How to Choose the Right Travel Insurance

Edited By:

August 18, 2023

How to Choose the Right Travel Insurance

Joy Wallet is advertiser-supported: we may earn compensation from the products and offers mentioned in this article. However, any expressed opinions are our own and aren't influenced by compensation. To read our full disclosure, click here.

Travel insurance is a type of insurance policy designed to provide financial protection and assistance to travelers in case of unexpected events or emergencies that could disrupt or affect their trip. It is meant to cover various potential travel risks and expenses, such as trip cancellations, medical emergencies, lost luggage, flight delays, and more. Travel insurance policies can vary widely regarding coverage, cost, and specific circumstances they address.

Jump To

Features of travel insurance

Trip cancellation/interruption

This covers the costs if you have to cancel or cut short your trip due to illness, injury, death of a family member, or other unforeseen events.

Medical expenses

This covers medical costs incurred due to illnesses or injuries during your trip, including doctor's visits, hospital stays, medications, and emergency medical evacuation.

Baggage and personal belongings

This covers the cost of lost, stolen, or damaged baggage and personal items during your trip.

Travel delay

This reimburses additional expenses incurred due to significant travel delays, such as accommodation and meals.

Emergency evacuation

This covers the expenses related to emergency medical evacuations, especially when the local medical facilities are inadequate.

Accidental death and dismemberment

This benefits in the event of accidental death or serious injury during your trip.

Travel assistance services

This includes 24/7 access to assistance services, such as help with finding medical facilities, replacing lost travel documents, and other travel-related emergencies.

Types of travel insurance plans

Several types of travel insurance plans are available, each designed to address specific needs and risks that travelers may encounter during their trips. Here are some common types of travel insurance plans:

Trip cancellation/interruption insurance

This type of insurance covers the costs associated with canceling or interrupting your trip due to unexpected events such as illness, injury, death of a family member, natural disasters, or other unforeseen circumstances. It typically reimburses you for non-refundable trip expenses.

Travel medical insurance

Also known as travel health insurance, this coverage provides medical assistance and coverage for medical expenses incurred while traveling. It's especially important when traveling internationally, as your regular health insurance may not cover medical costs abroad.

Baggage and personal belongings insurance

This insurance covers the loss, theft, or damage of your baggage and personal items during your trip. It can help reimburse you for the cost of replacing essential belongings.

Travel delay insurance

Suppose your trip is delayed for reasons beyond your control, such as flight cancellations, severe weather, or other unexpected events. In that case, this insurance can cover additional expenses like accommodation, meals, and transportation.

Flight accident insurance

This type of insurance provides a lump-sum payment to your beneficiaries in the event of accidental death or dismemberment while traveling on a commercial airline.

Emergency medical evacuation insurance

This coverage is essential for travelers going to remote or risky destinations. It covers the costs of emergency medical evacuations to a medical facility capable of providing appropriate treatment.

Rental car insurance

If you plan to rent a car during your trip, rental car insurance can cover damages to the rental vehicle in case of accidents, theft, or vandalism.

Cancel for Any Reason (CFAR) insurance

This optional add-on allows you to cancel your trip for any reason, including reasons not typically covered by standard trip cancellation insurance. It provides greater flexibility but may come at a higher cost.

Adventure or sports travel insurance

If your trip involves activities such as adventure sports, skiing, or other high-risk activities, this type of insurance can provide coverage for injuries and accidents related to those activities.

Cruise travel insurance

Cruise-specific insurance can cover the risks associated with cruises, such as missed port departures, itinerary changes, and medical care on board.

Group travel insurance

This type of policy is designed for groups traveling together, such as families or organized tours. It often provides coverage at a lower cost per person than individual policies.

Business travel insurance

Business travel insurance is tailored to the needs of business travelers, providing coverage for work-related activities and potential travel disruptions.

