost of essentials you need during this period. This might also cover the cost of replacing your passport or other important documents. Check this in your policy before deciding.
Flight delay or cancelation insurance covers the cost of accommodations, meals, and new travel arrangements if your flight is delayed or canceled. This policy comes in handy if you are a frequent flyer. Make sure to check the fine print to check things like the duration of the delay to get a claim, etc.
Annual Travel Insurance
If you are a frequent/full-time traveler, buying annual insurance is an affordable and hassle-free option for you. Usually, annual travel insurance is more like overall protection but may not cover very specific requirements.
Most annual policies provide coverage for medical emergencies, medical evacuation, and some coverage for lost luggage. These policies may not provide coverage against trip cancelation but you can get this at an additional cost.
Credit Card Based Travel Insurance
Many credit card companies provide travel insurance for free, or as part of their annual fee, as an added benefit to customers. This provides basic protection against your trips but doesn’t cover specific travel requirements. For example, if you’re an adventure traveler, a credit card travel insurance policy may cover very little for your requirements. But if you are someone who takes two vacations every year, this policy might just work for you.
Credit card insurance is a great backup but depending solely on it may not be the best option. It may not even provide coverage if you didn’t use your card to pay for your travel. Don’t rule out the idea of getting credit card based insurance, ask your insurer questions like:
- Does this policy include 24/7 emergency assistance?
- Does my policy cover stable pre-existing conditions?
- Does this policy have any age-based eligibility restrictions or exclusions?
- Does this policy include a family benefit?
- Is there a limit on the number of trips my policy will cover each year?
- Is there a limit on the number of days I can leave the country for one trip?
- Does this policy have any exclusions related to adventure travel or sports?
All of this may not apply to you but check what does and confirm with your company if they provide cover for those things.
How much does Travel Insurance cost?
The cost of the premium (either paid one time, quarterly or monthly) varies from company to company and you can get a quote based on your needs. The cost of the premium will depend on several factors, such as:
The age of the person
The general rule is: the younger the person, the lesser the cost of the premium. As you grow older, the cost of premium increases due to health risks associated and other healthcare factors.
The country you’re traveling to
Another important consideration to take into account when calculating how much travel insurance costs, is the destination where you are going to travel. For example, insurance for the U.S. costs more than insurance for other countries.
The duration of your trip
Travel insurance is the provision to cover you from door-to-door, which means it starts when you leave home and ends when you return. The longer your trip duration, the higher a policy’s premium. The cost is different for a three-day getaway, a two-week vacation, or backpacking for six months.
The budget for the trip
The cost of insurance increases with the budget of your trip. You have the choice to insure all, some, or none of your prepaid and non-refundable trip costs for trip cancelation coverage. Insurable trip expenses can include airfare, hotel accommodations, tours, and excursions, and lead to an increase in the insurance’s cost.
What’s included in the coverage
The cost of travel insurance increases the most depending on what’s included in the coverage. The cost goes up as the number of inclusions increases and how much coverage you can get for each. When choosing travel insurance that suits your preferences and needs, you should assess the coverage that you actually need because the more inclusive the travel insurance (more coverage and higher limits) the higher the price will be.
The amount of coverage
The coverage amounts included in a travel insurance policy can impact the prices substantially. For example, if you have a high amount of medical coverage in your travel insurance, the cost premium will be higher. Policies with higher amounts of coverage are often more expensive.
Cost of additional coverage (if any)
In addition to the basic coverage that travel insurance already offers you, if you are opting for other specific ones like adventure sports or tech equipment, etc. then the cost of your travel insurance will go up.
All the insurance companies offer a customized quote depending on the above factors. For example, according to a quote on travelinglifestyle.net a trip to Finland for 3 months for a U.S. national, traveler aged 22 is $323.83 and for a U.S. national traveler age 60, is $471.68 with different coverage amounts.
Although, you can find a general travel insurance policy with basic coverage at 5 percent of your total trip cost.
Common Travel Insurance Questions Answered
How to get a cheaper rate on a Travel Insurance Plan?
Along with discount codes/ special offers from the insurer, you can also save money if you get insurance for a specific country or destination you are traveling to. Most plans are cheaper when you exclude the U.S. If you’re a frequent traveler, you can also get annual plans or multi-trip plans to save money. Also, compare prices on different websites to save money on discounts and coupons.
When to buy Travel Insurance?
The right time to buy travel insurance is right after you book everything for the upcoming trip. If you’re getting one-time insurance, you will know the exact dates and duration of your travel. Preferably, you should purchase insurance on the same day.
