With the holidays coming up and lots of us planning trips, more people are realizing how important travel insurance is.
New info from Compare the Market about the 2024 summer’s travel trends shows that over a million Brits got travel insurance, 11% more for multi-trip plans and 21% more for single trips than in 2022.
This easy-to-follow guide will define travel insurance, what it covers, and how to pick the right one. In addition, we will explain all the tricky stuff and share five great travel insurance options for 2024.
These picks will have your back no matter where you go. So, whether you’re a travel pro or planning your first trip, stay tuned as we unveil everything you need to know.
Your journey is calling – let’s get started.
What Is Travel Insurance? What Does It Cover?
Travel insurance is like a safety blanket for your trips, whether exploring your city or going global. Imagine you miss your flight to Florida, lose your bags in Berlin, or take a tumble in Ankara; that’s when travel insurance comes to the rescue.
It will cover the costs of unexpected bumps in the road. For example, getting sick, accidents, or flight delays.
Now, how much does travel insurance cost? Usually, it’s about 4% to 10% of your total trip cost. So, if your trip is $10,000, the insurance could be between $400 and $1,000.
Still, remember, the travel insurance cost, or premium depends on the coverage type, age, where you’re going, how much your trip costs, and other factors. Moreover, there are even extra options for business travelers and athletes.
Before you go ahead and get it check if you’re not already covered. Your home or renters insurance might cover you; some credit cards come with cool perks.
Call your insurance person to see what’s what, and ring up your credit card company to know about any bonuses when you use their card for flights, rentals, or hotels.
Many travel rewards cards have built-in insurance and other cool stuff, so it’s worth checking out.
How Does Travel Insurance Work?
Travel insurance can be purchased online through various channels, such as travel agents, travel suppliers, private insurance companies, or insurance brokers when booking accommodations, flights, or car rentals.
Prominent insurance providers include GeoBlue, AIG Travel, Berkshire Hathaway Travel Protection, Nationwide, and Generali Global Assistance.
Typically, coverage is acquired shortly after the initial bookings for lodging, transportation, activities, and rental cars, with some policies mandating this for retaining full coverage.
Familiarizing yourself with key terms related to travel insurance is essential. They include:
Policy Coverage Limits
This represents the highest amount you can receive for a claim. For example, you may only be eligible for $500 per bag, with potential variations for high-value items like jewelry or electronic devices, possibly necessitating the submission of receipts.
Additionally, some coverage might impose a deductible, a flat amount to be paid before covering the remaining claim amount up to the limit.
Coverage Requirements
Qualifying for coverage usually involves adhering to stipulations outlined in the policy. Your claim must align with the types of coverage offered.
For instance, lost baggage insurance might cover personal items, prescriptions, credit cards, and important documents, and you might be required to take specific actions, such as reporting losses or thefts to the police.
Primary and Secondary Coverage
You may have concurrent coverage when you procure travel insurance, implying that multiple policies cover you.
In cases where the travel coverage is primary, the travel insurance reimburses you directly, eliminating the need to claim another provider, thus avoiding potential increases in policy rates.
In contrast, if the insurance coverage is secondary, you must first attempt to file a claim with the other coverage, such as an airline for lost baggage or your auto insurance for damaged vehicles.
Exclusions
These are conditions under which your travel insurance coverage does not apply and exclusions vary between policies.
For instance, luggage damage coverage may not extend to losses due to animals or may exclude instances involving government seizure or items like tickets, bicycles, keys, and hearing aids.
Comprehensive Travel Insurance
Comprehensive insurance consolidates various coverages into a single plan. It commonly includes medical expenses, a 24-hour assistance line, baggage loss/delay, trip cancellation/interruption, and evacuation coverage.
Alternatively, individual coverage types can be purchased separately, which is a prudent choice if you already have travel insurance or can handle potential losses independently.
Coverage of Trip Cancellation or Interruption
Travel insurance reimburses prepaid, nonrefundable travel expenses under different circumstances. The guidelines are:
- Trip Cancellation: Reimburses for approved reasons preventing travel.
- Travel Delay: Covers expenses due to trip delays.
- Trip Interruption: Reimburses for curtailed trips.
- Cancel For Any Reason (CFAR): Allows cancellation for any reason, typically at a higher cost.
Acceptable reasons for claims vary from one insurance provider to another and may include business conflicts, illness, weather-related issues, bankruptcy, family emergencies, or legal obligations.
