How Much Is Travel Insurance? The Cost Of Coverage (& Who Needs It)

How Much Is Travel Insurance, & Is It Really Worth It?

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As we trudge through more pandemic ups and downs, one thing we can all agree on is that “Mama needs a vacation!” The bags are packed… but are you really ready to go? When planning a trip — either solo or with the family — there are some key factors to consider. Of course, in addition to packing for yourself, all the kids, and maybe even your partner (heck, if the family dog is along for the ride, you’ll be packing for Fido, too), these sort of significant travel considerations will likely fall on your getting-more-tense-by-the-minute shoulders. That’s the less than ideal news. The good news? Travel insurance literally exists to make travel less stressful for you. And while there are hundreds of questions popping into your head right about now, two have probably pushed their way to the front: How much is travel insurance and, subsequently, is travel insurance worth it?

Well, before we do a deep dive, let’s think about this for a minute. Are you highly accident-prone? Do you often lose important documents? Are you taking a tropical vacay during hurricane season or to a remote area? If the grandparents are coming on that long-overdue holiday vacation, is it possible an ill parent might need you to cancel a trip last minute? All of these are reasons to investigate travel insurance.

Travel insurance is not one-size-fits-all, and there is usually a plan out there to suit everyone’s needs — and, more to your most probable pressing thought, budget. Keep reading for everything you need to know before your next big trip.

How much is travel insurance?

As you might have expected, there’s no one quick and tidy answer here. Cost can vary by traveler, and each insurance provider calculates their premiums differently. These premiums are typically calculated using the total trip cost, age of traveler(s), length of travel, policy type, and the full coverage amount. Some plans also factor in your destination. Generally speaking, though, plan to spend between five to 10 percent of the total trip cost on comprehensive coverage. For example, using the five to 10 percent assumption, you might expect to pay between $300 and $600 on travel insurance for a $6,000 trip.

Not surprisingly, expensive trips cost more to insure. Likewise, luxury plans that offer more coverage are more expensive than basic plans.

Is travel insurance worth it?

That is entirely up to you. Consider these three questions when weighing your options, though:

  • What’s the cost of an emergency?
  • What’s the likelihood of an emergency?
  • Who pays if things go wrong?

Travel insurance falls under the umbrella of things that you never think you’ll really need… until you do. And when you do need it, you typically genuinely need it. To help put into context how “worthy” travel insurance might be for your family, you need to look at what a travel insurance plan could potentially cover.

What does travel insurance cover?

Generally, travel insurance covers trip cancellations, interruptions or delays, medical emergencies or evacuations, and lost, damaged, or stolen luggage. Most policies offer the following types of coverage:

Trip Cancellation Insurance

This coverage reimburses you for unused, non-refundable, prepaid costs (up to a limit) for a covered reason such as sickness, job loss, or flight cancellations due to adverse weather. This often refers to hotel rooms, transportation, etc. It can also include coverage for trip interruptions in times when you can’t continue a trip. It’s certainly handy to have in the event of a disease outbreak.

Lost or Stolen Baggage

This coverage reimburses you for lost, stolen, or damaged items, including passports, luggage, and carry-on bags.

Travel Health Insurance

Accidents and illnesses can happen, and it helps to be prepared — especially when traveling abroad. You may need to pay for medical care in some foreign countries out of pocket. This insurance covers you in those emergencies. The CDC recommends getting travel health insurance if you plan to travel more than six months, are doing adventure activities, or have a pre-existing condition. (Sadly, having a spouse who consistently won’t pack until five minutes before leaving does not count as a pre-existing condition.)

Check first with your current health care provider to see what they cover when traveling before pursuing a short-term supplemental policy.

Medical Evacuation Insurance

If you’re visiting a remote area or planning on partaking in dangerous activities, this coverage helps keep an incident from being financially crippling. This coverage can be bought separately or as part of your travel health insurance policy. Window shop when you look for a policy. Carefully read the fine print to find out exactly what each policy does and does not cover. Some companies will allow you to customize the policy with waivers for an additional fee.

What About COVID?

One of the industries most disrupted when COVID-19 emerged was the travel industry, with an insane amount of trip cancellations and postponements. Since then, travel insurance policies have adapted to include some pandemic coverage. Here’s what you need to know:

  • Most travel insurance plans will cover cancellations because of a coronavirus diagnosis. They will treat it like any other kind of unexpected illness, which also means that some insurance providers may ask for a doctor’s note.
  • Travelers who get COVID abroad should be covered. The CDC requires you to have a negative COVID test before returning to the U.S. Many common comprehensive policies will cover your nonrefundable travel costs should you develop symptoms while traveling. They also might pay for some of the cost incurred extending your trip if forced to stay put.
  • Feeling nervous about traveling is definitely not covered by insurance. Neither are last-minute government rule changes. Countries, states, and cities can suddenly change their rules to help stop the spread of the virus. For example, some require quarantine for new arrivals. The new normal is that travel has become unpredictable. Unfortunately, inconvenience is not covered by insurance plans. You can choose to spend up to 40 percent more than a standard policy and obtain an upgrade to your travel policy that includes the ability to “cancel for any reason.” But this option will likely still come with restrictions.
  • You might be required to obtain travel medical insurance to cover coronavirus expenses in some countries. A growing number of countries — such as Costa Rica, Aruba, and Israel — have implemented this policy.

How late can I purchase travel insurance?

Whether you’ve been planning this trip for years or feeling spontaneous, you can purchase most policies up until the day before you depart. The caveat is that you might not be eligible for some time-sensitive benefits — such as a pre-existing condition waiver — which often needs to be purchased in advance. When it comes to timing, remember that travel insurance won’t cover foreseeable trouble. You can’t notice a hurricane on the horizon and get travel insurance after the fact. You can’t start to feel sick and then grab travel health insurance.

No two travel plans are exactly alike, and there are certainly times where you don’t need travel insurance at all. Read the fine print, weigh your options, and ultimately, trust your gut. After all, you’re a parent; you got this. Safe travels!