How To Buy Travel Insurance

Shawn Plummer

CEO, The Annuity Expert

Traveling can be an exhilarating experience, but it can also be unpredictable. To mitigate the risk of unexpected events while traveling, such as cancellations, lost baggage, and medical emergencies, purchasing travel insurance can offer peace of mind. However, choosing the right insurance policy can be challenging, with many available options. This guide will guide you through selecting and buying travel insurance, providing tips and insights to help you make an informed decision.

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Understanding Travel Insurance

Before purchasing travel insurance, it’s essential to understand what it is and what it covers. Travel insurance is a policy that can help protect you financially against unforeseen circumstances that may occur while traveling. For example, the policy may cover trip cancellation, lost or stolen luggage, medical expenses, and emergency medical transportation. Some policies may also offer coverage for adventure sports, pre-existing medical conditions, and even terrorism-related incidents.

What Does Travel Insurance Cover?

Travel insurance policies vary, but the most common types of coverage include the following:

  • Trip cancellation/interruption: Provides reimbursement for non-refundable trip expenses if the trip is canceled or cut short due to unforeseen circumstances such as illness, injury, or a natural disaster.
  • Medical expenses: This includes hospital stays, doctor visits, and emergency medical transportation if you become ill or injured while traveling.
  • Baggage loss/delay: Reimburse lost, stolen, or delayed luggage and personal belongings.
  • Travel delay: Covers additional expenses incurred due to travel delays, such as meals and accommodation.
  • Emergency evacuation: This covers the cost of emergency evacuation in case of a medical emergency or natural disaster.
  • Accidental death and dismemberment: Provides coverage in the event of accidental death or loss of limb during your trip.
Financially Protect Yourself Abroad With The Right Travel Insurance

What Does Travel Insurance Not Cover?

Travel insurance policies typically do not cover pre-existing medical conditions, self-inflicted injuries, or injuries sustained while participating in high-risk activities such as bungee jumping or skydiving. They may also exclude coverage for acts of war, terrorism, or civil unrest, which social security may not cover.

Choosing the Right Travel Insurance

Choosing the right policy can be overwhelming with so many travel insurance options. Here are some factors to consider when selecting a policy:

Trip Details

Your travel itinerary will play a significant role in determining the type of coverage you need. For example, if you’re taking a short domestic trip, you may only need a basic policy that covers trip cancellation and baggage loss. However, if you’re traveling abroad for an extended period or participating in adventure sports, you’ll need a more comprehensive policy that covers medical expenses and emergency evacuation.

Coverage Limits

When purchasing travel insurance, pay attention to the coverage limits. This is the maximum amount the insurance company will pay for a claim. Ensure the limits cover potential losses, such as trip cancellation or medical expenses. In addition, if you’re traveling with expensive equipment or valuables, check the policy’s coverage limits for personal belongings.


Like other types of insurance, travel insurance policies may have a deductible. However, you must pay the deductible before the insurance company begins covering expenses. A higher deductible can lower the cost of the policy but may also increase out-of-pocket expenses if you need to make a claim.

Reputation and Financial Stability of the Insurance Company

Before purchasing travel insurance, research the reputation and financial stability of the insurance company. Look for reviews and ratings from previous customers and check the company’s financial strength rating from independent rating agencies such as A.M. Best and Standard & Poor’s.

Factors to Consider Before Purchasing Travel Insurance:

Before purchasing travel insurance, it is essential to consider the following factors:

  • Your Travel Destination: Travel insurance policies can vary based on your destination. For example, if you are traveling to a country with a high risk of political instability, you may need a policy that includes political evacuation coverage.
  • Your Health: You may need to purchase a coverage policy if you have pre-existing medical conditions.
  • Your Travel Dates: If traveling during peak season, you may want to purchase travel insurance to protect yourself from unexpected events like flight cancellations or hotel overbooking.

When to Buy Travel Insurance for Domestic Travel

Purchasing travel insurance at least a few weeks before your departure date is usually recommended for domestic travel. This will give you enough time to review the policy details and make any necessary changes.

When to Buy Travel Insurance for International Travel

For international travel, it is recommended to purchase travel insurance as soon as you book your trip. This is because travel insurance policies can cover pre-trip events, such as cancellations due to illness, that may occur before your departure date.

Purchasing Travel Insurance

Can I Buy Travel Insurance After Booking?

