Travel Insurance: Is it Worth It?
I’ve read many posts about travel insurance, most of them sponsored by an insurance company. Most of the time I find myself nodding along; of course it sounds like a good idea. However, when I find myself buying plane tickets online, and they try to tack on the extra cost at the end, I get miffed and skip it (I’m a notorious cheapskate). Is travel insurance worth it?
I want this post to turn into a conversation and a collection of perspectives. Please leave your thoughts, experiences, and advice in the comments!
Last December My husband and I had to cancel a trip because we needed to care for our dog who’d just had emergency surgery. Cancelling the flight went smoothly and the money was credited to future flights—except that when we rebooked we had to pay a $125 per person fee. Not cool! For us (two people) a $350 trip just turned into a $600 trip. Is it worth paying the rebooking fee to “recover” the money lost by cancelling the fight? I guess that is to be decided by each person in their own situation.
A little math: If I bought travel insurance every time I didn’t end up needing it, for the past two years, I would have spent approximately $175 (7 flights at $25 each). By skipping the insurance, I broke even when I finally needed to rebook and pay the change fee. If I’d continued my good luck streak, I would have come out ahead. Due to this calculation, I’m still on the fence as to answering the question: Is travel insurance worth it?
I consulted my go-to on all financial matters, my dad. He recently booked a tour through Europe and opted in to insurance, which cost about 10% of his total trip. He pointed out that some countries require you to have evidence of international health insurance before arrival. I didn’t know this! He mentioned that he doesn’t usually add it for a domestic trip, but does for international voyages.
Check out my old post on booking flights and hotels.
With “cancel for any reason” insurance, you can cancel your trip and get your money back. Of course, you could also select the refundable ticket at a higher cost. But who wants to check the box for the more expensive ticket when the cheaper one is sitting right there? This is my default, and it’s what got me into the situation I described above. I’m certainly not in financial ruin as a result: I will have to skip a couple new outfits or going out to eat to balance out the budget, but overall, paying the change fee is mostly just annoying.
Health reasons: Here’s the one that doesn’t always come to mind. Let’s say you are taking a camel trek in the Sahara desert but forgot to hydrate. You are overcome with heat stroke and need to be rushed to a foreign hospital. I would wager that your US health insurance card doesn’t go very far at the local clinic. This is the kind of real financial hardship your trip insurance can protect against.
Cost. The added cost for something you probably won’t need is the big con. If you are on a shoestring budget and you are 99.9% sure your trip won’t change, the price of the insurance could cover a couple meals or admission to an attraction you really want to check out. This is generally my default setting unless I’m taking a very expensive (overseas) trip or if the insurance is super cheap (when I went to Mexico, for example, the trip insurance was $5).
If you book using a major credit card, especially an airline card, some types of travel coverage is already included. Check the fine print before you rely on this, but you might be surprised to know that they can go to bat for you. If this gives you enough peace of mind, you may want to skip the add-on.
I typically do not purchase travel insurance for foreign or domestic travel. That said, my husband and I just purchased refundable and tickets (flight and car) to Hawaii because I’m pregnant and I’ll be going later in my pregnancy. The cost of the insurance/incident coverage for both are a very small percentage of the cost of the entire trip, so we figured it was worth it. In the future, I can see myself more highly considering purchasing insurance with kiddo in tow. Sickness, accidents, who knows what will happen? But I think that’s also an American mindset at work in terms of always thinking “What happens if?” But we shall see!
Great perspective! The more people involved, the more unpredictable things could cause a delay. And while you or I could probably still have a good time traveling with a cold or cough, a little one will surely be fussy and their miserable discomfort could ruin the whole trip.
My boyfriend has it and when he got robbed in Italy he used it. However, he only got about $250 back (less than the value of what was robbed), and had to do a ton of paperwork. That being said, he did at least recoup the value of the insurance cost if nothing else. I haven’t ever used insurance on personal travel (through groups and work travel its been provided for me). I did once buy insurance on a trip and then decided to cancel it and since it had just been a few days I only lost $50. Overall I think it depends a lot on where you’re going and how much it costs to replace items you have. Also, the medical aspect could be a decision maker.
Isn’t it interesting how lovely it is to have when someone else pays for it? I’m glad your boyfriend got something back after he was robbed, hopefully he got a little farther ahead than breaking even.
I was going on an international trip that had some risks, and health and emergency evacuation insurance was strongly recommended. Someone said to call my regular health insurance company to see if it is included, and I thought, “Ya right.” But I called anyhow and yes I was covered for international trips and emergency evacuations by my regular health insurance. I think you make the key point of see what you might already (and unknowingly) have coverage for.
That is so great to hear, Paul! Good to know that a few minutes spent on the phone can provide peace of mind and save some money.
I always buy it for long haul travel. Within Europe, I have a health card so I have access to healthcare and that’s the main reason I get insurance (and I don’t bother with it at all on domestic travel). It’s an interesting debate but there are so many things people don’t think of. I’ve never had to make a claim, so does that make it a waste of money? If you get something stolen, like in your experience they only reimburse a certain amount and you have the hassle of claiming. But for me, insurance isn’t about a stolen bag or a cancelled flight. It’s about the $1000 bill I’d wake up to in Australia if I had an accident and someone called an ambulance for me. It’s about the HUNDREDS of thousands of dollars that the US charges in medical fees, let alone if something worse happened. Just one incident and I could be bankrupt. So insurance to me is 100% worth it.
Thanks for your reply! The medical aspect is such an important one. I agree that it makes a lot of sense abroad, and within your home country it’s not always worth it.