How to Find Cheap Travel Insurance

Whether you are traveling for business or pleasure, it is a safe bet that you don’t need anything to go wrong on your trip. You probably also want to make sure you are covered in case something unforeseen does happen. Understanding how travel insurance works and why and when you need it will help you make the most of your dollars and travel with peace of mind.

What Does Travel Insurance Cover?

Travel insurance policies differ widely in what they cover. It is important to determine your risks and needs and then purchase the right policy to cover them. In some cases, you can buy a la carte coverage, which can be less expensive than a broader policy.

There are seven common kinds of travel insurance coverage:

1. 24-Hour Assistance: Many travel insurance plans include this feature. You can access a round-the-clock hotline for anything from finding lawyers and doctors to booking flights after missed connections.
2. Accidental Death/Dismemberment: This insurance can cover death due to an accident on a trip, in which case the beneficiary can receive a lump sum payment. This insurance also covers loss of hearing, speech, eyesight, or an appendage.
3. Emergency Evacuation and Repatriation: This type of insurance can cover transportation in cases where you are injured, sick, and need transit to a hospital. It can also cover the repatriation of remains in the case of death.
4. Personal Belongings and Baggage: If you have personal baggage or belongings damaged, lost, or stolen during your trip, you can be reimbursed. You might already have some coverage through homeowners or renter’s insurance but check to see how much it is and compare the coverage with travel insurance options.
5. Rental Car Coverage: If you are involved in a collision while driving your rental car, then this coverage might apply. However, medical and liability coverage usually aren’t included.
6. Travel Medical Insurance: This type of insurance usually won’t cover routine medical exams or pre-existing conditions, but it will cover emergency illnesses and injuries that occur on your trip.
7. Trip Cancellation or Interruption: This coverage reimburses for nonrefundable and prepaid expenses if you have to cancel or interrupt your trip for a covered reason in the policy.  

When determining how much travel insurance you are going to need, first check your credit card and your health insurance plan. Your credit card may have certain travel insurance features built in. Also, your health insurance might cover certain medical events, but pay attention to what services are in and out of network or not covered at all.

Cost Considerations

Whether or not travel insurance is a good value can be subjective. Most comprehensive travel insurance falls into a range of 5% to 7% of the total trip cost. If you’re paying 8% or more, make sure that you need all or most of the features of your policy.

Many factors contribute to the price of a travel insurance policy. Your total trip cost is always a factor, but you’ll also likely be asked about your age, how long your trip is going to be, and how many people are traveling with you.

As with any insurance, deductibles and reimbursement rates can also determine how expensive or affordable a policy is. Higher deductibles will make the overall policy more affordable up front, but you will also be paying more out of pocket if you have to file a claim.

Finally, travel insurance prices are set by law. That means that a travel insurance policy cannot be sold at different prices, so there is no “lower” price for a policy once you find the one that works for you.

Different Ways to Find Travel Insurance

You are probably already used to shopping around for other kinds of insurance in order to get the best deal. Comparison shopping is also useful for travel insurance. Below are four different ways to obtain travel insurance:

Credit Cards. If you use a credit card to book a trip or rent a car, the card might include some travel protection coverage. However, the coverage is typically very limited and is not customizable.

Travel Reservation Site or Travel Agent. These third parties may offer travel insurance as an add-on when booking various parts of your trip. However, there is typically only one option offered and it is often quite limited in scope and may not be a good value. Again, customization is typically not possible.

Travel Insurance Company. Travel insurance may be purchased directly from the insurance company; however, this method limits your options to the insurance plans offered by that insurance company.

Travel Insurance Comparison Site. Travel insurance comparison sites show you many quotes at once based on the criteria you input for your trip. Using a comparison site can save you a lot of time, since you don’t have to visit different travel insurance company websites. A comparison site will allow you to sort through policies based on pricing and other features. Finally, since the prices are set by law, you pay the same amount for a policy whether you buy it on a comparison site or directly from the insurance company.

Saving Money

Shopping around will save you a lot of money, but below are a few more ways to keep costs down.

• Consider a Travel Medical Insurance Policy: If you don’t need trip cancellation or trip interruption insurance, you may be able to save money by opting for a stand-alone travel medical insurance policy.
• Don’t Insure Refundable Items: Insurance will only cover expenses that are prepaid and can’t be refunded. For instance, if you book a week at a hotel for $3,500 and there is a $500 cancellation fee, your travel insurance is only going to cover $500 if the rest is refundable to you by the hotel.
• Avoid Needless Coverage: Getting $1,000 coverage for lost possessions and baggage might seem like a good idea. However, what if your personal possessions are only worth $250? Make sure you need all of the coverage you are paying for.
• Cover Multiple Trips: If you are only taking a handful of trips each year, getting stand-alone coverage for each one makes sense. If you travel a lot, it is worth considering an annual travel insurance policy.

Emphasize Value Over Cost

In determining what travel insurance is best for you, it is important to balance cost with coverage. Value is what you are really looking for. It’s easy to find cheap travel insurance, but it’s not so simple to find cheap travel insurance that is still good coverage.

The one area where you probably don’t want to skimp is travel medical coverage. Medicare and most domestic health care plans aren’t accepted outside the United States. Baggage insurance, rental car coverage, and trip cancellation insurance might not matter to you as much, especially if you don’t pack anything valuable or have some coverage from your credit cards.

Key Takeaways

With proper planning, the chances of things going wrong on any trip will be dramatically minimized. However, the more time you spend on the road, the more likely it is that something will eventually happen. Knowing how to find affordable travel insurance for your next trip can keep you prepared for nearly anything.

Compare and Buy Travel Insurance

Compare and buy travel insurance plans from top rated insurers