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Do I Really Need It?

You've planned the trip. You've paid the deposits. You've booked the flights.

And then someone asks:

"Would you like travel insurance?"

It's tempting to think, I'm going on vacation. What could possibly go wrong?

Hopefully, absolutely nothing.

Travel insurance is for the things we don't plan.

But before purchasing a policy, it's important to understand that "travel insurance" isn't one universal product—and it doesn't mean that absolutely everything that goes wrong with your vacation will be covered.

Here's what to know.

🧳 What Can Travel Insurance Cover?

Depending on the policy, travel insurance may include protection for things such as:

  • Trip cancellation
  • Trip interruption
  • Travel delays
  • Lost or delayed baggage
  • Emergency medical expenses
  • Emergency medical evacuation

The key words are depending on the policy.

Policies have limits, exclusions and specific circumstances under which benefits are payable.

That's why it's important to look beyond the words travel insurance and understand what you're actually buying.

❌ Trip Cancellation

Trip cancellation coverage may reimburse prepaid, nonrefundable expenses when you have to cancel for a covered reason listed in your policy.

Covered reasons vary.

Depending on the policy, examples might include certain illnesses, injuries, deaths or other specified events.

The important point is this:

Changing your mind isn't necessarily a covered reason.

Neither is every possible event that might cause you to cancel.

Read the policy's covered reasons and exclusions.

🏠 Trip Interruption

Trip interruption is different.

Instead of something preventing you from starting your vacation, something happens after the trip has already begun and you need to cut it short.

Depending on the policy and circumstances, trip interruption coverage may help with certain unused prepaid expenses or additional transportation costs.

Again, the reason for interrupting the trip generally needs to qualify under the policy.

🩺 What About Medical Care?

This is a big one for international travelers.

Don't assume your regular U.S. health insurance works everywhere in the world.

Before traveling internationally, find out exactly what your existing health plan covers outside the United States.

And if you're covered by Medicare, pay particular attention.

⚠️ A Special Note for Medicare Travelers

Original Medicare generally does not cover healthcare outside the United States, except in limited circumstances.

Some Medicare Supplement (Medigap) policies provide foreign-travel emergency benefits, but coverage varies.

If you have Medicare or a Medicare Advantage plan, don't assume you're covered—or assume you're not.

Check your particular coverage before traveling.

Find out:

  • Whether emergency care abroad is covered
  • What deductibles or limits apply
  • Whether you must pay first and request reimbursement
  • Whether medical evacuation is covered

Knowing this before you leave is much better than discovering it from a hospital bed in another country.

🔘 Medical Evacuation

This is one of the least glamorous—and potentially most important—parts of travel insurance.

If you're seriously ill or injured somewhere that cannot provide the care you need, you may require transportation to another medical facility.

In some situations, that can mean an air ambulance.

Those costs can be enormous.

Medical evacuation coverage is designed to help with qualifying emergency transportation, subject to the terms and limits of the policy.

Debbie's Travel Tip: When comparing policies, don't look only at trip cancellation coverage. Take a close look at emergency medical and medical evacuation coverage, too.

Those may be the benefits you're most grateful to have if something serious happens far from home.

🧲 What About Lost Luggage?

Travel insurance may include coverage for lost, damaged or delayed baggage and personal belongings.

But there are usually limits.

A policy may have:

  • A total baggage limit
  • Per-item limits
  • Different rules for high-value items
  • Requirements concerning documentation and receipts

Don't assume a $3,000 camera or expensive jewelry will automatically be fully covered because your policy says "baggage coverage."

⏰ Travel Delay Coverage

Stuck overnight because of a qualifying travel delay?

Some policies may reimburse certain expenses such as lodging, meals or transportation after you've met the policy's requirements.

Pay attention to the details.

For example, coverage may not begin until you've been delayed for a certain number of hours.

Save your receipts if you experience a significant travel disruption.

🩺 What About Pre-Existing Medical Conditions?

This is another area where the fine print matters.

Some travel insurance policies exclude losses related to pre-existing medical conditions.

Others may offer a pre-existing-condition waiver if certain requirements are met—often including purchasing insurance within a specified period after making your initial trip payment.

Definitions and requirements vary by policy.

If this issue matters to you or someone traveling with you, ask about it before purchasing the policy.

🤔 What Is "Cancel for Any Reason"?

You may see an optional benefit called Cancel for Any Reason, often shortened to CFAR.

It's more flexible than standard trip-cancellation coverage because cancellation doesn't have to be for one of the policy's usual covered reasons.

But there are catches.

CFAR generally costs more, usually must be purchased within a specified period, may require you to insure the full prepaid nonrefundable cost of your trip, and typically reimburses only a percentage of your loss rather than 100%.

It may also require cancellation a certain amount of time before departure.

"Cancel for Any Reason" doesn't mean cancel whenever you want and automatically get every dollar back.

💳 Does My Credit Card Already Cover Me?

Maybe—for some things.

Some credit cards include certain travel protections when you use the card to pay for eligible travel.

But coverage varies enormously.

Before relying on credit-card protection, find out exactly what's included, the coverage limits, exclusions and how a claim works.

A credit card with some travel benefits isn't necessarily a replacement for a comprehensive travel insurance policy.

💰 Should I Buy Travel Insurance?

There's no single answer that's right for everyone.

Think about:

  • How much money would I lose if I had to cancel?
  • Could I comfortably absorb that loss?
  • Does my regular health insurance cover me at my destination?
  • What would happen if I needed medical care overseas?
  • Do I have emergency medical evacuation coverage?
  • What protection do I already have through credit cards or other insurance?

Then compare policies based on what matters for your particular trip.

🔍 Don't Shop by Price Alone

The least expensive policy isn't necessarily the best value.

And the most expensive policy isn't automatically the best one either.

Compare:

  • Covered reasons for cancellation/interruption
  • Medical coverage
  • Medical evacuation coverage
  • Coverage limits
  • Deductibles
  • Pre-existing-condition provisions
  • Baggage benefits
  • Travel delay benefits
  • Exclusions
  • CFAR availability, if important to you
Debbie's Travel Tip: Don't just compare the price of travel insurance. Compare what you're actually getting for that price.

❤️ The Bottom Line

Travel insurance isn't about expecting something to go wrong.

It's about deciding how much financial risk you're comfortable taking if something does go wrong.

Ask questions. Read the policy. Understand the exclusions.

And make the decision that's right for you and your trip.

Then hopefully you'll never need to use it—which is exactly how we'd all like our vacations to go.