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How to Find the Best Travel Insurance

May 29, 2020
Insurance, Travel Insurance
How to Find the Best Travel Insurance
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Note: The coronavirus pandemic has disrupted existing and future travel plans, and turned greater attention to trip insurance. Read our take on specific information concerning travel insurance and COVID-19, or see our comprehensive guide to managing your finances during COVID-19.

Booking travel always carries some degree of uncertainty. Travel insurance provides a safety net so you can step out with confidence. Insurance is designed to cover the big financial risks you don’t want to bear alone. You may not need travel insurance for inexpensive trips, but it can provide a sense of security when you prepay for pricey reservations or plan a big trip abroad.

More Americans are buying trip insurance. Around 65.8 million people were covered by some type of travel policy in 2018, a 49% increase from 2016, according to the most recent data from the U.S. Travel Insurance Association.

There are many different policies available, and selecting the right plan depends on your particular circumstances. Follow along as we take a look at the most common travel insurance needs, determine what factors affect the cost, present different travel insurance options and show you how to get covered.

Common travel insurance needs

Depending on the type of coverage you’re looking for, the chart below will help you determine what to look for when selecting a policy:

If you want:Include this in your travel insurance policy:
Payment of medical expenses if you get sick or injured on a trip and need emergency care that’s not covered by your regular health insurance plan.Travel medical plan
To be taken to the nearest hospital or flown home if necessary when you're injured or you get sick on a trip.Emergency evacuation and repatriation
Reimbursement of nonrefundable reservations if you get sick and have to cancel or end a trip early; reimbursement if you incur extra costs (e.g., lodging) due to a delay by the airline or other carrier.Trip cancellation, interruption and delay
Reimbursement of nonrefundable reservations no matter why you cancel a trip.“Cancel for any reason” coverage
Payment for lost, stolen or damaged baggage.Baggage and personal belongings
Help finding a lawyer abroad.24-hour assistance
Payment for rental car damage.Car rental collision insurance

Depending on the policy, travel insurance reimburses you or offers services when something goes awry. There’s even coverage for the worst-case scenario: if you die in an accident while traveling. Accidental death coverage pays your beneficiary a lump sum in that case.

Before you buy, take a little time to get familiar with different types of travel insurance, how it’s priced, and what it covers and excludes. Usually, the more thorough the coverage, the more it will cost.

Factors affecting travel insurance cost

A comprehensive travel insurance plan typically will cost about 4% to 8% of the cost of a trip, according to the U.S. Travel Insurance Association. The price will vary depending on:

  • Length and cost of the trip: The longer and more expensive the trip, the higher the policy cost.
  • Cost of local health care: High health-care costs in your destination can drive up the price of trip insurance.
  • Medical conditions you want covered: Coverage for conditions you already have will increase the cost of travel insurance.
  • Amount and breadth of coverage: The more risks a policy covers, the more it will cost.
  • Your age: Generally the older you are, the higher the price.

Keep these factors in mind when considering different travel insurance options.

Different types of travel insurance

You’ll find a wide selection of trip insurance plans when you shop for a policy. Typically, travel insurance is sold as a package, known as a comprehensive plan, which includes a variety of coverage. Some insurers and comparison sites let you customize a policy by choosing types of coverage a la carte. For example, TravelInsurance.com is a comparison site that provides quotes from different providers.

Here are seven of the most common types of coverage:

1. Travel medical insurance

These plans provide health insurance while you’re away from home. Although in some ways these policies work like traditional health plans, generally you cannot use travel health insurance for routine medical events. For example, a routine medical checkup is usually not covered. In addition, these policies often include limitations on coverage and exclusions for pre-existing conditions.

Although most travel insurance plans cover many recreational activities, such as skiing and horseback riding, they often exclude adventure sports, such as skydiving or parasailing, or competition in organized sporting events. You may need to buy a special travel policy designed for adventure or competitive sports.

International travel insurance

Most likely, your U.S.-based medical insurance will not work while you’re traveling internationally, and Medicare does not provide any coverage once you leave the U.S. outside of a few very specific exemptions. If you plan on traveling abroad, purchasing travel medical insurance could make a lot of sense.

» Learn more: Travel medical insurance: emergency coverage while you travel internationally

2. Trip cancellation, interruption and delay

Trip cancellation insurance reimburses you for prepaid, nonrefundable expenses if the tour operator goes out of business or you have to cancel the trip for one of the reasons outlined in the policy, such as:

  • Your own illness
  • The illness or death of a family member who’s not traveling with you
  • Natural disasters

Trip interruption insurance covers the nonrefundable cost of the unused portion of the trip if it is interrupted due to a reason outlined in the policy.

