I’m going to take an in-depth look into why travel insurance is probably a good idea if you are headed overseas and some questions to ask your chosen insurer before you buy a policy.
Why buy travel insurance?
This article will mostly look at the benefits of travel insurance for trips outside of the US as that is where the costliest risks for travelers lie. If you only take domestic trips you should still consider a policy but you probably won’t need the health coverage part as your health insurer will cover you and your family nationwide.
Health
This is the most important aspect of cover, as healthcare is crazy expensive and illness and injury tend to strike at the most inconvenient times. Especially when we are doing unfamiliar things in unfamiliar places.
If you are resident in the US and have private healthcare, you are probably covered worldwide for emergency treatment but little else. The US State Department suggests calling your insurer and asking a few questions: what medical coverage will I receive outside the US?
Do you cover emergency evacuation? What about repatriation? Or an emergency related to an ongoing medical condition?
Trip cancellation and delay
Most insurance policies include cover for the cost of your trip in case you have to cancel, or if the airline/accommodation/tour operator goes bankrupt.
You will also get coverage if the airline loses or damages your luggage. As vacations are luxuries, you might feel that you can take the hit. If you are taking expensive sporting equipment with you that you can’t easily replace, or this is a trip of a lifetime you won’t be able to afford again, it’s definitely worth getting a policy.
Car rental coverage
If you are renting a car at your destination, find out the country’s rules for insurance before you go. In some places, third party coverage is included in the price, while others consider this a separate cost and will not let you rent the car until they see proof of coverage. This is usually an expensive policy purchased at the desk. Buying a policy ahead of time, either as part of your travel insurance or as a separate policy will save you money overall.
When should I buy travel insurance?
Most insurers allow you to buy a policy up to the day before travel. However, it makes more sense to buy one as soon as you have booked your trip, as you will then be covered for cancellation immediately.
Where should I get a policy from?
You probably already have home, health or car insurance policies – ask your insurer if they offer travel insurance and if there is a multi-policy discount available.
Consider an annual policy if you make a few trips – you will then be covered for all your last minute trips as well as your bigger annual vacation.
What about the fine print?
Most travel horror stories involve people who didn’t have a travel insurance policy but there are a few who got caught out by “fine print”. Be aware that you are covered for the dates you give your insurer and if you change your flights home to stay a little longer you are no longer covered.
“Pre-existing conditions” is a common issue. If you have a medical condition be sure to ask your insurer whether this will invalidate your policy, or what would happen if you have an emergency related to this condition while overseas.
“Extreme sports” is another. If you intend to do anything exciting, like skiing or scuba diving, check out this section of your policy. Many activities are not covered at all and require extra coverage.
If you bought your flights, accommodation or car hire using frequent flyer miles, any losses will probably not be covered.
If you cancel due to psychological disorders, this is often not covered.
If you are concerned about any of these things, ask for a policy that includes “cancel for any reason” coverage. It can often be added as a supplement. Buy this one with plenty of time before your trip as there is generally a 10-15 day gap before purchase and coverage start.
The short version
If you…
…are going outside the US, yes you do need travel insurance and you should buy it as soon as you have booked your tickets
…want to scuba dive, ski or do anything else exciting you need “extreme sports” coverage
…have a pre-existing medical condition, ask your insurer about the implications
…are spending a fortune and want peace of mind regarding cancellation, get “cancel for any reason” coverage
…are hiring a car don’t forget rental insurance
Don’t forget to take the details with you – another benefit to travel insurance is a 24-hour helpline for round-the-clock travel advice.
If you are not going overseas, check some of your existing policies and with your credit card provider – you may already be covered for some expenses without needing an additional travel insurance policy.
