Whether the purpose of your trip is for business or pleasure, you invest a lot of time and money into your travel plans. So much forethought goes into booking, planning and laying out the details of your flight arrangements, your passport and other documents. Not to mention the time and attention that goes into deciding what to wear and what to bring.
Once you've booked your flight, arranged lodging and finalized activities on your itinerary, however, there's still one more step to take: purchase a trip insurance policy for yourself and encourage your travel companions to do the same.
Trip insurance can reimburse you for certain covered reasons, like flight cancellation or lost baggage. But that's just the start of what trip insurance can do for you.
Let's take a look at a few of the situations in which this coverage is especially beneficial and why it's a sound investment.
Trip Insurance Explained
First, let's lay the groundwork with a definition: Trip insurance safeguards your investment. This includes pre-paid travel expenses like the cost of your flight, your hotel room or accommodations, rental car costs and other similar arrangements. If an airline issue results in flight cancellation, trip insurance can reimburse you.
Trip insurance covers the following situations:
- A last-minute cancellation or delay
- Lost or stolen baggage or passport
- Inclement weather
- A sudden illness or death in the family
If one of these issues comes up while your trip insurance policy is active, it can help you recoup financial losses.
Benefits of Trip Insurance
When it comes to choosing your trip insurance coverage options, there are a few different types of trip insurance to consider, and each comes with its own benefits.
Trip Cancellation Insurance
This insurance will help prevent certain financial losses if your trip's cancelled for unforeseen yet covered reasons. This can include situations like you or your spouse falling too ill to travel, the death of a travel companion or family member, damage to your home due to a natural disaster, job termination, or inclement and unsafe weather.
Cancel For Any Reason (CFAR) Insurance
While basic trip cancellation benefits will cover financial loss due to a limited number of covered reasons, like those mentioned above, a Cancel For Any Reason insurance plan is a bit more flexible. This benefit is added to basic trip insurance to cover expenses and certain nonrefundable trip deposits if you have to cancel your trip plans for literally any reason.
Trip Delay Insurance
Whether a traffic accident prevents you from getting somewhere on time, or your airline delays the flight, trip delay insurance can help reimburse extra costs caused by a delay, such as food and accommodations. This plan will go into effect once travel arrangements are delayed for more than a certain number of hours, stipulated within the plan (typically twelve hours).
Emergency Medical Coverage
Trip insurance can help cover medical expenses associated with emergency situations during your travels. For example, if you are severely ill or injured abroad where your home country health insurance wouldn't cover you, trip insurance can help offer coverage for your medical expenses to protect you from financial strain.
The Hidden Benefits
Most trip insurance plans offer benefits that often go unnoticed until you have the chance to add them to your policy. Depending on your personal situation, they are a nice-to-have when things take an abrupt turn. Trip insurance policies typically offer the following benefits:
- Rental car damage
- Accident and sickness
- Natural disaster evacuation
- Travel assistance services
- Pet benefits
- And more..
Why You Need Trip Insurance: Examples
Trip insurance is a smart investment, particularly when you find the plan that is best suited to your travel endeavors. Here's a look at some real-world scenarios where trip insurance saves the day.
A Family Trip Is Impacted by Illness
You and your family are gearing up for your yearly vacation. You found the perfect destination for family fun in the sun, you and your spouse have put together a detailed and adventurous itinerary and you're counting down the days until your departure.
However, just a day before you're set to leave, your child falls ill and is unable to travel. Instead of losing out on the costs and investments you've already made, or electing to stay home with your sick little one as your spouse travels solo, you can count on your trip cancellation insurance to protect you financially.
A Business Trip Saved After Lost Baggage
You're traveling for a business trip and prepping for a big meeting during your flight. You arrive at your destination only to find that your baggage got lost along the way and you are now without your favorite power suit. But you thought ahead and purchased trip insurance. Costs associated with lost baggage can be reimbursed. Crisis averted.
The latter is certainly the better choice, but buying a new suit (and replacing everything else that was lost with your bag) can get pretty expensive. Since you purchased a trip insurance policy, though, you're in luck. You can confidently purchase the clothes and materials you need for your meeting and get reimbursed for these costs through your trip insurance coverage.
Leisure Travel Supported by Cancel For Any Reason Insurance
You and your significant other are preparing for a romantic getaway, just the two of you. You can't wait for the trip and are eagerly packing your bags, when news of a bird flu outbreak at your destination puts you into a panic.
