It’s worth considering travel insurance if you have high nonrefundable booking costs or plan to travel internationally, where your health insurance won’t cover you. However, travel insurance may not be necessary if trip costs are low or refundable, or if you don’t need additional coverage apart from your existing health insurance or credit card travel protections.
Learn more: Travel insurance: What it covers, costs, and how to choose the right policy
The more expensive nonrefundable trip costs you have, the greater the risk you take if you have to cancel or interrupt your trip for unforeseen reasons. With full coverage travel insurance policies, you’re typically covered for various trip cancellation reasons that are out of your control, such as you or a traveling companion becoming seriously ill or getting injured.
Your standard health insurance plan may not cover you if you travel abroad, so it may make sense to look into travel insurance policies with sufficient medical coverage. Also, a travel insurance policy with emergency evacuation and repatriation coverage could cover hundreds of thousands of dollars in expenses if you plan to travel to a remote destination or a destination with limited infrastructure.
Learn more: What does travel insurance cover, and do I need it?
If you go on multiple trips per year, it’s worth considering an annual travel insurance policy. The more you travel, the higher the chances of having a flight delayed or canceled, losing your luggage, or any other number of unforeseen circumstances.
Annual plans are often more cost-effective for frequent travelers than paying for individual plans per trip, but you may receive less coverage overall, depending on the policy.
Planning your travels well in advance isn’t a bad thing, but it does leave more time for an unexpected event to occur, which could force you to change your plans. Note that you can often make travel bookings and buy travel insurance later as long as you haven’t left for your trip yet. However, keep in mind that locking in your travel insurance policy early may open up the possibility for add-on coverage, such as insurance for preexisting medical conditions.
Making travel plans with tour groups or travel agencies can simplify the process, but it might also lock you into nonrefundable expenses. In addition, planning your own complex itinerary, with multiple flights and hotel stays, could get complicated if you have to cancel your trip.
With an adequate travel insurance policy, you wouldn’t have to worry as much about the cost of rescheduling or canceling part or all of your trip for covered reasons.
Learn more: What does travel insurance cost?
If your trips are often short, such as a quick weekend getaway, you may not need travel insurance because you’re likely to spend less money when you’re only gone for a few days.
If you always make sure your travel bookings are refundable or able to be changed without additional charges, there’s likely no need to purchase an insurance policy with trip cancellation coverage.
Many of the best travel credit cards provide various types of travel insurance coverage as part of their built-in benefits. For example, you may already have trip cancellation or interruption insurance (up to a certain limit) if you pay for your flights and hotel bookings with an applicable credit card.
Common types of travel insurance coverage:
Auto rental coverage
Baggage insurance
Emergency evacuation and transportation coverage
Emergency medical and dental coverage
Travel accident insurance
Travel delay coverage
Trip cancellation insurance
Trip interruption insurance
Note: The names of these coverages can vary by provider.
Common items typically not included in travel insurance plans include:
Preexisting medical conditions
Known or foreseeable events
Changing your mind.
Being afraid to travel
High-risk activities and adventure sports
Epidemics and pandemics
In some cases, basic travel insurance coverage may not be worthwhile because the coverage limits are too low, or not every situation is covered.
For instance, an Allianz basic annual plan may be less than a third of the price of the most expensive plan option, but you miss out on key protections like trip cancellation and interruption insurance. This means that if you have to cancel or interrupt your trip, the policy will not reimburse any applicable nonrefundable expenses.
CFAR coverage is mainly worth it if you want additional peace of mind to cancel a trip and recoup at least some of your nonrefundable expenses. This coverage lets you cancel your trip if you change your mind or basically for any other reason. However, you typically only get back 50% to 75% of your insured nonrefundable expenses.
Medical evacuation and transportation coverage
If you’re considering purchasing a plan with emergency medical and dental coverage, it may already include medical evacuation and transportation. If it doesn’t, it’s well worth considering, since emergency medical transportation costs can easily exceed $100,000.
However, if you don’t need additional medical insurance or don’t plan to travel internationally, this coverage may not be necessary.
Consider these questions to help you decide whether travel insurance makes sense for you:
Do you have nonrefundable trip expenses? If so, it may be worth considering trip cancellation and interruption insurance.
How far are you traveling from home? Emergency medical coverage may make sense for international trips.
Do you already have overlapping coverage? You may not need more coverage if you’re already covered through a rewards credit card.
How long is your trip? While travel insurance may make sense for a long trip, you may not need it for a quick weekend vacation.
Are you planning to rent a vehicle? A policy with rental car damage and theft coverage could be useful.
Will you be checking a bag? Baggage delay reimbursement or baggage loss and damage insurance can help protect your belongings.
Could you afford to absorb unexpected losses? This may be the most important question of all. If you can’t afford to absorb unexpected losses, it may be wise to consider purchasing a travel insurance policy.
It may be worth considering travel insurance if you have high nonrefundable expenses, are planning to travel internationally, or take multiple trips each year.
Travel insurance may be unnecessary if you have flexible travel bookings, travel for short periods at a time, or already have sufficient coverage through travel credit cards or another means.
If deciding whether travel insurance makes sense for you, consider your own risk tolerance. If you can’t afford to absorb the cost of unforeseen expenses, you may want to consider purchasing a travel insurance policy.
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