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Even before the COVID-19 pandemic complicated our vacation plans, traveling during the holiday season was stressful enough. There were often flight delays, cancellations and bad weather. Now, travelers also need to worry about mandatory quarantines and border closures.
If you plan to travel during the holiday season, give yourself a new type of gift — travel insurance. A travel insurance policy will offer some peace of mind in case you run into any of these frustrations.
5 reasons you might want travel insurance this holiday season
Being flexible is one thing, but having to book a last-minute, expensive flight and pay for it out-of-pocket is another. Here are other reasons to think harder about the benefits of travel insurance:
1. Testing positive for COVID and having to quarantine unexpectedly
If you travel abroad during the pandemic, having to take a COVID-19 test before flying home is a standard practice right now. But what if you test positive for COVID-19 the day before your return flight to the U.S. and are now required to quarantine in the country you’ve been vacationing in?
The cost of the extra hotel nights, food and additional tests can quickly add up.
To make sure that these unfortunate unexpected expenses are covered, choose a travel insurance policy that provides COVID-related coverage.
» Learn more: Will my travel insurance cover coronavirus?
2. Trip changes or cancellations
Comprehensive travel insurance plans include trip cancellation coverage, which means that you'll be reimbursed for nonrefundable trip plans if your trip is canceled for a covered reason. Examples of covered reasons include a natural disaster (like a storm that’s about to hit your destination) or an illness that prevents you from traveling.
However, two reasons that aren’t covered are fear of travel and border closures in the country you plan on visiting. If either of these reasons are a concern for you, consider purchasing a Cancel For Any Reason plan, an often more expensive optional add-on with more coverage.
Cancel For Any Reason will allow you to cancel a trip for any reason whatsoever and get up to 75% of your nonrefundable deposit back as long as the trip is canceled at least two days in advance.
3. Flight delays
Flight delays are extremely frustrating because you could be sitting at the airport, waiting hours for the next flight and fighting others in the terminal for the last charging station outlet. During the holiday season, flights are more likely to be sold out; in some cases, you may be stuck waiting until the following day for a new flight.
Enter trip delay insurance. This benefit exists to help you in case of unexpected interruptions in your travel plans. Trip delay insurance can cover things such as lost prepaid expenses or additional costs incurred due to the delay. To be covered under this benefit, the delay must last the minimum time stated in your travel insurance plan.
For example, let’s say you purchase a travel insurance policy that covers six-hour delays. You are scheduled on a 5 p.m. flight to Los Angeles, and your flight is delayed due to mechanical problems. The next flight doesn’t leave until the following morning, so the delay is longer than six hours. Trip delay insurance may reimburse you for things like:
Overnight hotel accommodations near the airport.
Transportation to and from your hotel.
Dinner and breakfast.
Hotel charges for the first night in Los Angeles (if the hotel is unwilling to issue a refund).
Trip delay insurance is an important benefit to have because you can't expect an airline to provide this coverage. According to the U.S. Department of Transportation, if your flight is delayed, there are no federal laws requiring airlines to provide passengers with money or any other compensation.
4. Health issues during your trip
Imagine you’re enjoying yourself on vacation in Europe in the winter, and while you’re walking on an icy road, you slip and fall. You visit a doctor and find out you’ve sprained your ankle. The doctor advises you to stay off your feet, which is a huge disappointment because your trip was supposed to be a ski vacation — so you can't continue your trip.
Due to the doctor’s advice, you decide to fly home. If you have travel insurance, not only will the emergency medical benefit reimburse you for the doctor visit, but you will also get reimbursed for the unused portion of your hotel stay and new flight to return home.
If you didn’t have travel insurance, you’d be on the hook for potentially high medical bills and losing out on your prepaid hotel costs, as well as booking new airline tickets at the last minute.
5. Delayed or lost luggage
Delayed or lost luggage can be a huge annoyance, full stop. But travel insurance can help lessen the sting.
Let’s say you live in Florida and you’ve decided to go to Paris for New Year's. You’ve packed plenty of warm clothes, but when you arrive at baggage claim, your luggage is nowhere to be found. You file a claim with the airline and wait for a resolution.
If your luggage is officially considered lost, the baggage and personal item loss protections will apply. The amount and length of delay varies based on policy, but the benefit may include a per-item, per-person amount and a specific item limit for expensive pieces.
For example, the Berkshire Hathaway Travel Protection LuxuryCare plan provides baggage delay benefits of $200 per person after a 12-hour delay. This benefit will reimburse you for purchasing clothing, toiletries and other essential items. Although this amount may not be enough to cover the contents of your luggage, especially if you had winter clothes and shoes, you can at least purchase some basic necessities while you wait.
Under the same plan, if your luggage is deemed lost, you’ll be eligible for an additional $2,500 per person to cover the replacement cost of your luggage and personal effects.
» Learn more: Baggage insurance explained
Ways to get travel insurance
If you have a premium travel credit card, you may already have free travel insurance benefits provided. However, these benefits usually don’t include emergency medical coverage and also have lower limits than those provided by comprehensive travel insurance policies.
Otherwise, you’ll want to search for comprehensive travel insurance policies that offer the type of coverage you want.
A smart gift to yourself for the holidays
There's a ton of lists of what holiday gifts to get travelers. If you consider yourself a traveler, travel insurance is one of the best ways to stave off the stress. Your coverage can come from your travel credit card or through a comprehensive travel insurance policy. Either way, having a travel insurance policy will ensure you’ll get reimbursed in case something goes awry during your holiday travel.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2023, including those best for:
Flexibility, point transfers and a large bonus: Chase Sapphire Preferred® Card
No annual fee: Bank of America® Travel Rewards credit card
Flat-rate travel rewards: Capital One Venture Rewards Credit Card
Bonus travel rewards and high-end perks: Chase Sapphire Reserve®
Luxury perks: The Platinum Card® from American Express
Business travelers: Ink Business Preferred® Credit Card