Luckily, you have trip insurance with Cancel For Any Reason. Not only can you recoup some of your prepaid expenses, but also you and your partner don't have to put your health at risk.
A Frequent Traveler Saves Time While Ensuring Trip Coverage
Even the savviest travelers run into obstacles. In these cases, it's important to have trip insurance you can count on.
So, say you're a traveler with family overseas, and you take frequent trips to visit them. You invest in a multi-trip insurance plan that provides you with coverage for trips lasting a month or longer. This way, even if you fall ill or become injured, your plan ensures you can cancel your plans or access the medical services you need.
Secure Your Travel Expenses With Trip Insurance
No matter what type of trip you take or how often you travel, it's important to protect yourself with trip insurance. To find out more about what you need for your next adventure, connect with our Customer Success Team for help.
Frequently Asked Questions (FAQs)
Can I get trip insurance if I am flying domestically?
Yes, trip insurance plans offer coverage for U.S. residents traveling domestically or internationally, and non-U.S. residents traveling to the U.S. While flights domestically are generally cheaper than international flights, it is still recommended to get that additional coverage with trip insurance. It gives a greater peace of mind knowing that you can still get coverage for trip delays, interruptions, cancellations, and more benefits, as well as recoup the majority of your money with trip coverage instead of taking a financial loss.
What is considered a covered reason for trip cancellation?
A covered reason for trip cancellation insurance can be defined differently from plan to plan. That being said, it is important to read the policy details before purchasing a trip insurance plan. Generally speaking a covered reason for trip cancellation can be considered as the following:
- Family or travel companion illness or death
- Damage to your house due to a natural disaster, such as a flood, fire or earthquake
- Complete cessation of travel services due to strike
- Terror strike in your destination country
- You or your companion are affected by a job termination or a layoff
- Inclement weather
- You or your travel companion becomes pregnant and is not allowed to travel during pregnancy
- You or your travel companion is summoned to appear in court, including jury duty
When should I buy trip insurance and can I buy it after I have already booked my trip?
It is recommended to purchase trip insurance as soon as you have booked your trip to make sure you have strong coverage and benefits. You can totally buy it after you have already booked your trip, but if you want certain optional add-ons such as Cancel For Any Reason (CFAR) and pre-existing condition waivers, then you would want to purchase trip insurance as soon as possible. Typically, you have to buy such add-ons within 14-21 days after your initial trip deposit.
What is defined as a prepaid, nonrefundable cost?
A prepaid, nonrefundable cost is any part of your trip you paid for in advance that you won't get back if you have to cancel. This can include the following expenses:
- Flight costs
- Prearranged transportation
- Hotel or stay accommodations
- Event tickets
- Tours
- Cruise costs
How much does trip insurance typically cost?
Trip insurance typically costs about 510% of your total prepaid, nonrefundable trip expenses, but the price can vary based on factors like your trip cost, length, age, destination, and any optional add-ons. For example, for a $5,000 trip, you can expect to pay anywhere from $200 to $500 for a policy. While it adds a minor addition to your travel budget, trip insurance can help protect you from major losses if your plans change unexpectedly.
What is the difference between Trip Cancellation and Trip Interruption?
The difference between trip cancellation and trip interruption insurance is that trip cancellation benefits become available if the trip is cancelled before the journey begins (before the start date of the policy). Trip interruption benefits are available after the journey begins. If for some documented covered reason, your trip is cut short after it has started, you as the insured individual must return to your home country.
What does trip insurance cover that credit cards don’t?
While credit cards with travel insurance appear as “free” with certain cards, dedicated travel insurance provides substantially broader coverage for just 4-10% of your total trip cost. For this modest investment, you gain significantly expanded protection that credit cards simply don’t match, including:
- Trip cancellation coverage for a much wider range of scenarios beyond the standard reasons (including documented traffic accidents, strikes, pregnancy complications, or even divorce)
- Higher medical coverage limits (up to $500,000 or more) for international emergencies
- Coverage for adventure activities and sports equipment
- Reimbursement for frequent flyer points if you need to cancel
- Rental car protection that would cost more if purchased directly
- 24/7 travel assistance services for emergencies, translations, lost luggage help, and medical referrals
While an additional cost to pay for separate travel insurance may seem like a hassle, the small expense can be a genuine lifesaver for many travelers.
