Travel insurance a few years ago wasn’t necessarily a popular option, but as more people travel abroad and take expensive and often adventurous trips, they’re more likely to consider purchasing travel insurance.

Additionally, the COVID-19 pandemic will probably trigger more people to buy travel insurance because there is a lot of uncertainty in the world. Aside from general safety tips to consider before your next vacation, you may also want additional protection if your trip is canceled or impacted by coronavirus in any way.

So is travel insurance worth the cost, and what should you know?

What is Travel Insurance?

Travel insurance protects you from potential financial losses you may incur before traveling or while traveling. Travel insurance can help you recoup your losses from something fairly minor like a delayed suitcase, or something more significant such as having to cancel your trip at the last minute, or even having a medical emergency while you’re abroad.

Travel insurance can also connect you with access to help and services wherever you are in the world if a situation arises.

If you had travel insurance, you would submit proof of loss to the company and they would verify the situation. Then, they would reimburse you for your losses as long as they were covered under the policy you purchased.

The benefits available can vary significantly depending on the company and the plan you choose.

Travel insurance is also meant to cover unforeseeable events, and not necessarily things that you could have predicted would happen. As an example, if you buy travel insurance after a hurricane is headed toward your destination, any losses won’t likely be covered.

If you’re trying to decide whether or not you need travel insurance, you’ll want to think about a few main factors.

First, is your trip expensive? You might consider travel insurance if so.

If your trip is to a foreign destination, it can be a good idea, and also think about what aspects of your trip are refundable versus non-refundable.

For example, if you’re taking a refundable cruise and driving to the port you leave from, you might not have much of a need for travel insurance. In that instance, even if you had to cancel your trip, you might not incur a financial loss.

On the other hand, one reason to consider travel insurance even if you do book a refundable trip is in case something happens to you or someone in your travel group while your away. Depending on the situation and where you are at the time, your medical insurance may not cover the costs.

Before you pay for travel insurance, check the ins and outs of your health insurance but also your homeowner’s insurance and even your credit cards. You may have coverage you didn’t know you had, so you can either skip travel insurance or just use it to fill in gaps.

Travel insurance usually has three main areas of coverage.

First, there’s trip interruption.

Trip interruption may cover expenses from things like flight delays or lost luggage.

Then, there’s medical coverage that will cover some or all of the expenses if you get hurt or sick while you’re traveling.

A third component of coverage is called trip cancellation. The extent of coverage you get with trip cancellation insurance can vary pretty significantly, and you’re only going to be covered under certain circumstances outlined in the policy.

If you add on cancel for any reason coverage, you’ll have more peace of mind, but it does cost more in most cases.

Cancel for any reason coverage may include COVID, but not always.

Typically if you add cancel for any reason coverage, which costs anywhere from 25 to 50% more on average, you can get back around 50 to 75% of your losses.

Does Travel Insurance Cover COVID?

There are a couple of different reasons you might wonder about travel insurance coverage for COVID. First, you might wonder if travel insurance will cover you if you have to cancel your trip because of COVID. Then, you might also wonder if it would cover you if you were to get sick with COVID and need care while away.

Since COVID-19 was declared a pandemic on March 11, 2020, by the World Health Organization, many travel insurance companies now consider it a known, foreseen event.

Your claims related to coronavirus, as a result, are not likely to be covered.

Some companies are offering additional add-on coverage specific to coronavirus, however.

How to Choose Travel Insurance

Choosing travel insurance depends on what you’re willing to spend and what you need to be covered primarily.

You might use an aggregator site so you can cover the basics quickly.

You need to compare the benefits and limits closely.

You can enter your information and the information of the people you’ll be traveling with and usually get an instant quote.

If you’re only worried about the potential for a medical emergency overseas and not so much about losing money on cancellations, you can get a barebones policy that will just cover medical emergencies, but not trip interruption or cancellation.

If you travel frequently or plan to in the near future, you might want annual travel insurance. Annual travel insurance gives you protection for a year of travel and often includes interruption and trip cancellation benefits.

If you’ve booked a trip, the best time to book insurance is as soon as possible. You have to buy your plan in most cases within 14 days of making your first trip deposit, and the farther out you buy a policy, the bigger the coverage window.

Make sure you carefully go over the fine print before you make a decision.

Now is a good time to think about travel insurance, but it’s likely that it’s not going to cover coronavirus-related losses unless you’re willing to pay more. Even then, you’re limited since coronavirus is now an event that you should know about and be able to predict having an impact on your trip.

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