Is Credit Card Travel Insurance Enough?
When you're looking to insure your trip investment, you might consider credit card travel protection. Many credit cards do offer some measure of travel insurance. But the question that's become even more relevant since the pandemic is: Is credit card travel insurance enough protection? The answer to this question depends on a variety of factors, including the nature and duration of your trip.
Credit card travel insurance is usually limited to trip insurance, flight insurance and car rental insurance. But the coverage is usually basic and very limited. Premium credit cards may offer coverage related to lost or damaged luggage, and even offer some financial protections against medical care related to COVID-19. But even the best credit card for travel insurance does not compare to the coverage traditional travel medical insurance and trip insurance can give you.
Travel insurance offered by credit cards generally does not include:
- Health coverage
- Emergency evacuations
- Emergency room costs
- Emergency reunion
What Does Credit Card Travel Insurance Cover?
Some credit cards don't offer any travel insurance benefits, so it's important to look at the details before you apply for the card. If your credit card does give you travel insurance, the coverage will vary depending on the credit card type and company. If you're only worried about flight accident insurance or trip delay coverage, insurance from a credit card may actually be enough for your needs.
Why Travel Insurance May Be a Better Option
If you want dependable medical coverage, travel medical insurance is still your best option. By paying as little as $300 up front you could save yourself the crushing financial blow of a $30,000 dollar medical bill. Credit cards with travel insurance included can't offer that kind of expansive coverage.
Unlike travel credit card insurance, traditional travel insurance can offer emergency evacuation coverage for both medical and non-medical reasons, as well as coverage for emergency room visits or hospitalizations, and may even cover acute onset of pre-existing conditions.
But probably the greatest advantage for post-pandemic travelers is that travel insurance can include Cancel For Any Reason insurance (CFAR). Basic trip insurance and the kind of coverage you'd get with even the best credit card insurance won't protect your financial investment if you need to cancel your trip for a non-covered reason.
You may see some reimbursement if your flight is cancelled or a natural disaster thwarts your plans, but other reasons, even those related to a Covid surge in your destination country, may not be covered. CFAR insurance allows you to cancel your trip for literally any reason. Whether you feel uneasy due to Covid, or you just don't feel up to making the trip, CFAR lets you recoup prepaid expenses that would have otherwise been non-refundable.
Here are some things to watch out for when considering credit card travel insurance coverage:
- A lot of exclusions or fine print. If there are pages of exclusions or caveats to your credit card travel insurance program, that may be a sign that the plan is more limited than you think. Some companies will bury important information in pages of fine print. This can result in your claims being denied if you find yourself needing to use your policy.
- Confusing or vague travel insurance policy wording. If you don't understand the wording in your policy, call up your credit card company and ask them to explain. Certain phrases can be key to understanding what your plan covers. Keep a lookout for phrases that could relate to exclusions such as: we will not pay for items left behind, forgotten or misplaced.
- Low claim limits. Some plans may have very low claim limits and may not cover the amount of money you think it will. It's better to know this before you opt in for credit card insurance and certainly before you have a reason to use coverage.
- Destination or activity restrictions. Some plans won't cover certain destinations or activities. If you want to enjoy some adventure sports like windsurfing or even snorkeling, policy exclusions can mean that the provider won't cover any portion of your trip. Make sure that all your activities and excursions are covered by the plan you choose.
- Limited protection against high-cost healthcare countries. If you are traveling to a country with particularly high medical costs, like Japan or the United States, you need to make sure your plan covers you should you have an injury or illness that requires emergency care. Minimal coverage can result in high medical bills.
Have questions specific to your travel plans? Reach out to our Customer Success Team for help.