What Does Travel Insurance Cover?

Last updated: March 2022

Travel insurance helps reimburse you for nonrefundable payments and other costs related to your vacation if something goes wrong, like lost or stolen baggage, or unexpected medical expenses. It may also help reimburse you for trip cancelations, delays due to illness or bad weather conditions. To decide whether travel insurance is right for you, it's helpful to understand the types of coverage available in a policy. Most policies include the following types of coverage:

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Trip interruption coverage

Trip interruption can help reimburse you for certain expenses if your trip is cut short, according to the NAIC. These are typically prepaid and nonrefundable trip expenses. Interruption coverage may also be able to help pay for overnight hotel stays as a result of a trip interruption, depending on your policy. Covered reasons may include many of the same ones as trip interruption coverage—things like illness, severe weather, or if your travel company is having financial issues.

Missed connection coverage

If bad weather causes you to miss a connecting flight en route to your destination, you may be covered for expenses needed to catch up, such as additional transportation and meals. Check whether your plan has a limit on your reimbursements for missed connections and/or a minimum required delay.

Baggage coverage

There are two types of baggage coverage that may be available on a travel insurance policy:

Baggage loss/damage coverage
If your bags are lost or stolen, this coverage may help reimburse you for your personal items, like clothes, up to a certain maximum amount, says the III.

Baggage delay coverage
If your baggage is delayed or misdirected for 24 hours or more, this coverage may help reimburse you for the reasonable additional purchase of essential items during your trip.

Emergency medical coverage

Emergency medical coverage, sometimes referred to as travel health insurance, can help cover someone injured or ill during the trip.

The NAIC explains that travel health insurance may help pay for the following:

  • Medical and/or dental expenses due to a covered illness or injury requiring emergency treatment
  • Emergency transportation to the nearest medical facility because of a covered illness or injury.

If you slip and break your ankle while hiking in a remote area, travel health insurance may help cover the costs of being airlifted to the nearest hospital. Or, if you become seriously ill during your trip overseas, this coverage may help pay for the hospital stay.

Travel insurance deductibles and coverage limits

If you're thinking about purchasing travel insurance, it's important to understand that what your policy may help cover versus what you may have to pay for out of pocket. Ask your insurer about the following:

Deductible
Travel health coverage may come with a deductible—typically up to $1,000. As with any insurance policy, keep in mind that lower deductibles typically mean a higher premium.

Coverage limits
Make sure you know the limits of your travel health insurance coverage. Consumer Reports says some policies are capped at $10,000—if you need emergency medical care, you would be responsible for paying for any associated costs that exceed your limit.

Pre-existing conditions
You may want to ask the insurer about coverage for pre-existing conditions. According to the NAIC, some policies may not cover treatment for pre-existing conditions, or they may charge a higher premium. The NAIC also states that some insurers may charge more for coverage based on your age.

But knowing how travel insurance coverages work can help you make an informed decision when purchasing a policy. Also, no two travel insurance companies or policies are the same. When shopping for travel insurance, ask the insurer what kind of protections they offer and the limits of each. They'll likely be able to help you find protections fit for you and your wallet.