Travel insurance is something I never thought about. It always seemed to be an add on much like the extended warranties on microwave ovens. Then the pandemic hit. I realized, the unexpected happens. I was lucky. I was able to cancel my trip to Paris and get full, cash refunds. I didn't want travel credit because there are too many unknowns. However, I heard stories of friends being on hold for hours, thousands of dollars in unused air, and cruise credit. I started looking into travel insurance to see what it covered. Also, at that time, I started my travel agency. Travel insurance covers alot of unexpected events.
In general, I would recommend travel insurance for most trips because you never know. All information in this blog is general. Read your plan to know the specifics of your coverage. Typical travel insurance will cover trip cancellations/interruptions and medical coverage. My biggest learning is that when you travel, the risk is more than your initial cost of the trip. Unforeseen expenses can come up and travel insurance will protect you from the unforeseen.
I think this is what we typically think of when we think of travel insurance. If a trip is canceled for a covered reason (or any reason if you have a Cancel for Any Reason waiver) you get your money back for any non-refundable portion of your trip. So I would do a calculation in my head, the probability of needing to cancel multiplied by the amount of the trip that is non-refundable. If that were less than the coverage offered by Expedia (or whomever I was booking with), I would not get insurance.
However, there was alot I didn't consider. What would I have done if something happened and I had to return home early (for example, if someone got sick). Well, not only would I lose the non-refundable part of my trip, but I would also have to pay for last-minute tickets home. What if my whole family was traveling and we needed to get 5 plane tickets home last minute. Even for domestic flights, last-minute tickets can be over $1,000.
What about flight delays? What if the flight out to a cruise was delayed. Well, then, we would have to miss our cruise all together (and lose the entire cost of the cruise) or figure out a way to meet the cruise ship. We all know flights can be substantially delayed. I used to fly weekly between Laguardia and O'Hare. At least once a month, the flights out of Laguardia would be canceled and I wouldn't be able to fly back to Chicago until the following morning. Substantial flight delays are not unheard of, especially if you are flying in the winter.
Finally, what happens if the company you booked with ceases operations? Everyone remembers March 29, 2019, when WOW Airlines suddenly announced they would stop operations. The travel industry has been hit hard by the pandemic. I am sure I am not the only one who is apprehensive about paying deposits. Highly unlikely to get a refund from a company that ceases operations. Again, this is where travel insurance can protect you. This is particularly important if you are booking a safari or cruise to Antarctica.
This is also something I never thought about. I have always had insurance and I am healthy. However, does anyone really know how their medical insurance works abroad? First, are you covered? Second, will your insurance pay the provider directly or will you have to pay and then get reimbursed later? If you have to pay first, how do you access your money? What if you don't have enough cash upfront? Travel insurance will cover these expenses upfront. Obviously, if you are trekking in the Himalayas, this is an issue. However, it is also an issue if you are skiing in Banff or riding an ATV in Cabo.
Travel insurance not only insures you, they also have a 24-hour customer service line. This helpline helps you figure out what you need to do and where you need to go to get help. Even if your kid has a fever, insurance customer service can help you find a pharmacy and let you know which medicine is the closest to Tylenol.
Should I get Travel Insurance?
Yes. Alot of little things can go wrong. Travel insurance insures you against the expenses and helps you deal with the bumps in the road. 99% of the time, things are going to be fine. Little hiccups always happen on trips, but you can usually deal with them. However, if something happens beyond a hiccup, travel insurance will help you deal with it. So when booking a trip, think about the coverage you want. Read all of the fine print and call the insurance company directly with any questions.