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Travel Insurance and the COVID-19 Pandemic

Though it was unclear in early 2020 how the travel-insurance industry would cover COVID-19, insurance companies (and travelers) now have a fairly consistent way to handle coronavirus-related travel insurance claims.

While there are variations in policy by company, this is how most travel insurance companies are managing the pandemic:

• Trip cancellation is covered if you or a close family member gets sick with COVID-19, but not if you cancel or abort a trip for fear of contracting the virus while traveling.
• Cancellation may be covered if the U.S. State Department issues a travel warning for your destination.
• Cancel for any reason insurance may not necessarily cover cancellation for reasons related to COVID-19. Compare policies for their terms.

Check out Money’s coverage for more travel insurance tips and find out how to get the best post-pandemic cheap travel deals.

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Travel Insurance Guide

This guide provides a brief overview of what travel insurance is, how it works and how to choose the best travel insurance policy for you and your trip.

What is travel insurance for?

Travel insurance, also known as trip insurance or trip protection, is a type of insurance that will reimburse you if you need to cancel your trip or interrupt it early. It can also cover you if you get sick or have an accident during the trip.

Most travel insurance is sold for single-trip plans, meaning policies only cover whatever happens during the dates of the trip. However, multi-trip plans or annual plans will cover you whenever you may travel over an extended period making them ideal for frequent travelers.

What does travel insurance cover?

If you are looking to buy travel insurance you may have noticed many different types of coverage options and benefits. Ahead, we list some of the standard coverage found in travel insurance plans and common add-ons.

Trip cancellation insurance

Travel insurance will refund up to 100{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of the prepaid, non-refundable travel costs as long as the reason for cancellation is covered under the policy, and the trip has not yet begun.

Trip Interruption

If the trip has already started, you are typically reimbursed for the unused portion of the trip, as well as expenses you may incur to get back home, such as last-minute flights. Such interruption insurance may have a coverage limit, such as 150{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of the cost of the interrupted trip.

Travel Delays

Some insurance providers will also reimburse you for expenses that arise from travel delays, such as providing a daily amount for meals or lodging during the wait. Other companies cover you for airport delays arising from missed connections between flights. They will provide reimbursement for any flight change fees or additional expenses incurred while trying to catch up on your travel plans.

Emergency medical expenses

Travel insurance is also useful if you have a medical emergency during your trip. Benefits for medical expenses can range from $15,000 to $50,000; in some cases, additional coverage can be purchased as needed during the trip.

For serious conditions that require you to seek medical assistance outside of your travel area, you can also get coverage for emergency medical evacuation. This benefit will pay if you need to be evacuated to the nearest medical facility or even repatriated to a facility back in your home country. The maximum benefits usually range between $100,000 to $500,000 but can be as high as $1,000,000.

Baggage and personal effects

This coverage is intended to assist you if your luggage gets lost or is delayed during your trip. With baggage delay coverage, you must typically wait between two to six hours for the baggage to arrive before you can file a claim. The coverage includes reimbursement for replacement items you purchased during the delay, up to the policy limit.

If your bag is lost, travel insurance can reimburse you up to the policy limit, which is usually anywhere between $500 to $1,000. Claims typically require receipts on purchases or a list of items in the luggage and may be subject to a deductible. We recommend insured travelers make a list of items held in luggage and keep it on their person while traveling, in case they need them to make a claim.

Worldwide assistance

Insurers should have24/7 customer service available in most or all of the countries to which you’re traveling. Before leaving home, take note of the local contact information you need, including phone numbers and addresses and keep the information handy with your other travel documents.

Some insurers supplement customer service for their insurance with other emergency coverage. These may include 24/7 hotlines that allow you to reach multilingual medical services, sometimes via video, to provide medical advice and to refer you to local medical staff if in-person care is required.

Popular travel insurance add-ons

If your coverage needs go beyond what a basic travel insurance policy provides, a variety of add-ons or riders allow you to increase benefit limits and cover activities that may be excluded from standard policies.

Common add-ons include:

• Cancel for any reason coverage: Such coverage allows you to cancel your travel plans for almost any reason, and get reimbursed for your pre-paid travel costs.
• Pre-existing medical condition waiver: Most travel insurance companies won’t cover pre-existing conditions under the basic emergency medical expenses coverage. You can purchase a separate rider to cover your pre-existing conditions, subject to some limitations.
• Rental car insurance: This additional coverage will pay for damages to the rental car and injuries to yourself or others should an accident occur while traveling.
• Adventure sports coverage: This rider will cover injuries or losses caused by participating in adventure sports such as skydiving or bungee jumping. Claims that arise from these activities are typically excluded from basic policies.
• Identity theft protection: This optional coverage can help if you lose your passport and other identification, credit card or other important documents. (To learn more about identity theft, visit our guide on the best identity theft protection).

What is not covered by travel insurance?

Among the most common travel insurance exclusions are pre-existing medical conditions, injuries caused by extreme sports and theft/loss of some personal items such as electronic devices and jewelry.

With most travel insurance policies, you may only be covered if you cancel your trip for approved reasons like a serious illness or a death in the family. If you want the flexibility to cancel for any reason, you’ll have to purchase additional CFAR coverage.

If you need to purchase travel insurance while pregnant, you should be aware that the policy may not cover all pregnancy-related conditions. If you give birth during your trip, the medical emergency coverage may not cover the expenses of childbirth. On the other hand, you may be covered if an unexpected complication in your pregnancy arises during the trip.

