What travel insurance covers (and what excludes)

  • Travel insurance aims to cover the risks and financial losses associated with travel.
  • Coverage can include flight cancellation, baggage protection, medical care and emergency evacuation.
  • While cash compensation is an essential benefit, travel insurance can also provide peace of mind.

Whether it’s a trip across the world or a trip across the state, getting travel insurance can provide great relief if things go wrong. Flight delays, baggage loss, illness, injuries, and other unexpected events can disrupt the best laid plans. With great disruption comes the possibility of unexpected 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 is a wide range of plans, but travel insurance usually includes several types of coverage.

says Angela Borden, travel insurance expert and product strategist at travel insurance company Seven Corners.

Travel insurance coverage usually includes non-refundable payments and other travel related expenses. While cash compensation is an essential perk, there is another valuable perk of travel insurance as well: it can provide peace of mind.

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What does travel insurance cover?

Your travel insurance plan (and its terms and conditions) will specify the exact details and specifics of what is covered. As with most other forms of insurance, the general rule is that the more you spend, the more coverage you will have.

“Travel insurance can be confusing, so it is best to look for a reputable company that specializes in travel insurance and has a long history of successfully helping travelers around the world,” Borden says.

Canceled and delayed flights

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

illness or injury

Usually, US health care plans are not accepted in other countries. So travel insurance with medical coverage can be especially useful when you are abroad. Medical coverage can also help locate doctors and health care facilities.

Emergency medical transport

Medical transportation coverage will pay for emergency evacuation expenses such as air transportation and medically prepared trips to the United States. These expenses can easily run into the tens of thousands of dollars. Some plans may transfer you to a hospital of choice for care.

Lost or delayed baggage

While most airlines will compensate passengers if baggage is lost or damaged through their fault, there may be restrictions. Travel insurance plans also usually cover stolen items, such as those stolen from a hotel room. However, most policies do not cover expensive jewelry, antiques, or heirlooms.

What does credit card travel insurance cover?

Big advantage over many Travel Rewards Credit Cards This is the included travel insurance coverage. Normally, you will need to use that specific card for the transaction (at least with a partial payment) in order to initiate the protection process.

Each card has specific rules about what exactly is covered. But one of the industry leaders is the $550-per-year Chase Sapphire Reserve credit card. This is a shot of What is covered With this specific card:

  • Baggage delay: Up to $100 a day is refunded for up to five days if the passenger carrier delays your baggage for more than six hours.
  • Lost and damaged baggage: Up to $3,000 per passenger per flight, but only up to $500 per passenger for jewelry and watches and up to $500 per passenger for cameras and other electronic equipment.
  • Flight delay compensation: Up to $500 per ticket if you are more than six hours late or need to stay overnight.
  • Trip cancellation and interruption protection: Up to $10,000 per person and $20,000 per flight for prepaid, non-refundable travel expenses.
  • Medical evacuation benefit: Up to $100,000 for necessary emergency evacuation and transportation when making a five- to 60-day trip and traveling more than 100 miles from home.
  • Travel Accident Insurance: Coverage for death resulting from accident or dismemberment of up to $100,000 (up to $1,000,000 for joint travel with carriers).
  • Emergency medical and dental benefits: Up to $2,500 in medical expenses (subject to a $50 deduction) when you take a trip arranged by a travel agency and travel more than 100 miles from home.
  • Car rental coverage: Initial theft or collision damage coverage of up to $75,000 on rentals of 31 days or less

While more protection is included with cards that carry an annual fee, even the Chase Freedom Flex with no annual fee, for example, 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 Cover and obtain coverage from a third party.

“Credit card coverage typically does not provide medical benefits for travel,” Borden says. “To protect if you get sick or injured while traveling, you will need a travel insurance plan with medical coverage.”

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

What is not covered by travel insurance?

Knowing what travel insurance does not cover is just as important as knowing what it does.

“Travelers should understand that travel insurance benefits only take effect if a covered cause occurs,” Borden says. Most standard travel insurance plans will not reimburse you for the following:

Cancel for any reason (CFAR)

Unless you specifically purchase travel insurance to cancel for any reason, your standard benefits will only take effect if they are for a covered event. For example, you will not be compensated just for changing your mind about taking a trip.

Forecast weather events

While sudden storms or unexpected weather events are usually covered by standard travel insurance plans, a predicted and named tornado, for example, will not.

Epidemics and epidemics

As COVID-19 has disrupted travel around the world, many travelers have 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, this is not always the case.

medical tourism

If you’ll be traveling internationally for a medical procedure or doctor’s visit, it likely won’t cover your travel insurance plan if something goes wrong.

Pre-existing conditions and pregnancy

People with certain pre-existing conditions, such as someone who has diabetes and needs more insulin, will not be covered by a plan. Additionally, pregnancy-related expenses will likely not be covered by most plans.

Extreme sports and activities

Accidents while participating in extreme sports such as skydiving and paragliding will not be covered in most plans. However, many plans offer the ability to upgrade to a higher priced version that covers these items.

bottom line

Purchasing travel insurance is relatively simple, and the Personal Finance Insider’s Guide to The best travel insurance companies Determines our top picks. Remember, read your policy and its details closely to make sure it includes the items you need to cover.

No one likes to think about how a trip might not go as planned even before they leave. However, in essence, travel insurance provides peace of mind during your trip. While the initial cost may seem significant, when compared to the potential expense of a canceled flight, emergency evacuation, or exorbitant medical bill, it’s a small price to pay in the grand scheme of things.

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