Is Travel Insurance Worth It?

“Is travel insurance worth it?” is a commonly asked question around this time of year, and it’s worth considering as you’re planning that upcoming trip to visit your in-laws. Now that you’ve created an itinerary and researched the best prices, the last thing to think about when booking tickets is whether to add on travel insurance. To simplify the decision-making process, we’ve compiled a list of all the times you should absolutely buy travel insurance — and when you’re better off skipping the expense.

There are two main types of travel insurance: basic and comprehensive coverage. As the name implies, a basic plan covers the bare minimum. Lost baggage fees, reimbursements for missed flights, and refunds for when you can’t travel due to illness are typically covered under this type of insurance. Comprehensive coverage will usually include all of the aforementioned benefits, plus the costs of medical emergencies, disaster evacuations, and even fees related to accidental deaths.

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The price of travel insurance will vary by company and what’s covered under each plan, but according to ValuePenguin, a finance research site, the average cost of a basic plan is $105 compared to $164 for comprehensive coverage. It’s up to you to decide which protection plan works best, but many experts will recommend shelling out extra for the comprehensive package.

When Travel Insurance Is Worth It

International Travel: Imagine being stranded in another country because a family member misplaced his or her passport. You most likely won’t be making that return flight, which means coughing up extra for another ticket. Wouldn’t it be nice to have insurance so you can eat least be reimbursed for these unexpected expenses? With the security of knowing your trip is insured, you might even be able to look past this series of unfortunate events and enjoy your extended vacay.
Medical Coverage: Depending on what your health insurance plan will cover, it’s not a bad idea to get supplemental coverage through travel insurance. If you wind up getting hurt or sick in a big city overseas, there’s a good chance your health insurance will cover the costs, but if your medical issues require an extended stay, you could rack up quite a bill.
Cruises: As fun as an all-inclusive cruise to the Bahamas may be, it comes with a lot of risk: international travel, a large upfront payment, and a longer time window for problems to arise. Fortunately, there’s travel insurance, which you can buy through the cruise company or a third party. Hurricane season is a great time to score amazing deals on cruises, but you’ll want to buy insurance, too, in case the rains affect your plans.

When Travel Insurance Isn’t Worth It

Domestic Travel: If the extended family members you’re visiting still live in the US, save a few bucks and skip the travel insurance. Domestic travel tends to be shorter and cheaper, and your health insurance will work here even if you’re in a different state.
If Your Credit Card Offers It: Some credit card companies offer travel insurance up to a certain amount as one of its perks. For example, the Chase Sapphire Preferred will reimburse you up to $10,000 for travel expenses. Sounds like it may be time to reread the fine print!
For Flights: Airlines are typically required to put you on another flight if your trip is canceled. Depending on how long it will take the airline to rebook your flight, you may be entitled to compensation — no insurance necessary. Plus, having flight insurance won’t help you book a new flight any faster.
If You’re Just Looking for Flexibility: It’s tempting to buy travel insurance “just in case,” but you’re better off spending your money elsewhere. If you want the peace of mind that comes with knowing you can cancel your bookings last-minute and still be reimbursed, choose a hotel reservation package that lets you cancel up to the day of arrival. This way, you’re not throwing money away on a comprehensive insurance plan when all you need is a flexible hotel booking.