Trip delay coverage reimburses you for expenses such as lodging and meals if you’re delayed during a trip (e.g., your flight gets canceled due to weather).

Many package policies cover all three. These policies are different from the cancellation waivers that cruise and tour operators offer, the Insurance Information Institute says. Waivers are cheap, ranging from $40 to $60, and often include restrictions. For example, according to the institute, waivers might not refund your money if you cancel immediately before departure. Waivers are technically not insurance policies.

Some companies offer additional layers of coverage at extra cost. “Cancel for any reason” coverage will reimburse a large part of the trip cost, no matter why you back out. And some companies let you pay extra to cover pre-existing conditions if you cancel for medical reasons.

» Learn more: What you need to know about Chase’s trip delay insurance

3. Baggage and personal belongings

This coverage reimburses you for baggage and personal belongings that are lost, stolen or damaged during the trip. Some plans also reimburse you for extra expenses if your baggage is delayed for more than a certain period, such as 12 hours.

Your renters or homeowners insurance may cover personal belongings while you are traveling. It’s best to review your homeowners insurance policy to determine the level of coverage it provides so you do not end up paying for a benefit you already have.

4. Emergency medical assistance, evacuation and repatriation

This coverage pays medical expenses if you get sick or injured on a trip. Medical evacuation coverage pays for transporting you to the nearest hospital, and medical repatriation pays for flying you to your home country.

5. 24-hour assistance

This service is included with many package plans. The insurer provides a 24-hour hotline that you can call when you need help, such as booking a flight after a missed connection, finding lost luggage, or locating a doctor or lawyer.

Most travel insurers cover a wide array of services, but the specific options vary. Some plans include concierge services, providing help with restaurant referrals, tee time reservations and more. Many services also offer information before the trip, such as required vaccinations. The only way to know what’s included is to read the policy.

» Learn more: Should you insure your cruise?

6. Accidental death and dismemberment insurance

This coverage pays a lump sum to your beneficiary, such as a family member, if you die in an accident while on the trip. Accidental death and dismemberment insurance policies also pay a portion of the sum to you if you lose a hand, foot, limb, eyesight, speech or hearing. Some plans apply only to accidental death in a plane.

» Learn more: NerdWallet’s guide to life insurance

7. Rental car coverage

This pays for repairing your rental car if it’s damaged in a wreck, by vandals or in a natural disaster. The coverage doesn’t include liability insurance, which pays for damage to other vehicles or for the medical treatment of others if you cause an accident and are held responsible.

Ask your car insurance company whether your policy will cover you when renting cars on the trip. U.S. car insurance policies generally don’t cover you when driving in other countries, except Canada.

Car insurance requirements are complex because they vary among countries. You can usually purchase liability insurance from the rental car company. Learn about car insurance requirements by searching for auto insurance by country on the U.S. Embassy website.

How to get travel insurance

When you’re considering travel insurance for an upcoming trip, you’ll be happy to know that some components of your trip may already be covered. For example, when you book a trip with your credit card, depending on the card you use, you may already receive trip cancellation and interruption coverage.

So when deciding on what level of coverage you need, check to see what you already get with your credit card. Then, decide what additional coverage you would like. Commonly, travel medical protection is not included with your credit card, so if you’re looking for more comprehensive coverage, it makes sense to purchase a general trip insurance policy.

Below, we include four ways to obtain travel insurance, along with the pros and cons of each option.

Source of insuranceProsCons
Credit card: Some credit cards offer trip cancellation and rental car insurance if you use the card to book the trip or the car. Most credit cards offer secondary car rental insurance, which pays for car damage not covered by your regular car insurance plan.Coverage is free.You can’t customize the insurance to meet your needs. Most credit cards offer secondary car rental insurance, which pays for the costs not covered by your regular car insurance plan.
Travel agent and travel reservation sites: You can buy travel insurance when you book your flight, hotel and car rental.Buying is as quick and easy as clicking “yes” when you book reservations.

Coverage is inexpensive.
You can’t customize the coverage.
Travel insurance company: You can buy directly from many companies on their websites.You can choose a policy that fits your needs.

Many travel insurer websites also offer information to help you understand the coverage.
You’ll need to go to multiple websites to compare coverage and pricing.
Travel insurance comparison sitesYou can choose a policy that fits your needs and compare policies and pricing in one place.Comparing multiple policies takes time.

» Learn more: Airline travel insurance vs. independent travel insurance: which is right for you?

How to buy travel insurance

Comparing travel insurance policies from different providers is your best bet for finding a policy customized to your needs and at the best price. We’ve compiled a list of travel insurance providers and comparison sites to help you shop for the best quote.

