You have your vacation destination picked out, your itinerary in the works, and you're getting ready to purchase your airline tickets. As you’re completing the booking, you’re asked if you want to add travel insurance to your purchase. But how do you know if you need it? Is it worth it to spend the extra money? What does it cover?

Before you bite the bullet and add insurance to your travel tickets, check out these tips to help you decide if it’s worth the investment.

What Is Trip Insurance?

For starters, what is trip insurance? Trip insurance, also called travel insurance, is a specific type of protection intended to cover the costs and losses associated with traveling. It offers financial protection against many issues that could disrupt or cancel your travel plans.

Trip insurance is purchased before you depart on your journey and can cover a range of travel-related risks, including flight delays, event cancellations, lost luggage, and more. Its purpose is to give travelers peace of mind, ensuring that unexpected events don’t result in significant financial hardship.

What Are the Benefits of Trip Insurance?

The primary benefit of trip insurance is the financial protection provided. Unexpected events such as illness, injury, or natural disasters can often result in significant financial loss if a trip is interrupted or canceled. However, if you have trip insurance, you may be reimbursed for pre-paid, non-refundable expenses. These could include flight tickets, hotel bookings, tour costs, attraction tickets, and more. Being compensated for these purchases can dramatically lessen the impact on your budget and potentially allow you to reserve new accommodations if necessary.

Beyond the tangible financial benefits, trip insurance offers invaluable peace of mind. Knowing that you are protected against a wide range of potential problems impacting your plans allows you to enjoy your trip without worry, making your experience more pleasurable.

What’s Covered by Trip Insurance?

Travel insurance policies vary substantially, from comprehensive coverage to more limited policies focusing on specific items like medical emergencies or trip cancellations. Choosing the right policy for your travel plans will depend on your unique needs, risk preferences, destination, and trip duration.

Here are some of the things you’ll typically see covered by basic trip insurance policies:

• Trip Interruption & Cancellation: Coverage for non-refundable expenses if your trip is canceled or cut short due to events like illness with your traveling party or the death of a family member. If someone in the group gets sick and must go home early, or the trip must be rescheduled due to a funeral, it won’t add extra stress.
• Travel Delays: Reimbursement for additional expenses incurred due to travel delays, which may include meals and lodging. If your flight is delayed by several hours or until the following day, you can be reimbursed for a hotel stay and extra meals without worry.
• Medical Emergency: Costs associated with medical treatment, ambulance services, and hospital stays if a traveler is injured or ill during the trip. Medical emergencies can be especially stressful and financially challenging when traveling, particularly if they happen in another country. This coverage ensures travelers can receive necessary medical care without worrying about exorbitant expenses. It may even cover medical evacuation back to the traveler’s home country.
• Lost or Stolen Luggage: Compensation for luggage and personal belongings that are lost, stolen, or damaged. If your suitcase goes missing, you can be reimbursed for new clothing, baggage, and replacement prescriptions.

How Do I Know If I Need It?

Here are some common scenarios where insurance may or may not be worth it for your travel plans to help you determine if you want to pay for trip insurance:

Worth It

• Weather Concerns: If you are traveling during peak hurricane season or to an area prone to earthquakes or floods, the additional assurance provided by travel insurance can be deemed well worth it.
• Multiple Connections or Destinations: If your trip includes several destinations or you have numerous connecting flights, that presents more opportunities for your plans to go awry or luggage to be lost. Purchasing extra protection can be worth the peace of mind provided by insurance.
• Traveling Internationally: If you’re traveling outside the country, you’re likely looking at a more extended, more expensive trip. You’re also probably booking your travel much further in advance than you would for a stateside trip. Due to the advanced planning involved, longer time commitment, and higher costs, you certainly wouldn’t want to lose out on any money and effort you’ve put into preparing. Consider purchasing comprehensive coverage to ensure you’re covered through various circumstances.  
• Large Deposits Required: If you must spend a lot of money to secure your spots, you definitely don’t want to lose out on those funds. If you’ve had to put down significant deposits or made large non-refundable purchases, paying for travel insurance can keep you covered if anything derails your plans.  
• Cruises: Cruises fall into all the major categories for which comprehensive coverage is recommended: large upfront payment, international travel, potential weather concerns, and higher risk of encountering problems. You’ll want to protect your investment and ensure you have options available if things go awry, so buying insurance for a cruise is a wise move.

Not Worth It

• Short Trips or Close Travel: If you’re going for a quick weekend getaway, traveling a short distance, or staying with family or friends, the extra expense probably isn’t necessary.
• Your Credit Card Offers Insurance: If your credit card provides trip insurance, you don’t need to pay separately for coverage. Check the details of your card’s coverage beforehand to ensure you know exactly what’s covered. If you’re concerned about something not included in your existing coverage, you can purchase additional insurance for just that portion.  
• Your Medical Insurance Covers Emergencies: If your existing health insurance plan offers coverage for medical emergencies while traveling, you likely don’t need to purchase any additional coverage. Check your policy to see if you have coverage for international travel to ensure you’re able to receive treatment abroad and that you can receive transport back home.  
• If Tickets Can Be Canceled Without Penalty: If your tickets, reservations, and other bookings can be canceled without incurring any penalty or fees, you probably don’t need to pay for additional insurance. Check the terms of your bookings to be sure.

We’re Here to Help!

Trip insurance can be a valuable investment for travelers, providing peace of mind and financial protection against various travel-related risks. By knowing what is and isn’t covered and how that aligns with your travel plans, you can make an informed decision and determine if additional insurance is worth the cost and how much coverage you need.

If you’re interested in learning how a Personal Loan can help you save money on your next trip versus relying on credit cards, we’re here to help. Please contact us to speak with a team member today.