Cost of travel insurance

The cost of travel insurance can vary widely based on several factors, including the type of coverage you choose, the duration of your trip, your age, your destination, the level of coverage, and the insurance provider you select. Here are some factors that can influence the cost of travel insurance:

Type of coverage. Different types of coverage, such as medical expenses, trip cancellation/interruption, baggage loss, and more, will contribute to the overall cost. Comprehensive coverage that includes a variety of protections will generally cost more than a basic policy.
Trip duration. The length of your trip is a significant factor. Longer trips tend to have higher insurance costs because they entail a longer period of potential risk.
Age of traveler. Generally, older travelers might pay higher premiums due to a higher likelihood of medical issues and other travel-related risks.
Destination. The cost of travel insurance can vary based on the destination's healthcare costs, the risk level associated with that location (for example, a destination prone to natural disasters), and the local medical facilities available.
Coverage limits. Higher coverage limits, which dictate the maximum amount the insurance company will pay out for certain expenses, can increase the cost of the policy.
Deductibles. If your policy has a deductible (the amount you have to pay out of pocket before the insurance coverage kicks in), a lower deductible might lead to a higher premium.
Additional riders or add-ons. Some policies offer optional add-ons or riders that provide extra coverage for specific scenarios. Adding these can increase the overall cost.
Pre-existing conditions. Coverage for pre-existing medical conditions might lead to higher premiums or require specialized policies.
Group policies. Some insurance providers offer discounts for group policies covering multiple travelers, such as families or travel groups.
Provider. Different insurance companies offer various pricing structures and coverage options. It's a good idea to compare quotes from multiple providers to find the best balance of coverage and cost.

As a rough estimate, travel insurance can cost anywhere from 4% to 10% of the total trip cost. However, this can vary widely, so getting quotes from multiple insurance providers is recommended to find a policy that meets your needs and budget. Remember to carefully read the policy details to understand what is covered and any exclusions or limitations.

Tips for choosing the right travel insurance

Choosing the right travel insurance requires careful consideration of your travel plans, personal needs, and the potential risks you might encounter. Here are some tips to help you select the best travel insurance for your trip:

Assess your needs

Start by evaluating your travel plans, destination, activities, and any potential risks you might face. This will help you determine which types of coverage are essential for your trip.

Research providers

Look into reputable travel insurance providers that offer a range of coverage options. Read reviews, compare plans, and consider factors like customer service, claim processing, and overall reputation.

Compare coverage

Compare the coverage and benefits offered by different plans. Pay attention to what is included and excluded in each policy. Make sure the coverage aligns with your needs and the potential risks of your trip.

Check exclusions

Carefully read the policy's exclusions and limitations. Some policies may not cover certain activities, pre-existing conditions, or specific destinations. Ensure you understand what is not covered.

Consider trip length

If you're taking a longer trip, consider insurance that offers coverage for the entire duration. Some policies have maximum trip length limits.

Medical coverage

If traveling internationally, ensure that the travel medical insurance offers sufficient coverage for potential medical expenses in the destination country, including emergency medical evacuation.

Cancellation coverage

If you're concerned about trip cancellations, select a policy that provides trip cancellation/interruption coverage. Make sure you understand the covered reasons for cancellation.

Coverage limits

Check the coverage limits for different aspects of the policy. Ensure they're sufficient to cover potential expenses, such as medical costs or lost belongings.

Deductibles

Understand the deductible amount for each coverage type. A higher deductible might lower your premium but could also mean higher out-of-pocket expenses if you need to make a claim.

Additional benefits

Consider any additional benefits or features the policy offers, such as travel assistance services, coverage for rental cars, and coverage for adventure activities, if applicable.

Pre-existing conditions

If you have pre-existing medical conditions, make sure the policy provides coverage for these conditions or offers a waiver if you meet certain criteria.

Read reviews

Look for reviews from travelers who have used the insurance company's services. Positive reviews can indicate good customer experiences and efficient claims processing.

Understand claims process

Familiarize yourself with the claims process of the insurance provider. Understand the steps you need to take in case you need to file a claim.

