What Does Travel Insurance Cover?
Comprehensive travel insurance policies package together a number of valuable benefits. You can also buy policies that cover only trip cancellation or only medical expenses. With the wide variety of travel insurance plans available, you can find coverage levels that will fit your budget and trip needs.
Look for these top coverage options in a comprehensive travel insurance plan.
Trip Cancellation Insurance
You don’t book a trip with the intention of canceling it, but unexpected illness, injury, family member sickness, jury duty and more could disrupt plans. Trip cancellation insurance reimburses you 100% for money you lose in prepaid, non-refundable deposits if you have to cancel for a reason listed in the policy.
If Covid is a concern, you can find travel insurance policies that cover Covid-related trip cancellation if you contract the virus right before the trip.
A good strategy for trip cancellation coverage is to buy insurance for the total amount you have put into non-refundable and prepaid deposits. Don’t insure refundable amounts, like refundable plane tickets, because you can’t make an insurance claim for that.
Travel Delay Insurance
It can be inconvenient, stressful and costly if your trip is delayed due to unforeseen events.
Travel delay insurance reimburses you for expenses if you’re stuck somewhere due to a holdup that’s covered by your travel insurance plan. For example, if you’re stranded in an airport all day because bad weather delays your flight, travel delay insurance can reimburse you for necessities like food and toiletries.
If you have a long delay, travel delay benefits can pay for an Uber, a night in a hotel and meals. Travel delay insurance has a specified waiting period before benefits apply—for example, six or 12 hours—and also a per day maximum limit and a total maximum per person.
“Cancel for Any Reason” Coverage
If you want the freedom to cancel your trip no matter what, look for travel insurance that allows you to upgrade your trip cancellation insurance to “cancel for any reason” (CFAR) travel insurance. Having CFAR allows you to cancel your trip for any reason that’s not listed in your base policy. For example, you could cancel the trip because you simply don’t feel like going anymore, as long as you do so at least 48 hours before your departure time.
Reimbursement under a CFAR claim is 75% or 50% of your trip costs, not the 100% that’s available under the base trip cancellation coverage. CFAR adds an average of about 50% to an insurance plan’s cost. Not all travel insurance companies offer a CFAR upgrade.
Travel Medical Insurance
Travel medical insurance pays for ambulance service, X-rays, lab work, medicine, doctor and hospital bills, and other medical expenses during your trip. This is important coverage for travelers going abroad, where your U.S. health plan may have limited global coverage or no coverage. You can find generous coverage limits of up to $500,000 per person with some travel insurance policies, but you may decide that lower levels of coverage are adequate for your needs.
The best travel insurance for seniors includes travel medical insurance because Medicare does not pay for health care outside the U.S., except in very limited circumstances.
Many travel insurance policies cover Covid-related medical expenses just like any other illness—but not all do—so be sure to confirm that Covid is covered by your travel insurance policy if you contract the virus during your trip.
Emergency Medical Evacuation Coverage
This is also important coverage for those traveling abroad, especially if you’re going to a remote area where quality medical care might be hard to find. Emergency medical evacuation insurance pays to get you to the nearest adequate medical facility. You can find ample coverage of $1 million per person in the best travel insurance policies..
Trip Interruption Insurance
If you have to cut your trip short because of a reason listed in the policy, trip interruption insurance is valuable coverage to have. It can reimburse you for the non-refundable parts of your trip that you miss, such as a resort stay or prepaid scuba diving lesson. It can also pay for a last-minute one-way ticket home if you have an emergency.
Baggage Delay Coverage
Your bags may be on their own detour, but what do you do while you’re waiting? This coverage reimburses you for necessities while you wait for your luggage. For example, if you’re in Canada you may need a coat, hat and essential toiletries. Policies usually require a certain time delay before baggage delay coverage kicks in, such as six hours.
Baggage Loss and Personal Effects Coverage
If your luggage doesn’t arrive at your destination when you do, it can throw your trip into chaos.
Baggage insurance can at least ease the financial pain a little. It can reimburse you for the bags and clothes and shoes that never arrive, but note that reimbursement is for the depreciated value of the items, not the cost to buy new ones. It also pays out for items lost to theft.
Travel Accident Insurance
Some travel insurance policies provide compensation for accidental death and dismemberment (AD&D). If an accident that’s covered by the policy kills or dismembers the policyholder during the trip, travel accident insurance pays out the specified amount.
Generally, AD&D travel insurance benefits cover death and the loss of feet, hands, sight, hearing, speech and fingers on the same hand caused by an accident. It usually pays out a percentage of the maximum benefit, depending on the loss. For example, the Atlas Journey Premier plan from WorldTrips includes $25,000 in AD&D coverage. It pays out 100% of the benefit if the policyholder loses both hands or both feet, both eyes or a hand and a foot. But it pays 50% if they lose either a hand or a foot or the sight in one eye.