Travel Insurance Benefits: What to Know

Travel insurance is like having a personal safety net during your travels. It helps protect you against trip costs resulting from covered unexpected events, such as an illness or a canceled or interrupted trip.

Typical travel insurance benefits include coverage for emergency medical care, trip cancellation, lost luggage, and more. To make the most of your travel insurance benefits, it’s important to compare plans, understand the coverages you’re buying, and buy a plan well ahead of your travel dates.

Here’s what to know about travel insurance benefits.

Types of travel insurance benefits

Many companies offer travel insurance, and while policies can vary greatly, some travel insurance benefits are standard. Most travel insurance plans include coverage for certain events. For example, if you have to cancel your trip for a reason covered by your policy, your trip cancellation benefit would reimburse you for some — or all — of your costs.

Here are the different types of travel insurance benefits to look for.

Trip cancellation benefit

If you cancel your trip due to a covered reason, like an injury or illness that prevents you from traveling, this coverage will reimburse your pre-paid, non-refundable trip costs. These costs may include airfare, lodging costs, and more.1

The most popular type of travel insurance, trip cancellation coverage protects your investment in case of unforeseen events.

Cancel for any reason benefit

Also known as CFAR coverage, cancel for any reason coverage allows you to get reimbursed up to a certain percentage of your non-refundable travel costs, regardless of the reason for canceling. Although cancel for any reason coverage is usually more expensive, this benefit offers flexibility and peace of mind when plans change unexpectedly.2

You’ll typically need to meet specific requirements to be eligible to add CFAR coverage to your policy. And most companies apply a time limit for cancellation. For example, your policy might stipulate that you have to cancel your trip no later than 48 hours before your scheduled departure date.

Trip interruption benefit

While trip cancellation insurance kicks in if you never get to go on your trip, trip interruption coverage applies if you’re on your trip and have to return home early. This benefit provides coverage to reimburse your unused, non-refundable trip costs if you need to return home early due to a covered reason, like a death in the family.

It may also pay for your additional transportation costs to return home.

Trip delay benefit

Travel delays can be aggravating — and costly. For example, if your flight gets canceled and you’re rebooked on a flight for the next day, you may incur hotel costs for the night, airline change fees, and losses for tours you miss due to the delay.

Trip delay coverage can pay for delay-driven expenses, like meals, accommodations, and local transportation during the delay. It can help get you through unexpected pauses in your travel plans.

Baggage and personal effects benefits

If your baggage or belongings are lost, stolen, or damaged while you’re traveling, this benefit can reimburse you for some of your costs, up to the maximum amount your policy allows. Baggage reimbursement can come in handy when you need to replace essential items while traveling.

Baggage delay benefits

A baggage delay can cause significant inconvenience, even if your luggage eventually arrives. Baggage delay coverage reimburses expenses (up to a specified amount per day) for essential items like clothing and toiletries.

Most policies stipulate a minimum amount of time for the delay before this coverage kicks in.

Emergency evacuation and repatriation of remains

If you experience an urgent injury or illness that your insurance covers, this benefit pays the cost of transporting you to the nearest medical facility or home.3 Working with the travel medical coverage part of your policy, emergency evacuation helps ensure you get the medical attention you need.

Travel medical expense benefits

Most U.S. health insurance, including Medicare, doesn’t cover medical care outside the country.4 Travel medical insurance covers the cost of medical emergencies that occur during your trip. It provides access to necessary medical care without you having to worry about the unexpected costs.

Travel medical insurance policies can vary greatly, so it’s important to know what yours will and won’t cover. For example, a policy might exclude coverage for a pre-existing condition, have a limit to the payout amount, or have a deductible.

Pet medical and pet return benefits

Many people enjoy traveling with their pets, and plenty of hotels and resorts now cater to people and their pets. Pet medical insurance provides coverage for your pet’s unexpected medical costs if it falls sick or gets injured while traveling with you.5 Pet return coverage can help pay to get your pet back home if a covered event causes you to discontinue your travels.

Not every travel insurance policy includes these coverages, although they might be available as an add-on. And, like other aspects of a travel insurance policy, pet coverage has certain eligibility requirements and limitations.

Vacation rental damage

Accidents can happen when you rent a property for your vacation. This coverage can help pay for accidental losses and damages to your vacation rental property that occur during your stay.

Rental vehicle damage

If you rent a vehicle for a domestic trip and have full-coverage car insurance on your personal vehicle, your policy will probably cover your rental car, too. But if you rent a vehicle outside the country, your personal auto insurance may not apply.

In that case, rental vehicle damage insurance can cover costs if your rental car gets damaged or stolen during your trip. This coverage provides important financial protection when you rent a vehicle outside the country.

Types of travel insurance plans

Travel insurance plans generally fall into three categories: coverage for a single trip, insurance for multiple trips, and policies that cover all your travel during a 12-month period. Here’s some essential information to know about each type.

Single-trip travel insurance

As the name suggests, single-trip travel insurance provides coverage for just one trip. Many travel insurance companies provide customizable single-trip policies. If you have just one trip planned in a year, a single-trip policy can help protect your financial investment.

Multi-trip travel insurance

A multi-trip travel insurance policy secures multiple trips within a year and provides comprehensive travel coverage. If you’re a frequent traveler with more than one trip planned in a year, a multi-trip policy can be a cost-effective way to get medical coverage, trip delay protection, and more.

Annual travel insurance

True globetrotters and spur-of-the-moment travelers can benefit from an annual travel insurance policy. An annual policy provides extensive travel insurance coverage for every trip you take in an entire year. It provides continuous coverage for unexpected medical costs, cancellations, and more.

How much does travel insurance cost?

Travel insurance premiums are typically a percentage of the total trip cost — usually 4%–10%. For example, a policy that includes basic coverage for a $10,000 trip might cost $400, while a more comprehensive policy might cost as much as $1,000.

Your costs for travel insurance will vary based on a number of factors, including where you’re traveling to, the total trip cost, your age, your overall health, the types of coverages you choose, coverage limits, and more.

How to buy travel insurance

You have many options for buying travel insurance — you can choose from nationally recognized insurers that sell auto or home insurance, companies that specialize in travel insurance, and even some credit card companies. Generally, you’ll need to buy a policy around the time you make the first payment on your trip.

To find the travel insurance policy that’s right for you, follow these steps: