Choosing a travel insurance plan and thinking about what might go wrong isn’t the most fun exercise when planning a trip. When weighing the chances of certain events and your budget, it can be tempting to simply pick the cheapest policy and be done with it. However, looking carefully at what coverage a policy provides might show some benefits and coverage levels that are more relevant to your trip than you may think. At the same time, other options might not be necessary for your specific trip.
Given that travel insurance policy prices can range from twenty dollars to several hundred dollars or more, it can pay off to be sure you’re getting the minimum coverage you need. It is equally important to ensure that you are getting all of the coverage you need. These days, unexpected and disruptive events are becoming more common. While choosing a bare-bones plan might be the right choice for your specific trip, taking the time to do a little comparison shopping for travel insurance before your vacation might prevent you from losing a lot of money down the road.
What Does Travel Insurance Cover?
Travel insurance usually covers reimbursement for trip cancellations for various reasons, but cheaper plans will generally cover fewer possibilities (known as covered reasons) than a plan with a higher price. The right type of insurance for a trip is going to vary by individual case. For example, some companies offer annual plans that cover trips of diverse lengths and destinations, but that might not be right for someone who travels less frequently. For those with health insurance covering services abroad, medical coverage may seem less of a concern. In general, it’s the logistical things like trip cancellations, trip interruptions and lost or delayed baggage that are most likely to occur.
Trip cancellation: if you must cancel your trip for a covered reason, travel insurance can reimburse you for your pre-paid and non-refundable trip costs that you insure. Most comprehensive travel insurance plans include trip cancellation as a basic coverage item; some to varying percentages and most with varying covered reasons.
Inclement weather: unexpected storms can delay flights for hours and sometimes force travelers into hotels for a night. Extreme weather like hurricanes and tropical storms can pose even bigger threats such as stranding people or endangering their safety. Reimbursement and support in the case of natural disasters is a standard offering for many travel insurance plans.
Military duty: some active military service people can be called to duty unexpectedly in certain events and have their leave revoked. For these individuals, many plans will cover the expenses of their unplanned travel interruptions.
Work obligations: like active service people, some professionals such as doctors or lawyers remain on-call for their work and can be called back unexpectedly, even while taking time off. When emergencies in their work require them to interrupt or cancel their vacation, some plans will reimburse for at risk trip costs.
Emergency situations: in cases of extreme weather events that damage buildings or make travel impossible, relocation or evaluation might be necessary.
Sudden illness or medical emergency: a cancellation or interruption of your trip due to an unforeseen illness or medical emergency can be an expensive and uncomfortable situation. Fortunately, this is a basic coverage of almost all plans.
COVID-19 and other public health emergencies: increasingly, travel is being disrupted by the COVID-19 pandemic. Most plans will cover you for trip cancellation, trip interruption and medical emergencies if you contract COVID-19. Cancellations due to outbreaks and changing national travel restrictions are making the optional Cancel For Any Reason upgrade increasingly popular as some get back to vacationing.
Trip delays: a missed connection or a flight delay might be an inconvenience for a longer trip, but for a short weekend or overnight trip, it could interfere with all of the travel arrangements. Missed events or reservations might be covered as well when affected by an unforeseen delay.
Loss or delay of baggage: one of the most common travel insurance claims is for replacements that individuals and families have had to purchase to enjoy their trip despite their baggage having been delayed or lost. Most plans cover up to a certain dollar amount for clothes or toiletries purchased.
Rental car accidents: most drivers have insurance on their cars, and rentals offer a level of protection. Some travel insurance plans also offer coverage for damage to rental vehicles. Not all travelers are going to be driving, so this option will be applicable only to some.
Severe accident or death: while extremely unfortunate, sometimes severe accidents can occur while you are traveling. Plane accidents, emergency medical services, and accidental death payments to survivors are covered by travel insurance plans to different extents.
Less Or More Coverage?
While everyone’s travel needs will be unique to their trip, certain basic coverage should be included in any travel insurance you purchase. Loss of baggage, trip delays and cancellations and emergency medical will apply to just about any type of trip you might take, and other types of coverage may be more optional. So, when might it make sense to choose the cheapest plan?
When you’re not renting a car: travelers to cities and resorts usually don’t need a car, so this is one coverage item that may be optional according to your plans and needs. If you’re visiting family or taking a road trip, the extra coverage might be helpful in case of an accident.
When you only need medical coverage: if you don’t have medical insurance that covers you while traveling abroad or outside of your state, getting travel insurance can provide you with coverage that you might not need at home. This offering is included in many plans, so if this is your reason for purchasing travel insurance, be sure to look closely at their coverage and compare plans.
When a work obligation won’t come up: many people don’t have jobs that will require them to abruptly cancel or change their plans. Flight cancellations and illness are more common cancellation coverages, but higher-priced insurance plans might include this option for business-people or other professionals.
Short trips: when you’re going away for a weekend or a few days, there is less time for things to go wrong. Most travel insurance you find will cover potential cancellations that might interfere with your trip, but if you don’t need anything beyond basic coverage for interruptions, you can probably go with a simpler plan.
Low-risk travel: certain travel plans are lower-risk than others. Going to a city or a tourist destination might be riskier due to the large gathering of people or exposure to tropical weather. In addition, travel insurance doesn’t usually cover high-risk activities like extreme sports or civil unrest at your destination. Visiting your family in your hometown or taking a business trip to a landlocked place may pose fewer risks than other situations.
Aside from specific items being covered, one of the biggest differences in the pricing of plans comes from the trip cost amount potentially being covered and issued in the case of need. As the cost and duration of your trip increases, so will the price of insurance, proportionately. This makes sense, though, so when you think of what a low price for coverage is, it will be relative. When choosing a travel insurance plan for your trip, thinking in terms of what is being covered is a useful guide to deciding how much is appropriate to pay for travel risk coverage.
Because even more expensive policies are still only a small percentage of the total cost of a trip, it pays to carefully consider the coverage you need for your trip and choose the best policy based on that rather than simply choosing the one with the lowest price. TravelInsurance.com can help you compare policies, coverage, and price so you can make the best and most informed decision when you choose a policy.
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