You may not need travel insurance as much as you think. Other types of insurance, such as homeowner’s insurance and health insurance, can cover many of the typical problems that arise on trips. Travel insurance serves the relatively limited purpose of providing reimbursement for trips that are canceled or interrupted. It also may be useful in circumstances in which health insurance does not cover a traveler in another country.
Canceling a Trip
Certain expenses related to travel are non-refundable, including many airline tickets. Also, you may need to put down a deposit for a hotel room, which you will lose if the trip is canceled on short notice. If you need to cancel a trip because of an accident or illness, or another event covered by the policy, travel insurance can reimburse you. The accident or illness must be unforeseen, so ongoing or chronic conditions may not be covered. A policy can apply not only to accidents or illnesses affecting the traveler but also to accidents or illnesses affecting a traveling companion or a close family member. The definition of a close family member can vary across different policies.
Certain reasons for cancelation will be excluded under a policy’s terms. These often include pre-existing medical conditions, accidents that occur during risky activities, or violence or war in the country to which you are traveling. You should carefully read the policy to make sure that you are familiar with the exclusions.
This type of insurance only covers you before your trip starts. Determining when your trip starts can be challenging. You may want to get a policy that covers you until you leave the country so that accidents or illnesses that arise while traveling from your home to your departure point will trigger the coverage.
Interrupting a Trip
When trip cancelation insurance ends, trip interruption insurance starts. This offers reimbursement for any losses resulting from ending a trip early. In other words, trip interruption insurance may pay for your return trip home, and it may cover money that you prepaid for trip activities in which you will not participate. If the interruption to your trip causes additional living expenses, these may be covered as well.
Sometimes a traveler will need to pause during their trip because of an accident or illness, and then they will want to catch up to their schedule later in the trip. Trip interruption insurance might cover the cost of getting to the appropriate place at a later time, such as airline change fees.
For injuries other than a pre-existing condition, medical evacuation insurance may cover medical transportation costs while you are traveling. If you break your leg while you are climbing a mountain in the Pyrenees, for example, it might pay for your flight to a hospital for emergency treatment. It also might apply to situations in which you need to leave a foreign country prematurely because of war or terrorism. If you die while you are traveling, this coverage might account for the cost of bringing your body home for burial. However, trip interruption insurance might also cover these costs, depending on the policy.