Additionally, most travel insurance policies won’t pay for injuries that happen while you’re intoxicated with drugs or alcohol, even if the intoxicating substance is legal to use at the destination.

Finally, keep in mind that insurance companies may change their coverage at any time. As happened when the coronavirus pandemic began in 2020, many companies temporarily excluded COVID-19 infections from coverage and might do so again in the future. The insurer always has the final say on what is covered and what isn’t so review your policy documents thoroughly before the start of the trip.

Does travel insurance cover mandatory COVID testing?

In general, travel insurance does not cover the cost of COVID-19 testing, as required by the Centers for Disease Control for passengers entering the United States, unless the test is directed by a physician.

According to the CDC, passengers will be required to present a COVID test before departure from a foreign destination to the U.S. The agency also recommends getting tested 3 to 5 days after arrival, and quarantine for 7 days after the trip.

Some medical insurance plans cover COVID-19 testing, though, so check with your insurer to see if these are covered. Low or no-cost COVID testing may also be available at a health center near you.

How much is travel insurance?

The cost of travel insurance varies, but the average premium is about 5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of the cost of your trip with the average American spending $95 on travel insurance for a one-week overseas trip, according to travel insurance data from a study by AdvisorSmith.

Factors that affect the cost of insurance include the value of the trip, the age and number of travelers, the duration of your itinerary and the coverage options you select.

Many insurers offer group travel plans which can provide better value when traveling with a large party.

If you’re a frequent traveler, it can pay to purchase annual travel insurance plans so you don’t need to buy a separate policy every time you travel.

What is cancel for any reason travel insurance?

Cancel-for-any-reason (CFAR) coverage is offered as an upgrade to certain policies and provides a partial refund when canceling your trip, regardless of what caused your change of heart. Among the covered reasons is “fear of travel,” which is excluded under a basic travel insurance policy.

Not every travel insurance company offers a CFAR upgrade. This policy must be purchased within 14 to 21 days of the first trip booking and adding it to your policy may increase your total travel insurance bill by about 50{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}.

Companies that offer CFAR travel insurance include:

• AIG Travel Guard
• C&F Travel Insured
• Generali Global Assistance
• Arch RoamRight
• Seven Corners
• TravelSafe
• Trawick International
• USI Travel Affinity Insurance Services
• John Hancock
• HTH Worldwide

Does my credit card have travel protection?

Credit cards may include some travel protection that duplicates that of an insurance policy, usually covering the costs of tickets and reservations when the card is used to purchase them. But for most credit cards, the costs may be partial and benefits may be capped. Review the terms and conditions of your credit card travel protection plan to learn about what is covered before relying solely on it for travel insurance. Visit our guide on the best travel credit card for more information on how your credit card can help you travel smarter.

How to choose the right travel insurance policy

To find and pick the best travel insurance policy for your needs, follow these simple steps:

1. Identify your travel requirements to ensure that you’re not paying for something you don’t need.
2. Verify whether the policy covers travel to your chosen destination.
3. If you have a pre-existing medical condition, check whether it’s covered under the medical coverage of the policy you’re contemplating. If it’s not, you may need to purchase additional coverage.
4. Find out what kind of assistance you can expect from the travel insurance policy should your belongings be stolen.
5. Check the policy’s fine print before buying to ensure that it covers the activities you have planned for your trip.
6. Choose a policy that provides emergency assistance services.
7. Compare multiple quotes before making your final purchase.

Travel insurance is a type of policy that reimburses you for certain expenses and losses you experience while traveling. You must purchase the coverage before the trip, and commonly covered perils include having to cancel your trip due to an illness, or suffering a medical emergency during the trip.

Travel insurance policies cover unforeseen losses and expenses while traveling. Policies regularly include coverage for trip cancellation and trip interruption, emergency health care and car rental insurance, as well as reimbursement for lost baggage and costs related to trip delays. Some companies include coverage for trip specifics, such as extreme sports coverage or professional photo and video equipment.

The cost of travel insurance depends primarily on the cost of your trip. Typically, the premium is around 5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of your total trip cost. The cost may also vary depending on your age, the number of travelers, your destination and the additional coverages you select.

Trip interruption coverage is a component of travel insurance. This coverage will pay out if you need to interrupt your trip and go home early for a covered reason. The insurance company will reimburse you for the unused portion of the trip and help you with additional expenses you incur to get home.


These expenses will only be covered, however, if you cancel for one of the reasons covered by the policy. Examples of covered reasons are the serious illness or death of the policyholder or of another traveler on the policy or a close relative. A natural disaster at your destination is also a covered reason.

Most travel insurance companies offer multiple plans suited for a variety of needs. The most basic plans include only trip cancellation coverage but no post-departure benefits. Premium plans include benefits before and during your trip.


To calculate your insurance need, take stock of what losses -- if any -- you would incur in the event you need to cancel the trip in advance of departure. (Check, for example, whether your airline has reinstated cancellation fees; these have been widely suspended for trips booked during the  pandemic.)


Then, consider the risk of incurring injury during the trip. That likelihood may well depend on where you're going and what you will be doing. If you plan on taking part in high-risk sports, for example, you'll want to purchase additional coverage for these activities, since they're usually excluded from base coverage.

Most travel insurance companies sell their policies online. If you make your travel arrangements online through a fare aggregator such as Expedia, you may be offered a travel insurance policy when you check out. (It may or may not be the best value for you, of course.)


You can also purchase a policy through an online marketplace that shows you quotes from many companies. This is a good option if you want to see what different companies are offering and compare their prices.

Summary of Money’s Best Travel Insurance of 2021