How to make a claim?
The process differs with each company. Now it is possible to do everything online and companies like SafetyWing and WorldNomads have made the process straightforward and quick. Here are some general steps involved:
- Getting in touch with your insurer.
- Collecting all the evidence that you will need to support your claim (photographs, documents, etc.).
- Prepare your policy documents and take note of your policy number.
What insurer to get for tech gear coverage?
Some companies offer tech coverage for selective gear but you can get all your equipment insured at an additional cost. WorldNomads is one of the best companies for coverage for tech gear.
Pro tip: Submit receipts, date stamps, and pictures of your tech gear when getting them insured.
Is Travel Insurance the Only Option?
Travel insurance is the safest and most convenient option but it is not the only one. Getting travel insurance will cover most of your travel needs but you can also avoid or mitigate risk during travel without buying separate trip insurance.
Cancelation Policy Waivers:
Cruise lines and tour operators offer an alternative to travel insurance in the form of waiving their cancelation penalties. It’s often cheaper than insurance, but also a lot less comprehensive.
Personal Item Losses:
Your homeowners’ or renters’ insurance might offer protection against theft and loss. Your credit card might also cover some of the small stuff such as lost baggage and flight delays.
Book in Pieces:
Book refundable trip components separately from a third party with a hard deadline on cancelations. The major cost is flight tickets, which is often unavoidable but you can find one with flexible date change policies (especially after the pandemic)
Where to buy Travel Insurance Online?
There are various websites to compare, choose and buy travel insurance. You can check the policies, offers, compare prices and select the best plan for you. Some of the best websites to buy travel insurance online are:
Travel Insurance Loopholes
Insurance companies are running a business to make a profit. The policies are designed for your benefits as well as theirs. The devil is in the details and they have so many rules in the fine print that lead to smaller payouts, lengthy process for claims, denying the claim that it turns out you aren’t going to get paid when you think they have got you covered.
Sometimes choosing the cheapest plan means getting the least coverage. So while you might be excited about buying cheap insurance, check what they cover in that policy and how much you can claim. Remember, you only get what you pay for. The hidden terms and conditions always come out as smaller payouts in cheaper insurance. Here are some things to look for when choosing insurance:
- The medical portion of travel insurance is more about emergency care than being a replacement for your normal healthcare.
- Medical and accident coverage to pay for the expenses for illness on a trip.
- Repatriation and emergency evacuation to take you to the nearest medical facility in case you’re injured during your trip.
- And in case of reimbursement, if you need to end your trip earlier due to your sudden health issues, there should be a trip interruption and trip cancelation coverage.
- Theft and lost coverage to pay the expenses for stolen, damaged, or lost goods.
- Also, look for car collision insurance while traveling to a different country as it includes the payment for rental car damage.
- Get insurance with 24/7 assistance, if you need help finding a doctor abroad.
Your travel needs may be different but the primary provisions and terms of travel insurance are the same. Read carefully to understand the terms correctly, and get more information if you don’t understand something. SmarterTravel has covered a lot of information on the topic, check her blog out to know everything about travel insurance
What is NOT covered in Travel Insurance
Knowing what your plan does NOT cover is as important as knowing what it covers. Understand your requirements; see if they are covered in your plan; if not, check if you can customize your plan to fit these needs and then pick a plan. However, there are some things insurance policies will not cover even at an additional cost and some things can be covered at an additional cost. Here’s a list of things not covered in most travel insurance plans:
Things not covered in Travel Insurance:
- Alcohol- or drug-related incidents.
- Carelessness in handling your possessions and baggage: Your theft coverage won’t cover you if you left something unattended.
- Recklessness (how “reckless” is defined is a matter up to each company).
- Pre-existing conditions or general check-ups. For example, the insurance won’t cover expenses for your ongoing dialysis.
- Lost or stolen cash.
- If your travel destination is unsafe due to any red alert and your country’s government hasn’t called you for any evacuation, your insurance won’t probably cover it.
- Loss due to natural disasters/pandemics that began before your policy commencement.
- Things like ticket fraud, anything for which you lack documentation, and last-minute changes (unless mentioned otherwise).
- Deductible, a small amount of money that you will need to pay before realizing your claim.
Things covered in Travel Insurance at an additional cost:
Everything may not be included in your general travel insurance. In such cases, you can either get a special plan for your requirement, customize your policy to accommodate your needs, or check if there are any other companies already serving your requirements for cheaper rates.
