Unexpected costs due to illness and injury, canceled flights, damaged electronics, lost luggage, the death of a family member back home — these are all covered by travel insurance.
In a nutshell, travel insurance is an all-purpose emergency coverage plan. It’s the single most important thing you should get for your trip and something I strongly, strongly advise travelers to never leave home without. I’ve seen it help so many people over the years – people who would have been out thousands of dollars otherwise.
Travel insurance was there when my friend had to be helicoptered out of the Amazon after he fell off a boat, when another friend’s father died and she had to fly home, and when another friend got her bag stolen.
Travel insurance is designed to make sure you don’t lose a ton of money if an emergency happens abroad. Since most domestic health insurance programs don’t cover you overseas and travel credit cards offer limited protection, buying travel insurance is something you definitely need to protect you against the unknown.
Since travel insurance is one of the most complex, important, and confusing aspects of trip planning, I want to break it down for you, help you understand what it is about, and show you how to pick the best travel insurance plans in just a few steps!
What to Look For in a Great Travel Insurance Plan
Insurance is a billion-dollar business and everyone wants their hand in the cookie jar. Consequently, you face a mind-numbing number of companies, policies, and terminology that can be confusing and overwhelming.
And, in the fine print, you’ll often discover that plans aren’t as good as they initially appear.
First, make sure your travel insurance offers a high coverage limit on your medical expenses. A good company will provide up to $100,000 USD in coverage care, though more expensive policies will cover you for higher amounts. The maximum coverage limit you can find is around $2,000,000 USD, though I’m not sure why you would ever need a limit that large.
High coverage limits are important because if you get sick, injured, or need serious attention and have to seek professional care, you want to make sure your high hospital bills are covered. The worst thing you can do is go cheap and get a policy with a $20,000 USD coverage limit, break a leg, and reach that limit before they are done taking care of you. Don’t be cheap with your health. Ensure you have coverage for at least $100,000 USD.
Second, you want to make sure your travel insurance policy also covers emergency evacuation and care that is separate from your medical coverage. If you are hiking in the woods and you break your leg, your policy should cover your evacuation to the nearest acceptable medical facility.
If a natural disaster occurs and you need to be evacuated to somewhere else, your plan should cover that as well. This protection should cover an expense of up to $300,000 USD.
Additionally, make sure you understand if your evacuation coverage will pay for you to get home or if it will just send you to the nearest acceptable facility.
For example, if you break your leg abroad, most insurance policies will pay for your hospital bills. However, they won’t pay for you to get home since it’s not a life-threatening injury requiring advanced care.
Standard emergency evacuation coverage frequently only moves you if your current facility is inadequate or if it’s “medically necessary.” Only then will they pay for a flight home.
In short, double-check if your company will cover the cost of your flight back home if you need it.
Third, great travel insurance plans always include the following provisions:
- Coverage for most countries in the world (including the places you plan on visiting).
- Some coverage for your electronics (and have the option for a higher coverage limit).
- Coverage for injury and sudden illnesses.
- Offer 24/7 assistance (you don’t want to call to be told to call back later).
- Coverage for lost, damaged, or stolen possessions like jewelry, baggage, documents, etc.
- Coverage for cancellations for hotels, flights, and other transportation bookings if you have a sudden illness, death in the family, or some other emergency.
- Coverage for political emergencies, natural disasters, or strife in the country that causes you to head home early.
- Financial protection if any company you are using goes bankrupt and you are stuck in another country.
What’s Not Covered By Your Travel Insurance
Just as important as knowing what your plan covers is knowing what it doesn’t cover. Generally speaking, most plans don’t cover:
- Accidents sustained while participating in extreme adventure activities such as hang gliding, paragliding, or bungee jumping (unless you pay for extra coverage).
- Alcohol- or drug-related incidents.
- Carelessness in handling your possessions and baggage.
- Recklessness (how “reckless” is defined is a matter up to each company).
- Pre-existing conditions or general check-ups. For example, if you have diabetes and need to buy more insulin, you won’t be covered. If you want to go see a doctor for a general check-up, you aren’t covered either.
- Lost or stolen cash.
- Your theft coverage won’t cover you if you left something in plain sight or unattended.
- If civil unrest makes your destination unsafe but your government hasn’t called for an evacuation, you’re probably out of luck too.
Buy Your Travel Insurance As Soon As Possible
You can buy travel insurance up until the day you leave for a trip (since it usually takes 24-48 hours to kick). Some companies, like Safety Wing, allow you to buy plans abroad. You can buy travel insurance even after you’ve booked your flight, so long as the policy is activated before you depart.
Even though you can wait until you leave, it’s best to get your travel insurance as soon as possible. Every day you wait, there’s a chance that something could happen, and you can’t get travel insurance after something goes wrong.
If a hurricane ruins your trip, your travel insurance would only cover you if you bought it before the hurricane formed. Buy a plan the day after you go to the doctor but before he tells you you’re sick? Your plan won’t cover you since your original visit happened BEFORE the plan.
Don’t wait to get insurance. I’ve seen it happen too often. The second you know you are going somewhere and have the dates, buy travel insurance!