Cost and value

While cost is a factor, don't base your decision solely on price. Consider the value of the coverage provided relative to the potential benefits and protection it offers.

Consult with experts

If you're unsure which policy to choose, consider consulting with a travel agent, insurance broker, or financial advisor specializing in travel insurance.

Remember that travel insurance is a form of risk mitigation, and it can provide peace of mind during your trip. Carefully reviewing your options and selecting the right coverage can help ensure you're adequately protected in unexpected events.

Travel insurance exclusions

Travel insurance policies often come with specific exclusions, which are situations or circumstances not covered by the insurance. To understand what is not covered, it's crucial to thoroughly review these exclusions before purchasing a policy. While the specific exclusions can vary between policies and providers, here are some common travel insurance exclusions to be aware of:

Pre-existing medical conditions. Many travel insurance policies exclude coverage for pre-existing medical conditions unless you purchase a specific policy that includes coverage for these conditions or qualify for a pre-existing conditions waiver.
High-risk activities. Some policies may exclude coverage for injuries or accidents during high-risk activities such as skydiving, bungee jumping, or other adventure sports.
Intentional acts. If you intentionally put yourself in harm's way or engage in risky behavior, resulting in injuries or losses may not be covered.
Mental health issues. Some policies may exclude coverage for mental health-related issues like anxiety, depression, or other psychological conditions.
Alcohol or substance abuse. Injuries or incidents resulting from alcohol or substance abuse might not be covered.
Unapproved destinations. Some policies might exclude coverage if you travel to a destination under a travel advisory or warning issued by your government.
Civil unrest and war. Policies may exclude coverage for incidents related to civil unrest, war, terrorism, or acts of war.
Non-medical evacuations. Some policies might not cover the costs if you need to be evacuated for reasons unrelated to a medical emergency, such as political instability.
Traveling against medical advice. If you travel against a physician or medical professional's advice, health issues might not be covered.
Unattended belongings. Loss or theft of belongings left unattended in public places may not be covered.
Extreme weather conditions. Weather-related events, like hurricanes or natural disasters, might have specific exclusions or limitations.
Excessive valuables. High-value items like expensive jewelry, electronics, or cash might have coverage limits or exclusions.
Pregnancy-Related Issues. Some policies may exclude coverage for pregnancy-related complications or childbirth.
Illegal Activities. Incidents or losses while engaging in illegal activities might not be covered.
Non-Refundable Costs. If you cancel your trip for a non-covered reason, the non-refundable costs may not be reimbursed.

The bottom line

No matter the destination you are headed to, travel insurance is a smart investment and will protect you in emergencies or unfortunate incidents. It mitigates risks and offers peace of mind. Although the costs vary depending on the plan type, your age, the destination you are headed to, pre-existing medical conditions, and coverage limits, it is worthwhile to compare all the options and then decide.

Joy Wallet is an independent publisher and comparison service, not an investment advisor, financial advisor, loan broker, insurance producer, or insurance broker. Its articles, interactive tools and other content are provided to you for free, as self-help tools and for informational purposes only. They are not intended to provide investment advice. Joy Wallet does not and cannot guarantee the accuracy or applicability of any information in regard to your individual circumstances. We encourage you to seek personalized advice from qualified professionals regarding specific investment issues. Featured estimates are based on past market performance, and past performance is not a guarantee of future performance.

Our site doesn’t feature every company or financial product available on the market. We are compensated by our partners, which may influence which products we review and write about (and where those products appear on our site), but it in no way affects our recommendations or advice. Our editorials are grounded on independent research. Our partners cannot pay us to guarantee favorable reviews of their products or services.

We value your privacy. We work with trusted partners to provide relevant advertising based on information about your use of Joy Wallet’s and third-party websites and applications. This includes, but is not limited to, sharing information about your web browsing activities with Meta (Facebook) and Google. All of the web browsing information that is shared is anonymized. To learn more, click on our Privacy Policy link.

Images appearing across JoyWallet are courtesy of shutterstock.com.

Share this article