- Protection against adventure activities like skydiving, hand gliding, paragliding, or bungee jumping. Most companies don’t cover adventure sports in their regular plan. WorldNomads and IMG Global give great coverage against adventure activities. You might also get this with your current insurer at an additional cost.
- Coverage for Tech gear: Not all travel insurance policies provide coverage against tech gear in their basic policy. You can get it insured at an additional cost or get separate equipment insurance.
- U.S. Coverage: You might have to pay extra for coverage in the US. Generally, companies offer this at an additional cost with general travel insurance to those who need it.
- Policy extension: You can either extend the period of your insurance or get it renewed at the end of every cycle. Most companies offer flexible extension policies at a minor additional cost.
Covid Coverage Travel Insurance in 2021
Before 2020, nobody paid attention to pandemic coverage in travel insurance. Since last year, this has become a key necessity in a travel insurance plan. There are some concerns about how the covid-inclusive package works, what to look for, and uncertainty around what is covered and what is not. The basic covid-inclusive travel insurance covers the following things:
Coronavirus-related emergency medical cover and repatriation
This covers treatment in an isolation ward if this is deemed necessary by your doctor, a hospital cash benefit, and COVID-19 tests if deemed medically necessary by a physician.
Cancelation cover if you are diagnosed with coronavirus
If your trip got canceled due to sudden lockdowns or flight cancelation to the country, your insurance policy would cover the cost of non-refundable expenses.
Cover for cancelation due to self-isolation without a positive test
If your trip got canceled due to covid, you or your family tested positive, covid coverage in your insurance policy will take care of the cancelation claim.
Faster turnaround times for treatment, pre-authorization, and claims processing.
Under the covid coverage insurance, the claim process will be faster and have a quicker turnaround time as compared to general healthcare turnaround time.
A lot of travel insurance providers have adapted to include protection against pandemics in their plans. Check their policies for protection against covid-19. Check what it covers, what are the rules if you had covid before, and what are the policies if your vaccination is done. According to ExperienceTravelGroup, some travel insurance policies that meet the above requirements are:
Best Travel Insurance Options for 2021
Choosing the right insurance is the most time-consuming part of the process. While a lot of companies offer customized plans to cater to all your needs, comparing other factors like deductibles, claim amount, and the ease of process helps in choosing the right company. Here are the top three picks with covid-19 coverage.
Allianz Global Assistance
Allianz is one of the most reputed names in travel insurance, it offers coverage for all essential travel insurance requirements with a high claim coverage rate. Along with coverage provision for emergency medical care, trip cancelation, travel documents, luggage loss, or delay, Allianz Global Assistance also covers some adventure activities and sports.
- Pre-existing medical condition coverage availability.
- Offers huge coverage against emergency evacuation, baggage loss, or damage claims.
- The cost of the policy is dependent on the cost of your trip.
- A variety of plans to choose from
- You can’t buy the coverage for canceling your trip for any reason.
- Fixed packages with standard coverage
- Can’t buy it during your trip
Medjet insures citizens of the USA, Mexico, and Canada. It offers extensive medical transport coverage and Global Covid-19 Coverage. It provides both short-term and annual plans for individuals, families, students, expatriates, and more. With multiple plans and membership options to choose from, you can pick a travel insurance plan for your entire family.
- Hospital to Hospital Medical Transfer for member regardless of medical necessity
- All-Expenses-Paid Air Medical Transport in the United States as well as internationally
- Covers both business and personal travel
- Healthcare centered plan covers very few travel requirements.
- Only a specific number of trips are covered every year.
IMG’s travel insurance packages have many features with maximum coverage at an affordable price. The cost of renewal of the policy is much cheaper than other insurers and they provide amazing coverage for adventure activities like scuba diving, bungee jumping, and skydiving.
- If you get lost, they will provide up to $10,000 for a search and rescue team.
- You get $500,000 in emergency medical coverage and $1 million in medical evacuation coverage.
- Coverage for cancelation due to any reason or interruption is included without an extra fee.
- Flawless customer service.
- They have a wait time before you can claim lost baggage or trip cancelation.
- The health coverage is not primary.
- U.S. citizens are not allowed to return home while the policy is in force.
- They do not directly bill medical providers.
- The coverage is based on the amount you plan to spend on your trip.
Having travel insurance doesn’t mean restricted travel or adding limitations to your trip, it only expands the limits of what you can do on a trip without worrying about what could go wrong. There is a policy out there that will perfectly fit your needs, you just have to go find it. Once you know what to look for, what to avoid, and what to ask, it becomes easier to find the best option for you. Travel far and travel safe!