Do You Really Need Travel Insurance?

Unlike a sturdy suitcase or hotel reservation, it’s not always clear if you really need travel insurance when you travel—whether it’s a comprehensive travel insurance package through a provider like WorldNomads, or that “protect my trip” add-on offered while purchasing an airline ticket.

So is travel insurance worth it? The answer for you will depend on where you’re going, what kind of insurance coverage you already have through your credit card or other insurances, as well as several other factors. To help you figure out if you need to purchase travel insurance for your next trip, we’ll go over when it’s worth it, when you don’t really need it, and what different forms of travel insurance cover.

What is already covered by airlines, credit cards, and other insurances

Most travelers already have at least some coverage and protection from mishaps on the road through their credit card, other insurance policies—like homeowner’s, renter’s, auto, and health insurance—as well as airline and cruise ship policies.

Homeowner’s, renter’s, health, and auto insurance

Some insurance policies, such as your homeowner’s, renter’s, health, or auto insurance, can protect parts of your trip, like medical care, stolen possessions, or damage to your rental car. Many policies do not cover international travel, so it’s worth checking with your provider (especially your healthcare provider) before assuming you’re covered abroad.

Travel credit cards

The most popular cards typically come with some form of travel insurance to cover lost luggage, trip cancellation, and even rental car damage. For example, American Express Platinum cardholders are protected if their luggage is lost or delayed. The JetBlue World MasterCard from Barclaycard kicks in coverage for meals and accommodations if your trip is delayed at least six hours. The United MileagePlus Card through Chase will protect you in the case of rental car theft or collision.

No matter the card, you must pay for your trip with that credit card in order to file claims against its travel insurance. In the case of flight disruptions or lost luggage, your credit card insurance will only apply after the airline has done its part to cover any losses.

One big gap in travel credit card insurance is emergency medical or dental insurance. If your usual healthcare provider won’t cover you on your trip, which is often the case for international travel, additional travel insurance is worth it.

Insurance included with your flight or cruise

“Travel insurance plans offered by airlines and cruise lines are often written with the companies’ best interests in mind,” says Joe Cortez, travel columnist for MileCards.com. “While those policies will cover some situations, they usually come with strict limitations.”

If the delay is due to maintenance or situations under the airline’s control, the carrier must provide hotel accommodations if the delay requires an overnight stay and a meal allowance if your wait crosses over a mealtime. Sometimes, these allowances are not always offered at the gate; you may need to ask for them.

If the delay is due to weather or air traffic control, you’re on your own. The occasional exception might be made for fliers with an airline’s top elite status or premium cabin tickets, but this is becoming less common as carriers tighten budgets and wrench away control from gate and reservations agents. That’s when travel insurance would save the day. If you’re trying to catch a cruise ship or make an important deadline, travel insurance (whether purchased or through your credit card) can make all the difference.

If you are traveling on an airline whose home base is in the European Union or departing from a European Union city, there is built-in coverage for extended delays that are within the airline’s control. It is known as the EC261 Flight Compensation Regulation, which can provide, at the very least, hotel and meal assistance.

When is travel insurance worth it?

While your lost luggage may be covered by your credit card, additional travel insurance is worth it if you’re taking an expensive trip, need additional medical coverage, or are participating in adventure sports or high-risk activities. It’s almost always worth it for international trips, where your usual insurance policies may not cover you and can fill gaps of other insurance—for example, if your healthcare plan only covers you domestically or if maximums for lost luggage or stolen belongings are too low.

It’s also helpful if you’re worried about traveling during a pandemic, like COVID-19. In this case, be sure to purchase a cancel for any reason (CFAR) insurance add-on since base policies do not cover pandemics. If you cancel, this will allow you to get a refund of 50 to 75 percent of your trip costs.

Travel insurance is worth it if you:

• are planning an expensive trip
• travel with expensive gear and luggage
• are traveling internationally, especially for medical coverage
• aren’t covered for important situations, like emergency medical care, by existing travel insurances
• are planning a trip during a pandemic
• plan on participating in a hazardous sport or adventure travel (WorldNomads is one of the best insurance providers for this)

On occasion, travel insurance can protect you even before your journey has begun. Perhaps a hurricane or forest fire has prevented you from reaching the airport, or worse, it’s damaged your possessions to the point where you choose not to travel.

When comparing travel insurance plans, be sure to check the fine print and make sure it covers your needs. For example, if you’re spending more than $5,000 on your trip, you may need to upgrade to a more premium plan to fully cover what you’ve spent in the case of a trip cancellation.

What does travel insurance cover?

If you buy a comprehensive travel insurance package, like that offered by WorldNomads or Allianz, it will cover any or all of the following:

• trip cancellation and interruption
• trip delays and missed connections
• lost or damaged baggage and personal belongings
• emergency medical and dental care
• emergency medical evacuation
• accidental death, dismemberment, and repatriation
• concierge and 24/7 service
• cancel for any reason (CFAR) insurance (typically an add-on or upgrade)

The most important part of any travel insurance plan is coverage for hospital costs and repatriation home, which is rarely covered in other insurance plans. You may have to upgrade from a basic plan to get this. While a basic plan may cost as little as $8 per day, a premium upgrade could cost up to 10 percent of your total trip.

When do I not need travel insurance?

You may not need to buy travel insurance if you’re already covered for most situations through your credit card, the airline’s policies, and other insurances you already pay for.

For example, if you’re going on a domestic road trip, your usual auto and health insurance will cover most emergency situations. Additional travel insurance would really just cover any prepaid expenses (like hotels) in the case of a trip cancellation or delay. If you’re comfortable losing that money (for example, the cost of a few campsite reservations), you may not need travel insurance.

While travel insurance may seem like yet another expense as you plan—and pay for—your travels, it can often be worth the cost.

This article was published on October 21, 2017; it was updated on June 26, 2020, to include new information.

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