What Travel Insurance Covers (and What It Excludes)

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  • Travel insurance is intended to cover risks and financial losses associated with traveling.
  • Coverage can include trip cancellation, baggage protection, medical care, and emergency evacuation.
  • While monetary compensation is a primary benefit, travel insurance can also provide peace of mind.

Whether it’s a trip across the world or a trip across the state, having travel insurance can provide major relief if things go awry. Flight delays, lost baggage, illness, injuries, and other unforeseen events can disrupt even the best laid plans. And with a major disruption comes the potential for unanticipated expenses. 

Travel insurance and the coverage it offers can help keep you protected and save you money in the long run.

What is travel insurance? 

Travel insurance policies are designed to protect travelers from financial losses should something go wrong during their trip. There are a wide array of plans, but travel insurance typically includes several types of coverage.

“Common types of coverage include trip cancellation, trip interruption, baggage protection, coverage for medical care if you get sick or hurt during your trip, and emergency medical evacuation,” says Angela Borden, a travel insurance expert and product strategist for travel insurance company Seven Corners. 

Travel insurance coverage typically includes nonrefundable payments and other trip-related expenses. While monetary compensation is a primary benefit, there is another valuable perk of travel insurance, too: It can provide peace of mind. 

Insider’s Featured Travel Insurance Companies

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What does travel insurance cover?

Your specific travel insurance plan (and its terms and conditions) will determine the minutia and specifics of what is covered. As with most other forms of insurance, a general rule of thumb is that the more you spend, the more you’ll be covered. 

“Travel insurance can be confusing, so it’s best to research a reputable company that specializes in travel insurance and has a long history of successfully helping travelers all over the world,” says Borden.

Canceled and delayed trips 

A travel insurance policy can reimburse you for a prepaid, non-refundable trip if it is canceled. In addition, travel delay coverage provides reimbursement if a traveler is delayed. This can include hotels, airfare, food, and other related expenses.

Illness or injury

Typically, US health-care plans are not accepted in other countries. So travel insurance with medical coverage can be particularly beneficial when you are abroad. Medical coverage can also help with locating doctors and healthcare facilities. 

Emergency medical transportation 

Medical transportation coverage will pay for emergency evacuation expenses such as airlifts and medically equipped flights back to the US. Out of pocket, these expenses can easily amount to tens of thousands of dollars. Certain plans may even transport you to a hospital of choice for care. 

Lost or delayed luggage 

While most airlines will reimburse travelers if baggage is lost or destroyed because of their error, there may be limitations. Travel insurance plans will typically also cover stolen items, such as those stolen out of a hotel room. However, most policies won’t cover expensive jewelry, antiques or heirloom items. 

What does credit card travel insurance cover? 

A major perk on several travel rewards credit cards is embedded travel insurance coverage. Typically, you will need to use that specific card for the transaction (at least with partial payment) in order for protections to kick in. 

Each card has specific rules on what exactly is covered. But one of the industry leaders is the $550-per-year Chase Sapphire Reserve credit card. Here’s a snapshot of what is covered with this specific card:

  • Baggage delay: Up to $100 reimbursed per day for up to five days if a passenger carrier delays your baggage more than six hours.
  • Lost and damaged baggage: Up to $3,000 per passenger per trip, but only up to $500 per passenger for jewelry and watches and up to $500 per passenger for cameras and other electronic equipment.
  • Trip delay reimbursement: Up to $500 per ticket if you’re delayed more than six hours or require an overnight stay.
  • Trip cancellation and interruption protection: Up to $10,000 per person and $20,000 per trip for prepaid, non-refundable travel expenses.
  • Medical evacuation benefit: Up to $100,000 for necessary emergency evacuation and transportation when on a trip of five to 60 days and traveling more than 100 miles from home.
  • Travel accident insurance: Accidental death or dismemberment coverage of up to $100,000 (up to $1,000,000 for common carrier travel).
  • Emergency medical and dental benefit: Up to $2,500 for medical expenses (subject to a $50 deductible) when on a trip arranged by a travel agency and traveling more than 100 miles from home.
  • Rental car coverage: Primary coverage for damages caused by theft or collision up to $75,000 on rentals of 31 days or less

While more protections are included with cards that carry an annual fee, even the no-annual-fee Chase Freedom Flex, for instance, includes up to $1,500 per person (and up to $6,000 per trip) in trip cancellation and trip interruption coverage. 

However, there are some differences between credit card travel coverage and obtaining coverage from a third party. 

“Credit card coverage does not typically provide travel medical benefits,” Borden says. “For protection if you get sick or hurt while traveling, you’ll want a travel insurance plan with medical coverage.” 

Whether you get your travel insurance in a standalone policy or through a credit card, it’s important to review your plan details carefully. In either case, there may be exclusions and other requirements such as deadlines when filing a claim, Borden notes.

What does travel insurance not cover? 

Knowing what travel insurance doesn’t cover is as important as knowing what it does cover.

“Travelers should understand that travel insurance benefits come into play only if a covered reason occurs,” Borden says. Most standard travel insurance plans won’t reimburse you for the following: 

Cancel for any reason (CFAR)

Unless you specifically purchase cancel-for-any-reason travel insurance, your standard benefits won’t kick in unless it’s for a covered event. For instance, you won’t be reimbursed simply for changing your mind about taking a trip. 

Foreseen weather events 

While sudden storms or unforeseen weather events are typically covered by standard travel insurance plans, an anticipated and named hurricane, for instance, will not be covered. 

Pandemics and epidemics 

As COVID-19 disrupted travel around the globe, many travelers learned the hard way that some standard travel insurance plans do not cover pandemics and epidemics. While many policies have shifted to include pandemic-related coverage, it’s not always the case.

Medical tourism 

If you’re going to travel internationally for a medical procedure or doctor’s visit, your travel insurance plan will probably not cover you if something goes wrong. 

Pre-existing conditions and pregnancy 

Those with specific pre-existing conditions, such as someone with diabetes and needing more insulin, will typically not be covered by a plan. In addition, pregnancy-related expenses will likely not be covered under most plans. 

Extreme sports and activities 

Accidents oc curing while participating in extreme sports like skydiving and paragliding will typically not be covered under most plans. However, many plans offer the ability to upgrade to a higher-priced version that does cover these items.

The bottom line

Purchasing travel insurance is relatively straightforward, and Personal Finance Insider’s guide to the best travel insurance companies outlines our top picks. Remember, read your policy and its specifics closely to ensure that it includes the items you need coverage for. 

No one likes to dwell on how a trip might not go as planned before even leaving. However, at its core, travel insurance provides peace of mind as you go about your trip. While the upfront cost may seem significant, when you compare it to the potential expenses of a canceled flight, emergency evacuation or a hefty medical bill, it’s a small price to pay in the grand scheme of things.

Christopher Lewis

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