Is Buying Travel Insurance Worth It?

Illustrated by Elliot Salazar.
You've seen this checkbox pop up before: Just when you're about to check out on a travel booking or airline site, you get offered "trip protection" at a special price. This add-on typically gets brushed off as the site's attempt to squeeze an extra buck, but it's worth thinking twice before going on a trip without travel insurance.
You may think that nothing that crazy will upend your trip, but it only takes one bad storm or a lost suitcase to ruin your experience. Worst case scenario? You can get hit with an unexpected medical condition. With a prevention plan in place, you'll at least salvage some of your financial loss.
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“A comprehensive travel insurance plan with trip cancellation coverage will range from four to eight percent of the total trip costs,” according to Stan Sandberg, co-founder of TravelInsurance.com, a comparison site for such packages. “When travelers consider the various circumstances that can take them by surprise when away from home, they realize that the cost to invest in a good policy is nominal by comparison.”
To help you better understand the terms and conditions of these schemes, we've asked Sandberg on what a typical policy covers. Remember: You can sign up for a plan at any time prior to your departure day, so there's still time to safeguard your next vacay — even if you're already booked.
What's Covered
Weather And Unforeseen Cancellations
Hurricanes, snowstorms, and other extreme weather conditions are often reasons for flight delays or cancellations. Staff strikes, mechanical problems, and passenger misbehavior are also common reasons keeping you from taking off on schedule. According to Sandberg, you should be able to get a full reimbursement with an insurance plan for circumstances listed in the policy.
Lost Luggage
Airline luggage regulations have changed in light of recent security concerns, and as a result, more and more of our valuables are going into our checked bags. In the event that you baggage goes missing, an insurance plan will compensate your loss, at the range of $1,000 to $2,500 per person with a $100 to $250 per item limit.
Medical Issues
A vacation is just about the worst time to get sick. Your medical costs while traveling are generally fully covered by a travel insurance plan, provided that your circumstances pass a customary and reasonable test. Be sure to keep a copy of your receipts and diagnosis as proof. However, most plans will exclude coverage for losses due to a pre-existing medical condition, unless you’ve purchased and qualified for a plan that offers a pre-existing exclusion waiver.
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Work-Related Problems
Your travel plans can sometimes be derailed by reasons that have to do with your job, whether it's a last-minute project or an unexpected redundancy. According to Sandberg, most insurance plans will provide full coverage for termination of employment or a sudden relocation.
What ISN'T Covered
Change Of Mind
"Some people believe that a travel insurance plan is designed to give you the flexibility to cancel your trip for any reason whatsoever, but the standard plan is not going to provide cancellation coverage for a change of heart — whether it's a breakup or an outbreak of Zika near your destination," says Sandberg. To get that flexibility, you would need to purchase a plan and opt for the "Cancel for Any Reason" upgrade. Even then, the best they can do is a 75% reimbursement of your total trip costs if you cancel 48 hours or more from your departure date.
Pre-Existing Conditions
Although travel insurance is an excellent safeguard against many types of medical emergencies abroad, from accidents to evacuations, most policies have built-in exclusions for pre-existing conditions. If you’ve been seriously ill in the past or need ongoing treatment, consider looking for a plan that offers a pre-existing condition waiver.
Expensive Personal Belongings
While travel insurance provides coverage in many situations, this may not include your more expensive personal belongings. If you travel with luxury clothing or expensive items, be sure to note that your travel insurance policy may not make you whole if your belongings are lost or stolen. On top of that, many plans will also specifically exclude computers, cell phones, musical instruments, business equipment, and sporting equipment. "Certain plans do offer an optional upgrade to provide coverage for business and sporting equipment if this is a concern, but it’s always smart to check your homeowner’s insurance to see what additional coverage it provides," says Sandberg.
Incidents Under The Influence
Travel insurance is designed to protect against the unforeseen and unexpected perils that can happen while you're traveling. "If you injure yourself as a result of being intoxicated, your travel insurance policy will not cover you," says Sandberg. "Almost all travel insurance will exclude coverage for losses incurred as a result of being intoxicated or under the influence of drugs." So, you might want to go easy on those piña coladas if you want to covered.
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