What is travel insurance, and is it worth?

As more and more individuals look to plan future travel during this uncertain time, the importance of travel insurance is growing. To put it briefly, travel insurance is specific coverage for unforeseen events that may arise while traveling. It is available in a variety of forms. It can be obtained as a benefit from some travel credit cards or paid for out of pocket.

Trip (also known as travel) insurance covers unforeseen circumstances that may arise prior to, during, or following your trip. Examples include bad weather that prevents you from leaving or breaking your leg during a ski trip and having to return home early.

The US Travel Insurance Association estimates that 65.8 million individuals had trip insurance coverage in 2018, a 49% increase from 2016. Owing to the COVID-19 pandemic, those figures are probably going to keep rising.

Many companies offer travel insurance plans, which can differ from state to state and are available on select premium travel credit cards.

What does travel insurance cost?

The US Travel Insurance Association reports that the cost of a travel insurance policy typically falls between 4% and 8% of the total trip cost.

The length and cost of your vacation: The more expensive and extended the trip, the more the policy will cost. These are the main factors that determine the cost of the policy.

Cost of local medical care: If your destination has high medical care costs, your travel insurance premium may go up.

Coverage breadth: More covered events and higher limits are included in more expensive policies.

Your age: In general, the cost of the policy increases with age.

Is travel insurance worth it?

Having travel insurance could be especially helpful if:

You’ve spent a lot on prepaid, non-refundable expenses

You’re traveling internationally where your health insurance won’t apply

You’re traveling to a remote area or for an extended period

You have an existing health condition

You’ve scheduled adventure activities such as skiing, bungee jumping or hang-gliding

Your flight involves multiple connections or destinations