Best Travel Insurance Companies

Travel insurance is a type of insurance that protects individuals and families from specific financial losses that occur before, during or after a trip. The exact coverages you get from a travel insurance plan can vary greatly, as can coverage levels, limits and deductible requirements.

Still, it's possible to set up a travel insurance plan that reimburses you when a trip has to be canceled for reasons beyond your control, or to secure coverage that will pay for medical bills and emergency transportation if you become ill or injured during your vacation. Some travel insurance plans can also reimburse you for lost, damaged or delayed baggage or other expenses that occur as a result.

As you shop around for travel insurance, you will quickly notice that different types of coverage and limits are included in different plans. That's due to the fact that some travel insurance plans are more comprehensive than others and some travel insurance providers include more types of protection in their policies overall.

Trip cancellation insurance

Trip cancellation coverage reimburses you for prepaid travel expenses when your trip is canceled for a reason beyond your control. Examples of this include canceling due to illness of someone who planned to go on the trip or the death of an immediate family member.

Trip interruption insurance

This kind of coverage applies when your trip is interrupted after you depart but a covered situation is preventing you from moving forward. You might be able to use a trip interruption benefit if you become injured or ill after your trip begins and you need to return home or if a natural disaster prevents you from reaching your destination.

Emergency medical expense coverage

This kind of coverage pays for emergency medical (and potentially dental) expenses that occur when you're away from home and your own health insurance does not apply.

Daniel Durazo of Allianz Partners USA says this may be the most important coverage for consumers to purchase, particularly if someone on the policy ends up in a situation requiring medical care that needs immediate out-of-pocket payment. This is common overseas, where it’s common to have to pay for services before leaving the hospital.

“That’s why choosing a travel insurance policy with appropriate medical benefits is a smart move,” he advised.

Emergency evacuation and transportation coverage

According to Durazo, medical evacuation and transportation costs can easily range from $15,000 to $200,000 (or more) depending on the traveler’s health condition and where they are in the world. This is why another important type of coverage is emergency evacuation, which could be required if you become sick or injured in a remote area and need an ambulance, helicopter or plane to get you to the nearest medical facility.

Also note that emergency medical evacuation coverage may pay for transportation back to your home country if it’s deemed medically necessary.

Trip delay coverage

Trip delay coverage can pay for unexpected expenses that pop up when your trip is delayed for a specific length of time — usually six or 12 hours. This kind of coverage can reimburse you for meals, accommodations, communication and transportation costs you may pay while waiting for your trip to depart.

Insurance for lost, stolen or delayed baggage

Many travel insurance plans also cover financial losses due to baggage that is lost, stolen or delayed while in the care of a common carrier like an airline. Insurance for lost or stolen baggage can reimburse you (up to limits) for your baggage and personal effects, whereas delayed baggage insurance can reimburse you for incidental expenses that arise while you wait for your bags to show up.

What travel insurance plans cover can vary from plan to plan, which is why you'll want to read over your policy details and the fine print so you know for sure. That said, it's important to remember that travel insurance is for unforeseeable events or situations beyond your control that you can’t predict.

This means you can't use travel insurance to pay for costs resulting from routine health care, or wait to buy travel insurance for a beach trip after a named hurricane is already in the area. However, there are a number of instances where it does apply.

Essentially, anything not listed as covered in your policy will not be eligible for reimbursement through travel insurance. However, some items not covered by travel insurance may catch consumers by surprise.

Make sure to read your policy carefully to see if preexisting medical conditions, including pregnancy, are covered.

For example, James Clark of Squaremouth, which helps consumers compare travel quotes, says that preexisting medical conditions typically are not covered unless the traveler chooses a policy that offers coverage for preexisting conditions shortly after booking their trip.

"Preexisting condition policies must be purchased within 14 to 30 days of making your initial trip deposit and don’t typically cost any additional premium," said Clark.

Clark notes that many travelers also have the misconception that travel insurance will cover regular health-related issues that may impact their trip, including hospital costs that result from pregnancy and delivery. However, most policies don't cover pregnancy-related expenses, such as prescription medication, delivery charges and postpartum visits.

Other situations typically not covered through travel insurance include:

• Participation in high-risk activities and sports (unless explicitly included in coverage within the policy details)
• Cancellations due to known storms
• Government-issued travel restrictions
• Acts of war
• Losses caused by unlawful acts

Before you select a travel insurance policy, you need to think over the type of trip you are planning and the risks you're taking on as a result. For example, a road trip adventure that only lasts a few days will typically require a different type of coverage than a luxury cruise or an international trip that lasts several weeks.

Adequate medical coverage is the first factor to consider when selecting a travel insurance policy.

Consider these tips to ensure you wind up with the best travel insurance plan for your needs.

• Line up adequate medical coverage first and foremost. Because medical expenses and medical evacuation are often the most important coverages in a travel insurance plan, you'll want to make sure the limits you get are sufficient for your needs. If you have a preexisting medical condition, make sure the plan you're considering lets you get coverage for your condition right off the bat (even if an added cost is required).
• Weigh potential risks for your specific plans. Also look at your specific trip and make sure you have coverage that makes sense. For example, a vacation with several different flights and connections should have adequate limits for trip delays and lost or delayed baggage. Meanwhile, you may want to have specialized coverage for a cruise, including coverage for travel inconveniences and missed excursions.
• Consider coverage limits. Keep coverage levels in mind as you compare plans and policies, particularly if you're sensitive to price. As an example, some basic travel insurance plans only offer a few hundred dollars (or even less) in coverage for baggage delays and $500 or less in protection for your luggage and personal belongings.
• Check whether you get 24/7 travel assistance. Durazo says another major benefit of travel insurance is the assistance services many providers offer, which can apply wherever you are in the world. He adds that this type of coverage can arrange medical treatment in an emergency, monitor customers’ care, provide interpreters, help replace lost passports and more.
• Consider optional CFAR coverage. Also ask yourself about the likelihood of you being unable to travel, and if you want the chance to cancel and get some of your money back. If you feel there's a chance you won't be able to go, consider buying optional cancel-for-any-reason (CFAR) coverage that reimburses you for 50% to 80% of your prepaid travel expenses when you decide not to travel for any reason at all.

Applying for travel insurance is relatively easy, and you don't have to submit nearly as much information as you do when you apply for other types of insurance coverage. The steps below can help you line up coverage for your next vacation or even multiple trips you plan to take over several months.

If you’re hesitant to purchase travel insurance, consider some of these alternatives:

• Credit card travel insurance: Some travel credit cards offer included travel insurance benefits that apply when you use the card to pay for your trip. Coverage you may be able to get with a credit card includes trip cancellation and interruption insurance, primary rental car coverage, trip delay benefits, lost luggage reimbursement, emergency evacuation insurance and more.
• Membership programs: Some membership plans can pay for emergency medical evacuation anywhere in the world, and you can secure coverage on an annual basis if you prefer. These may offer all-expenses-paid medical transport to the medical facility of your choice, language translation services, coverage for the transfer of mortal remains and more.
• Travel protection: It's also possible to purchase travel protection directly from some travel providers at the point of sale. If you purchase a flight through Delta, for example, you can add on a policy that provides some coverage for trip cancellations and lost baggage. Just remember that travel coverage offered through airlines and cruise lines may be limited, and that coverage for medical expenses may be limited or nonexistent.

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