Yes, you can usually buy travel insurance after booking your trip. However, if you wait too long, you may not be eligible for certain types of coverage, such as trip cancellation coverage.

When is the Best Time to Buy Travel Insurance?

The best time to buy travel insurance is usually soon after booking your trip. This will give you enough time to review the policy details and make any necessary changes. However, it is essential to note that some policies may have a specific time limit for purchasing coverage after booking your trip.

When is it Too Late to Buy Travel Insurance?

Purchasing travel insurance at least a few weeks before your departure date is generally recommended. However, some policies may allow you to purchase coverage up until the day of departure.

Where to Buy Travel Insurance

There are several options for purchasing travel insurance:

Online Travel Agencies

Online travel agencies such as Expedia, Travelocity, and offer travel insurance as an add-on to flight or hotel reservations. While convenient, these policies may not offer the same level of coverage as standalone travel insurance policies.

Insurance Companies

Insurance companies such as Allianz, AXA, and Travel Guard offer standalone travel insurance policies that provide comprehensive coverage. These policies can be purchased directly from the insurance company or a licensed agent.

Credit Cards

Some credit cards offer travel insurance as a complimentary benefit to cardholders. However, the coverage may be limited, and the cardholder may need to pay for the trip using a credit card to be eligible for coverage.

Tips for Buying Travel Insurance

Here are some tips to keep in mind when purchasing travel insurance:

Compare Policies

Compare policies from different insurance companies to find the best coverage and price for your needs. Consider the coverage limits, deductibles, and exclusions when comparing policies.

Read the Policy Details

Before purchasing travel insurance, read the policy details carefully to understand what is covered and what is not. Pay attention to the coverage limits, deductibles, and exclusions.

Consider Your Health and Activities

If you have pre-existing medical conditions or plan to participate in adventure sports, ensure the policy covers these situations. Some policies may exclude coverage for high-risk activities, while others may offer coverage at an additional cost.

Buy Early

Purchase travel insurance as soon as possible after booking your trip. Some policies may have time-sensitive coverage for events like trip cancellations or pre-existing medical conditions.

Next Steps

Travel insurance can provide peace of mind, but choosing the right policy for your needs is essential. When selecting a policy, consider your trip details, coverage limits, and deductibles. Then, read the policy details carefully and compare policies from different insurance companies. And remember, purchasing travel insurance early can help ensure you have adequate coverage in case of unforeseen events. With these tips, you can confidently travel knowing you have the correct travel insurance policy.

Buying Travel Insurance

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Frequently Asked Questions

Is it cheaper to buy travel insurance separately?

If you’re looking for particular optional perks, such as “Cancel For Any Reason,” buying separate policies can be a more economical option. This means individual travelers on the policy can pick and choose what they need without paying extra.

What are the two disadvantages of travel insurance?

Travel insurance can be pricey and might not always cover pre-existing conditions. Furthermore, even if you do buy an insurance plan for your travels, there’s a chance that the claim may still get rejected due to certain loopholes in the policy. Thus, two of the significant disadvantages of travel insurance are its cost and unpredictable coverage.

What percent of trip cost should travel insurance be?

Considering the potentially costly consequences of an emergency, purchasing travel insurance is well worth it. The average premium for its coverage usually ranges from 4-12% of your total trip cost*. So even if you’re unsure about getting a policy, think about this: spending less than 12% on travel insurance could save you tens of thousands compared to not having one!

What are the two basic types of travel insurance?

Vacation Plans give you the most comprehensive coverage, including trip cancellation. When people think of ‘travel insurance,’ they usually mean a Vacation Plan. Meanwhile, Travel Medical Plans offer medical protection when traveling overseas.

*Disclosure: Some of the links in this guide may be affiliate links. I may receive a commission at no cost to you if you purchase a policy. It helps us keep the lights on!

Shawn Plummer

CEO, The Annuity Expert

I’m a licensed financial professional focusing on annuities and insurance for more than a decade. My former role was training financial advisors, including for a Fortune Global 500 insurance company. I’ve been featured in Time Magazine, Yahoo! Finance, MSN, SmartAsset, Entrepreneur, Bloomberg, The Simple Dollar, U.S. News and World Report, and Women’s Health Magazine.

The Annuity Expert is an online insurance agency servicing consumers across the United States. My goal is to help you take the guesswork out of retirement planning or find the best insurance coverage at the cheapest rates for you. 

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