Notably, while traveling, registering plans with the State Department through the Smart Traveler Enrollment Program (STEP) facilitates contact in emergencies.
Damage and Baggage Losses Coverage
This travel insurance coverage protects against stolen, damaged, or lost belongings during travel, though it often requires exhausting other available claims first.
Restrictions may include coverage limits, such as $500 per item, and exclusions, such as airline-related damages. It serves as protection beyond what carriers might reimburse.
Rental Insurance
Vacation rental insurance covers accidental damage to rental properties and may include trip cancellation/interruption.
Rental car insurance covers damage or loss during a trip, functioning as a secondary policy. Furthermore, it may not cover liability for damage or injury caused to others.
Travel Health Insurance
Medical coverage assists with unexpected international medical and dental expenses, offering varying coverage based on provider and price.
Foreign travel medical coverage spans short to long durations, including medical evacuation. Coordination with existing medical insurers is crucial, as routine medical care is typically excluded.
Accidental Death and Dismemberment (AD&D) Coverage
AD&D policies provide a lump sum for death or serious injury resulting from accidents, with coverage for flight accidents, common carrier incidents, and general travel.
Exclusions may apply, and coverage limits per injury are specified.
Other Travel Insurance Coverage
Additional coverage types may include identity theft resolution, school activity, destination weddings, adventure sports, pet health, hunting, fishing activities, and missed flight connections, depending on the selected plan or package.
How To Get A Travel Insurance
Acquiring travel insurance involves completing an application with pertinent details about your trip. The information required involves:
- Travelers involved
- Estimated cost
- Destination
- Travel dates
- Date of the initial payment made for the trip
The insurance company evaluates this information in accordance with underwriting guidelines to determine policy issuance and the corresponding rate.
Upon approval, the company issues a policy that encompasses your specified trip. In the event of rejection, the option to apply with another insurer is available.
Upon receipt of the policy, a standard 10- to 15-day review period is typically provided to examine the contract’s fine print thoroughly.
If dissatisfied with the policy, it can be returned for a refund. During this scrutiny, ensuring that the selected plan avoids excessive loopholes and provides coverage for essential aspects is crucial.
Top Five Travel Insurance Options For 2024
1. Sompo Holdings, Inc.
Sompo Holdings, Inc. is a Japanese insurance holding firm based in Tokyo, boasting a rich history spanning over 130 years. The company operates in more than 29 countries.
It offers diverse insurance services, including travel insurance, domestic property and casualty insurance, overseas insurance and reinsurance, domestic life insurance, nursing care, seniors coverage, and various digital insurance products.
2. Arch RoamRight
Arch RoamRight, tailored for families, stands out with notable benefits such as coverage for one child under 18 for every insured adult.
After serving as an underwriter for other insurance companies, Arch introduced its brand, RoamRight, focusing on direct consumer sales.
Praised for outstanding customer service, the company offers diverse travel insurance options, including add-on coverage for pre-booked hazardous sports and free coverage for one child under 18 for every insured adult.
Additional features include multi-trip/annual plans, medical-only policies, and emergency evacuation coverage.
3. Sun Life Financial Inc.
Sun Life Financial Inc. is a prominent financial services enterprise specializing in insurance, investments, financial advice, and asset management.
Renowned for its excellence in travel insurance, Sun Life Financial Inc. operates globally, with a presence in countries such as Canada, India, Ireland, Vietnam, the U.S., and Indonesia.
4. World Nomads
It caters to extended travelers, especially digital nomads and backpackers, offering comprehensive coverage for over 200 activities under its premium plan.
World Nomads, renowned for its extensive coverage, is particularly advantageous for those exploring regions with limited infrastructure, political instability, or susceptibility to natural disasters, thanks to its high coverage limits.
Notably, policyholders can benefit from up to $500,000 for emergency evacuation.
Also Read, The World Nomads Travel Insurance: Complete Review 2024
5. GoReady
Affiliated with the experienced parent company AEGIS, GoReady serves many travelers, ensuring worry-free trips.
Boasting a three-decade legacy, GoReady offers hyper-specific plans, including a single-trip comprehensive option, a cruise-centered plan, trip-cancellation-only policies, and high-end coverage for individuals with delicate medical histories.
The multi-trip option, a rare feature in extended policies, covers limitless adventures, incorporating trip cancellation. The coverage also addresses pandemic-related concerns.
Also Read, 7 Best Travel Insurance Providers For Digital Nomads
