What is it
When we travel, there are various risks and losses that we may encounter. Travel insurance is a type of insurance that can help protect us from these risks and losses. It offers financial compensation and assistance depending on the type and level of coverage we choose. To get the most out of our travel insurance, we should purchase it within 15 days of making our first payment, as this maximizes our coverage period and benefits. This includes coverage for pre-existing medical conditions and the ability to cancel our trip for any reason. So, if you want to ensure a safe and secure travel experience, travel insurance is definitely something to consider.
Travel insurance coverage
Some of the coverages of travel insurance include:
- Trip cancellation or interruption: This covers you if you have to cancel or cut short your trip due to unforeseen events such as illness, injury, death, weather, terrorism, or other covered reasons. Therefore you get reimbursed for your prepaid and non-refundable trip expenses, such as flights, hotels, tours, etc.
- Emergency medical and dental: This covers you if you get sick or injured during your trip and need medical or dental treatment. You can get reimbursed for your medical expenses, such as hospital bills, doctor fees, prescriptions, etc. Some plans also include coverage for emergency medical evacuation, which transports you to the nearest appropriate facility or back home if necessary.
- Baggage and personal effects: This covers you if your baggage or personal belongings are lost, damaged, stolen, or delayed during your trip. You can get reimbursed for the cost of repairing or replacing your items, up to a certain limit. Some plans also include coverage for baggage delays. This coverage provides you with a daily allowance to buy essential items if your baggage is delayed for more than a specified period of time.
- Travel delay: This covers you if your trip is delayed due to covered reasons such as bad weather, mechanical breakdown, strike, etc. You can get reimbursed for your additional expenses, such as meals, accommodation, transportation, etc. But they give it up to a certain limit and after a specified waiting period.
- Accidental death and dismemberment: This covers you if you die or suffer a loss of limb, sight, speech, or hearing as a result of an accident during your trip. You or your beneficiary receive a lump sum payment, depending on the type and extent of your loss.
Best travel insurance companies
There are many travel insurance companies and plans available in the market. Each of Them has different features, benefits, exclusions, and prices(1). However, the best one for you may depend on your needs, budget, and preferences. According to a Forbes Advisor article, the average cost of travel insurance is 5% to 6% of the total cost of the trip. The cost of travel insurance is influenced by several factors such as the level of benefits provided by the plan, the total cost of the trip, and the age of the traveler. For instance, senior travelers pay a higher percentage of their trip cost, averaging 18% for 80-year-olds.
Different sources have ranked the top travel insurance companies based on several criteria like coverage, value, customer service, and claims process. For instance, Allianz is considered the best overall by Forbes Advisor, while World Nomads is recognized as the best for international travel by NerdWallet. Here’s a list of the best companies.
- Allianz Travel
- AXA Assistance USA
- Trip Mate
- World Nomads
- Travel Guard
Travel Insurance Benefits, Pros and Cons
Some of the pros and cons of travel insurance are:
- Reimburses you for your nonrefundable and prepaid trip expenses. It pays for anyone who cancels, interrupts or has to delay your trip for covered reasons, such as illness, injury, death, weather, terrorism, or other unforeseen events.
- Covers your medical and dental expenses. It pays for anyone who gets sick or injured during a trip and needs emergency care that is not covered by a regular health insurance plan. Some plans also include emergency medical evacuation and repatriation, which transports you to the nearest appropriate facility or back home if necessary.
- Protect your baggage and personal belongings. It pays if they are lost, damaged, stolen, or delayed during your trip. You can get reimbursed for the cost of repairing or replacing your items, up to a certain limit. Some plans also provide a daily allowance to buy essential items if your baggage is delayed for more than a specified period of time.
- Can offer you 24-hour assistance services, such as help finding a lawyer abroad, arranging alternative travel arrangements, contacting your family or friends, or providing travel advice and information.
- Travel insurance can give you peace of mind and confidence when you travel, as you know that you have a safety net in case something goes wrong.
- Does not cover every single part of your trip or every possible scenario. There are exclusions and limitations in every policy that you need to be aware of before buying. For example, some common exclusions are pre-existing medical conditions, reckless behavior, change of mind, war or civil unrest, nuclear radiation, etc.
- Can be expensive, especially for long trips, frequent travelers, or senior travelers. The cost of travel insurance depends on various factors, such as the destination, duration, age, health status, and coverage level of the traveler. You may end up paying more than what you would save in case of a claim.
- Travel insurance can be complicated and confusing to compare and buy. There are many different types of plans, benefits, options, and providers in the market. You need to do your research and read the fine print carefully before choosing a plan that suits your needs and budget.
- It can be difficult and time-consuming to claim. You need to provide proof of your loss or damage, such as receipts, invoices, medical reports, police reports, etc. You also need to follow the procedures and deadlines of your insurer. Some claims may be denied or disputed by the insurer for various reasons.