Travel Insurance

Travelers obtain travel insurance for protection from certain financial risks and losses that can occur while traveling. Travelers can have losses from minor issues like a delayed suitcase.  Losses may be more signficant when event like a last-minute trip cancellation or medical emergency occurs. 

Choosing the right travel insurance can be confusing.  Let's see if we can be of help.

Please note, when obtaining any type of travel insurance, it is important for the traveler to understand the terms, conditions, limitations, and coverages or each policy.

Emergency Medical and Evacuation Insurance

Domestic health insurance policies probably do not cover expenses for accidents or medical issues when traveling to any foreign country, and if they do, it is probably for out-of-network coverage.  Medicare provides no coverage for illness or accidents while outside the United States.  In no case will a domestic policy or Medicare provide emergency medical evacuation from a foreign destination back to the United States.  If medical evacuation is needed from Europe, for instance, costs could approximate $100,000.  Emergency Medical/Evacuation insurance does not cover the costs of a cancelled or interrrupted trip.  Consider the Emergency Medical/Evacuation plans from GeoBlue.  See: https://tripinsurancezone.com/geoblue2.html.  For instance, a sample “Trekker Essential Plan” with $50,000 in medical insurance and $250,000 in emergency evacuation insurance costs about $120 for one person and $235 for two people and provides coverage for ONE year.  The cost may vary with age and state of residence.  We strongly, strongly recommend Emergency Medical/Evacuation Insurance for anyone traveling internationally.  Again, carefully read and understand the terms, conditions, limitations, and coverages of any policy you may obtain.

Comprehensive Insurance with Trip Cancellation and Delay

Almost every Trip Cancellation/Delay policy provides Emergency Medical/Evacuation insurance.  Therefore, if buying a Trip Cancellation/Delay policy, there is probably no need to buy a separate Emergency Medical/Evacuation policy.

The most basic Trip Cancellation/Delay policies reimburse travelers, according to the terms of the policy, for non-refundable trip payments and deposits due to the cancellation/delay of a trip. So, if illness, accident or bad weather prevents or delays travel, the insured may be reimbursed for the non-refundable parts of a trip according to the terms of the policy.  Travelers may be covered for other reasons too.  Again, check the policy.

Please read and understand all terms, conditions, limitations and coverages of any policy you may obtain.  A few items merit additional explanation:

  • Travel Insurance usually needs to be purchased in advance of travel, usually when the initial deposit is made.  
  • If an initial deposit is less than $500, it may be considered a “Good Faith Deposit” and may not actually count as the deposit date.  For example, on January 1, 2020 Mary puts down a $100 deposit to hold her spot on a tour that is tentatively scheduled for October 15, 2020.  She might not buy insurance on January 1, 2020 because the final price, itinerary, and date is not firmly set by the tour operator.    On July 1, 2020 the tour operator sets the final price, itinerary, and date and requests Mary to increase her deposit to $750.  Mary pays the additional deposit on July 1, 2020.  Then, July 1, 2020 becomes the “deposit date” for the purpose of buying travel insurance.  Again, this may vary from insurance company to insurance company.  It is best to get clarification from the company.
  • It makes sense that trip insurance will cost less for $5,000 worth of coverage instead of $10,000 in coverage. Therefore, a traveler may opt to not cover the entire cost of a trip.   Think about it, we often buy other insurance policies with deductibles of $1,000 or more.  So, if a trip costs $7,500 for instance, you can choose to insure it for only $5,000, for instance, to save money in the cost of travel insurance and effectively build in a “deductible” of $2,500.
  • An option for travelers might be to purchase an annual policy instead of a per-trip policy.  Annual policies are often much better values than purchasing per-trip policies. This makes good sense for those taking more than one trip per year.
  • Not only is it important to understand what is covered with a travel insurance policy, understand what is NOT covered.  Depending upon the policy, cancellations/delays due to epidemics like the Corona Virus may not be covered.  Other common exceptions to coverage are civil unrest, pre-existing medical conditions, or bankruptcy of a travel supplier.
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