Summer travel season is here, but while you’re dreaming of sunny beach locales and foreign destinations, it’s also smart to think about how you’ll protect those plans—and your wallet. And that’s where travel insurance comes in. If you’ve booked a trip online in the last few years, you’ve likely seen a prompt asking you to purchase it. But is it worth it? Well, the answer depends on where you’re going, whether your trip is refundable, and other factors (like how much coverage you get from your credit card).
What Is Travel Insurance?
Travel insurance is a financial safety net that helps protect you from unexpected costs and disruptions while traveling. Depending on the policy, it can cover things like trip cancellations, medical emergencies, lost baggage, or even travel delays. Travel insurance is typically offered through travel agencies, airlines, credit card companies, or independent insurance providers. It can be purchased when booking your trip or separately through an insurer.
Types of Travel Insurance
Not all insurance has your back in the same way. So, it’s important to read the fine print and understand what each policy actually covers before you buy. Here are the most common types of coverage:
- Trip Cancellation or Interruption Insurance: Reimburses you if you have to cancel or cut your trip short for an eligible reason, like illness, a family emergency, or severe weather.
- Travel Medical Insurance: Covers medical expenses if you get sick or injured while traveling—especially important if you’re going abroad, where your regular health insurance may not apply.
- Emergency Evacuation Insurance: Pays for transportation to a medical facility or back home if there’s an emergency (like a natural disaster or political unrest).
- Baggage and Personal Belongings Insurance: Reimburses you for lost, stolen, or damaged luggage and items.
- Travel Delay Insurance: Covers costs like meals, lodging, or rebooking fees if your trip is delayed.
- “Cancel For Any Reason” (CFAR) Insurance: A pricier add-on that lets you cancel your trip for any reason—not just the reasons covered by standard policies.
Is Travel Insurance Worth It?
Whether travel insurance is worth it depends on a few key factors, most importantly: how much you’re willing to risk. If losing your investment in the trip stresses you out, insurance might give you peace of mind. These are other key factors to consider:
- The Cost and Length of Your Trip. The more expensive or complex your travel plans are, the more valuable insurance becomes. Longer trips may increase the chance of cancellations, interruptions, or medical emergencies.
- Your Destination. Heading to the Caribbean during hurricane season? Visiting Antarctica? You might want to research viable policies. Traveling to regions with unpredictable weather, political unrest, or health risks makes insurance a smart investment, but some policies won’t apply.
- Planned Activities. Gonna do some skydiving on your trip? Hiking the Pacific Crest Trail? Look for policies that cover adventure sports and other risky activities. Many standard policies won’t.
- Your Health and Age. Older travelers or those with pre-existing conditions may benefit from additional medical coverage.
- Health Coverage. Traveling abroad? Many U.S. health insurance plans don’t include medical care in foreign countries. Travel insurance can fill that gap. Just keep in mind that traveling to regions with health risks or to remote locations may require extra coverage or special waivers.
- Credit Card Coverage. Some credit cards offer limited travel insurance if you use them to book your trip. Review your card’s benefits before buying a separate policy.
- Cancellation Flexibility. Many airlines, tour companies, and hotels offer free changes or cancellations up to 24 hours before your trip, but if you’re booking non-refundable components, insurance is a smart safety net.
When It’s Okay to Skip Travel Insurance
You might not need travel insurance if you’re taking a low-cost trip, staying close to home, or simply willing to take on the financial risk yourself. Many domestic flights now offer flexible change or cancellation policies, and even budget hotels often have refundable rates (or are so inexpensive that the cost of insurance may not be justified).
Before your trip, check to see if your existing health insurance covers emergencies within the United States. Review your credit card policies to see if they include travel protections. You may already have a safety net in place—just be sure to read the fine print. If you’re comfortable covering the unexpected costs out of pocket, skipping the insurance could be a reasonable choice.
Want more travel tips?
- Check out our 12 money-saving travel tips.
- Discover some budget hacks for summer fun.
- Learn how to spot (and avoid) vacation rental scams.