Do I need travel insurance for my vacation?

Parents and their two kids walk through the water enjoying a vacation on a tropical beach.

Vacations are a time to get away from the routine, relax and experience new places. That doesn’t mean that vacations are always worry-free. Anything from severe weather to a family emergency can turn a long-awaited vacation that you spent weeks and months planning and saving for into a complex and expensive nightmare.

Travel insurance is a product you might want to consider, especially under certain circumstances. Similar to other forms of insurance, travel insurance provides a safety net against a potential loss. You pay a premium to a company that sells travel insurance who in turns agrees to pay a claim if something goes wrong and interrupts travel plans.

What does travel insurance cover?

Most travel insurance policies cover the following situations, which are often bundled together as a comprehensive policy:

  • Reimbursement for trip cancellation, interruption, or delay
  • Medical insurance and/or medical evacuation
  • 24-hour assistance in the case of an emergency

What are the best questions to ask when buying travel insurance?

When planning a vacation, below are the best questions to ask when purchasing travel insurance.

  • What is the likelihood that the region you are traveling to could experience an extreme weather event?
  • Are you taking a big trip for which you have made a significant monetary investment?
  • Is there a chance for political unrest at the location where you are visiting?
  • If someone in your traveling party experiences a serious health issue, would care be available?
  • Do you have any existing health conditions that have the potential to cut your trip short?
  • Can you absorb the financial setback of cancelling nonrefundable elements of your trip at the last minute?
  • If you need to return home suddenly, can you afford the cost of last-minute airfare?
  • Are you planning on engaging in any sporting activities while on vacation?

Have the answers to the questions listed above in mind when you look into travel insurance. Some policies won’t cover cancellations due to terrorism or civil unrest, so it is important to know and understand the risks before the trip. Other policies might exclude health issues that arise from pre-existing conditions, so if a traveling party member has a chronic condition this is an important question to ask. If the trip involves high-risk sporting activities like backcountry skiing or swimming with sharks in a cage, investigate if that activity is excluded from coverage.

Booking a vacation through a tour operator or a cruise line will entail reviewing the company’s specific cancellation policies carefully before investigating travel insurance. Then, make sure to ask if the travel insurance provides reimbursement if the tour operator or cruise line goes out of business. Some travel insurance policies cover this circumstance, but others do not.

What are cancellation waivers?

It is important to note that a cancellation waiver is not travel insurance. Cancellation waivers do provide some protection against losing all of your money if you have to cancel a trip, but they often come with numerous restrictions. In some cases, a cancellation waiver might be sufficient for your situation—but check the fine print carefully. For instance, if the cancellation waiver states that if the trip is cancelled within two weeks of a scheduled trip, they won’t refund your money, but will allow you to use it as payment for a trip within the calendar year. Will that work for you?

Much of your protection rests with being an empowered consumer. Investigate all of your options, including talking to your credit card company, health insurer, and homeowners insurance carrier to understand what they do and do not cover while you are on vacation. There are many different types of travel insurance policies that cover a wide range of potential issues, so take the time to look into them to protect the funds you’ve invested in your trip.

The content on this site is offered only as a public service to the web community and does not constitute solicitation or provision of legal advice. This site should not be used as a substitute for obtaining legal advice from an insurance company or an attorney licensed or authorized to practice in your jurisdiction. You should always consult a suitably qualified attorney regarding any specific legal problem or matter. The comments and opinions expressed on this site are of the individual author and may not reflect the opinions of the insurance company or any individual attorney.

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