I never considered travel insurance until I was flying to Seattle for a conference at the tail-end of the coronavirus pandemic. I remember opening the policy, feeling quickly overwhelmed by the amount of information, and deciding I’d take the risk without it.
Then, the omicron variant hit. Two days later, the conference was cancelled and I was stuck with a nonrefundable plane ticket and hotel room in a city overrun by rising coronavirus cases.
Looking back, I would have benefitted greatly by opting into a travel insurance policy, and that’s hardly the only instance where it can come in handy.
But, they are admittedly complex. If you’re feeling intimidated by travel insurance, you’re not alone. Like some other traveler programs, travel insurance policies can be confusing and difficult to navigate. But to learn from my prior mistake, and educate myself moving forward, I looked at plans across providers to find trends in typical coverage, including unexpected gaps in coverage and tiny caveats in small print. Here’s what you need to know to protect yourself on your next trip.
In this article
Check the Covered Cancellation Causes
Travel insurance can cover all sorts of trips and destinations, but it’s usually the most helpful for major international trips, since these can be the most costly when it comes to time and money.
Travel insurance is also recommended if the area you’re visiting is prone to natural disasters like hurricanes or tsunamis, or if visiting requires tricky logistics and you’re concerned that one travel delay could ruin your entire trip.
Generally, most travel insurance policies from major carriers like Faye, Allianz, and Travelex provide reimbursement if your trip is cancelled or shortened due to a significant change outside of your control. This generally includes instances such as an unforeseen death of a family member, terrorist attacks, natural disasters, or critical illness.
Some providers, like Travelex, also offer a higher reimbursement if your trip is interrupted and you’re forced to return home early.
Just remember: each plan and provider is different. So if your concern isn’t as common, or you aren’t sure, always check the fine print first, as fatiguing as it can be to read.
There is Always a Caveat
Like with all insurance policies, the fine print is chock-full of even more fine print. Generally, anything deemed minor or avoidable, even if it’s outside your control, is excluded from reimbursement.
For example, according to Travelex and Faye, termination from your employment is a suitable reason to cancel your trip, but only if you aren’t at fault and had been with the company for at least a year.
In other instances, travel insurance companies like Faye, Travelex, and Allianz could pay for damaged goods in your baggage, but only if they weren’t breakable or fragile. If they were, they’re likely not included.
All to say, I highly recommend downloading the specific policy language and giving it a full read-through before picking a plan. There could be much less coverage than you might expect, and if you’re only booking one to protect that glass vase you plan to transport, it might not be worth it.
Not All Injuries and Illnesses are Covered the Same
In order to be reimbursed through an insurance policy, any illness or injury must first manifest itself during your trip. So, for example, if you had symptoms of a cold before the trip and it turns into bronchitis, your expenses would not be covered, according to Faye, Travelex, or Allianz. Pre-existing conditions are usually not covered, either.
Additionally, the same companies maintain that injuries resulting from risky adventuring activities like racing, mountaineering, skydiving, diving, or participating in a sporting event are typically not covered. Some providers, like Faye and Travelex, however, offer an optional adventuring add-on for an additional cost.
Somewhat macabrely, accidental dismemberment reimbursement can vary based upon the part of your body you lose.
With Travelex Ultimate, for example, you’ll receive only 50% of your maximum amount if you lose a single hand or foot.
Coverage Also Depends on Your State of Residence
For me, one of the most surprising parts of travel insurance is that the coverage is different depending on the state you live in.
With the Travelex Ultimate plan, for instance, the maximum covered amount for emergency medical expenses is typically $250,000. But if you live in New Hampshire, that number drops to $50,000 due to state-mandated benefit limits. The optional pet upgrade is also unavailable in Virginia and New York.
From what I’ve seen, not all companies make these exemptions crystal clear. When choosing your state as New York in Faye, for example, it shows the “Pet add-on” as included, but a deep dive into the state-specific policy document shows that you’re not eligible for pet-based reimbursement if you live in New York.
This is really tricky, so be sure to review the policy document specific to your state before making any major decisions.
The Shortcut
Travel insurance comes in handy in the event of surprise trip cancellation, but only major, unplanned reasons like serious illness or natural disaster that leaves your destination uninhabitable.
It’s absolutely necessary to read each plan detail in full since coverage and reimbursement totals depend on a number of caveats and exclusions.
Only illnesses or injuries arising during your trip are eligible for emergency health funds. Pre-existing conditions and injuries from risky activities are typically not covered.
Due to state laws and regulations, relevant coverage and reimbursement totals depend on your state of residence. Always view the policy document for your specific trip before buying.
