There’s more to travel insurance than meets the eye. And while sometimes that’s a good thing, like when we discover it covers more than we originally thought, other times it can feel overwhelmingly complex.
Don’t feel discouraged. Start by understanding the basics of what is covered by travel insurance and the different types of coverage. From there, you’ll be able to customize your plan and choose the best travel insurance for your next trip.
What Does Travel Insurance Cover?
In general, travel insurance protects three things: your money, your belongings, and your health.
Note that each plan has different levels of coverage and exclusions. When shopping for a plan, take the time to familiarize yourself with coverage requirements.
Money
Travel insurance provides coverage for a variety of scenarios, including trip cancellation, interruption, and delay. These situations often cause us to lose money we’ve already paid or incur additional expenses, like when we need a hotel for an extra night or need to rebook on a different flight that was more expensive than our original airfare.
Imagine there’s a hurricane at your destination and you have to cancel your trip. If you already paid for some of your travel arrangements — your airfare, your hotel, maybe an excursion — and they can’t be refunded by the company you booked with, one of two things typically happens to those prepaid expenses.
- If you don’t have travel insurance and the travel provider doesn’t give refunds, you lose your money.
- If you do have travel insurance, you can be reimbursed. Travel insurance picks up where the travel provider leaves off. If they don’t give refunds, your plan can help make sure money gets back in your bank account. And it’s money — not a voucher for future travel you may or may not be able to use.
Belongings
If your luggage is lost, stolen, or destroyed during your trip, you might need to replace it. Travel insurance can provide compensation for that loss.
Travel insurance can also reimburse you when you replace essential items like clothing if you arrive at your destination and your bags don’t.
Health
Medical bills can add up. And your health insurance at home typically does not cover you in other countries. If you get sick or hurt during your trip, you don’t want to have to pay for care out of pocket. Depending on the situation, you might not even be able to afford to do that.
Travel insurance can cover the cost of medical treatment if you suffer an injury or illness on the road. Some plans also include emergency medical evacuations and repatriations if you need to get to another location for necessary care.
Types of Travel Insurance
Now that you know what travel insurance covers in general, let’s talk about types of travel insurance. Most of the types we mention below will include protection for money, belongings, and health. How expansive that coverage is can vary, though, depending on the plan.
International travel medical coverage
Travel medical insurance provides medical coverage for those traveling abroad. If you get sick or injured on your trip, travel medical plans can cover anything from doctor and hospital fees to dental treatment, emergency transportation, and more.
Many policies also cover pre-existing conditions and accidental death and dismemberment, as well as provide 24/7 multilingual emergency travel assistance.
Different plans offer different levels of medical coverage. Similarly, some may have trip protection benefits such as trip cancellation, while others might be strictly medical plans. It’s important to choose one that fits your needs and budget.
Trip protection coverage
Trip protection plans provide some of the best coverage for your money and belongings. They can protect you if:
- You need to cancel your trip for a covered reason
- You need to interrupt your trip, returning home early or joining it late, for a covered reason
- Your trip is delayed for a covered reason
- You miss a cruise or tour connection
- Your luggage is delayed, lost, stolen, or damaged
Most trip protection plans also provide medical benefits, although these might not always be as robust as what you’d find on a travel medical plan like we mentioned earlier.
Cruise insurance
Cruise insurance has many benefits similar to what you find in trip protection plans with the addition of coverage specifically designed for cruises. This includes:
- Cruise Diversion, which provides compensation if your cruise does not stop at a scheduled port due to inclement weather, natural disaster, or mechanical breakdown.
- Cruise Disablement, which provides compensation if you are confined for more than 24 hours on a cruise ship without water, food, power, or restroom facilities.
- Itinerary Change, which covers unused nonrefundable expenses for activities or events if you can’t participate in those activities because your cruise line eliminates a destination from your itinerary or changes your itinerary.
A good cruise insurance plan will also include missed cruise or tour connection coverage. This is a great benefit to have in case you’re worried about missing your ship because of a flight cancellation or delay on your way to the port.
Outdoor and adventure activities coverage
One of the reasons you should be familiar with the requirements of any plan you purchase is to know what activities could be excluded from your coverage. For example, not all plans cover scuba diving, so if you get hurt on a dive during your Caribbean vacation, your medical expenses might not be covered.
Fortunately, you may be able to add Adventure Activities coverage to your plan for these situations. Ask about the availability of this optional benefit when you purchase your travel insurance.
What’s considered an adventure activity can vary by plan, but it often includes things like scuba diving, snorkeling, riding a moped or motorbike, and hot air ballooning.
Cancel for Any Reason (CFAR) coverage
Cancel for Any Reason (CFAR) coverage is another optional benefit you may be able to add to your trip protection plan.
With typical trip cancellation coverage, you can only be reimbursed if you cancel for a covered reason such as a natural disaster or an illness that prevents you from traveling. If you cancel for a reason that is not covered in your plan, you won’t be reimbursed.
However, if you add CFAR, you can do just as the name implies — cancel for any reason, not just the ones listed in your plan. This gives you greater flexibility to change your travel arrangements without losing all of your prepaid expenses.
Interruption for Any Reason (IFAR) coverage
Interruption for Any Reason (IFAR) coverage is very similar to CFAR in that it allows you to interrupt your trip for any reason you wish, not just the reasons listed in your plan document.
Perhaps your destination isn’t all it’s cracked up to be and you decide to move to the next stop on your itinerary early or even come home ahead of schedule. Simply changing your mind about being on the trip wouldn’t be covered by the standard trip protection plan, but IFAR could reimburse you for the unused portions of your insured expenses.
Find the Right Travel Insurance
You can learn more about travel insurance — from how to read a plan document to the advantages of an annual plan — so that you feel more confident choosing the right plan for you. We also have licensed agents ready to take your questions and help you decide what coverage works best for your trip.
Visit SevenCorners.com to get a quick quote and purchase travel insurance when you’re ready.