Travel insurance comparison sites

If you don’t know which provider to go with, it makes sense to browse a list of plans on a comparison site. These sites will often include plans from the best travel insurance companies along with customer reviews. Below, we’ve included five popular insurance comparison sites:

SquareMouth

  • Compare plans from more than 30 providers.
  • Over 24,000 customer reviews.
  • Under its Zero Complaint Guarantee, SquareMouth will remove a provider if any customer complaint isn’t resolved to its satisfaction.

TravelInsurance.com

  • Compare plans from 15 providers.
  • See good and poor customer ratings and reviews for each insurer when you receive quotes.
  • “Learning Center” includes travel insurance articles and travel tips, including important how-to information.

InsureMyTrip

  • Compare plans from more than two dozen providers.
  • More than 60,000 customer reviews.
  • “Anytime Advocates” help customers navigate the claim process and will work on behalf of the customer to help with appealing a denied claim.

Insubuy

  • Compare plans from 12 providers.
  • Search coverage by sporting activity, including ground, air and water sports.
  • Many types of plans available for students, visiting family members, new immigrants and more.

Aardvark Compare

  • Compare over 30 different insurance plans from six providers.
  • Over 4,900 customer reviews on Trustpilot, with 94% comprising of 5-star reviews.
  • Includes a “Travel Insurance 101” learning center to help customers understand various policies and benefits.

Compare travel insurance providers

If you already have an insurer in mind or just want to learn more about some of the best travel insurance companies, take a look at our top 10 list below. Whether you’re looking for an international travel insurance plan, emergency medical or a policy that includes extreme sports, these providers have you covered.

Allianz Global Assistance

  • Annual and single-trip plans.
  • Plans available for international and domestic trips.
  • Stand-alone rental-car damage product available.

Travel Guard by AIG

  • Four levels of comprehensive plans and a build-your-own customizable plan.
  • Flight accident insurance, medical evacuation plan and annual plans available.
  • Plan available for business travelers.

USI Affinity Travel Insurance Services

  • Search comprehensive plan types by policy name, insurance needs and traveler type.
  • Medical and evacuation plans for international travel.
  • Two annual plans to choose from.

Travel Insured International

  • Comprehensive and medical-only plans.
  • Flight plans include coverage for missed and canceled flights and lost or stolen baggage.

World Nomads

  • Comprehensive international travel insurance plans.
  • Coverage available for adventure activities, such as trekking, mountain biking and scuba diving.
  • Coverage for cameras, laptops and phones.

Berkshire Hathaway Travel Protection

  • Comprehensive plan offers cancellation, emergency medical coverage and emergency travel assistance.
  • Two of the plans offer compensation for missed connections and higher thresholds for lost baggage.

Travelex Insurance Services

  • Two comprehensive plans available.
  • Coverage can be customized.
  • Two flight insurance plans available.

Seven Corners

  • Comprehensive plans for U.S. and non-residents, including visitors and immigrants traveling to the U.S.
  • Annual, medical-only and student plans are available.
  • “Dogtag” plan for extreme sports, which comes with a wearable metal insurance ID tag.

IMG

  • Special medical insurance for ship captains and crew members, international students and missionaries.
  • Coverage for adventure travel.
  • Trip cancellation plans.

AXA Assistance USA

  • Three comprehensive plans available.
  • Optional benefits can be added to any plan, such as “cancel for any reason” and rental-car damage coverage.

4 tips for buying travel insurance

Keep these four important tips in mind when you’re considering a trip insurance policy.

  1. Evaluate the financial risks you face when traveling. Can you bear those costs yourself, or do you want insurance?
  2. Examine what coverage you already have: Does your credit card offer travel insurance? Do you have renters or homeowners insurance to cover belongings? What is the deductible? Will your health plan cover you in all the locations where you travel?
  3. Get quotes for trip insurance online. Choose a package of the benefits you need and compare prices for similar coverage among carriers.
  4. Narrow your choices and then read the policy details to understand what’s covered, what’s excluded and the limits on coverage. You may find that the lowest-priced policy is too restrictive and that paying a little more gets you the coverage you need. Or you might find that the cheapest, most basic policy fits the bill.

» Learn More: Comparing travel insurance options: airline or credit card?

The bottom line

Unpredictability is one of the mind-opening joys of travel, but travel insurance should contain no surprises. The time you spend to understand your options will be well worth the security you have as you embark on your next adventure.

Check out our additional resources on travel insurance:
9 credit cards that provide travel insurance
Your Guide to AmEx trip cancellation and travel insurance
Your guide to Chase Sapphire Reserve’s trip cancellation and travel insurance