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Travel Insurance 101: Your Guide to Buying the Right Policy

Traveling the world and exploring new cultures can be a life-changing experience—but no matter how painstakingly you arrange every last detail of your trip, there’s always a chance that things won’t go according to plan. Maybe it’ll be something as simple as a missed dinner reservation, but perhaps it’ll be something more problematic, such as a hiking injury or a canceled flight.

When things go awry during a trip, having a travel insurance policy in place can protect you and possibly even help salvage your entire vacation. Specifically, travel insurance is designed to provide coverage for medical expenses, lost/stolen luggage, and other catastrophes that can occur on a trip.

With so many travel insurance companies and coverage options available, however, choosing the one that’s best for your needs can be a challenge. By exploring our picks for the top five travel insurance companies and discovering tips on how to choose the best policy, you can move forward in planning your next trip with confidence.

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Best Travel Insurance

  1. World Nomads
  2. Allianz Travel Insurance
  3. Travelex Insurance
  4. Seven Corners
  5. Travel Guard

Reviews of Best Travel Insurance Companies

If you’ve never shopped for travel insurance before, you may not be sure where to begin. Unfortunately, there are some travel insurance “companies” out there that are total scams. To take some stress and hassle out of shopping for a travel insurance policy, we’ve compiled a list of a few of the most reputable and trusted carriers out there today.

1. World Nomads

For those who are new to the travel insurance game, World Nomads makes it easy to shop for coverage and customize it to your liking. They offer excellent medical coverage no matter where in the world your travels may take you, and their adventure-travel coverage is hard to beat. Travelers also enjoy their friendly customer service and painless claims process.

2. Allianz Travel Insurance

If you do a lot of traveling, you might consider purchasing an annual travel insurance policy rather than individual trip policies. Allianz Travel Insurance offers both, but they specialize in annual policies to keep you covered all year-round. There are three different annual plans travelers can choose from, so you can likely find one for your needs.

3. Travelex Insurance

If you do a lot of traveling with your children, Travelex Insurance is definitely worth checking out. In addition to offering fully customizable plans, Travelex is also one of just a handful of carriers that includes free coverage for children under the age of 18. This is a great way for traveling families to save money without sacrificing the protection and peace of mind they need.

4. Seven Corners

While it’s unlikely that you’ll actually need to file a claim with your travel insurance, Seven Corners offers some of the quickest and easiest claims services of any carrier out there. This makes them a smart choice for those who want to avoid a long and drawn-out claims resolution process in the event that you do ever need to file one.

5. Travel Guard

Owned and operated by AIG, Travel Guard offers a wide range of travel insurance policies to suit your needs. They are also known for their quick claims processing and responsive customer service. Whether you’re looking for a single trip policy or annual travel coverage, you have plenty of options here.

Advantages of Using Travel Insurance

If you’re still on-the-fence about spending your hard-earned money on a travel insurance policy, that’s understandable. Take some time to weigh the pros and cons of purchasing travel insurance to help you make a more informed decision.

Medical Protection and Coverage

Hopefully, you’ll never have to deal with the stress of an injury, illness, or other medical emergencies when you travel. If you do, however, you’ll be happy you have a travel insurance policy in place with medical coverage. Specifically, travel insurance can cover everything from being hospitalized at a local medical center to needing to be air-lifted to a hospital (if you’re injured in a remote area).

Reimbursement for Lost Baggage

Some of the most common travel insurance policy claims made are those related to lost or stolen luggage. Unfortunately, airports lose luggage or send it to the wrong destination more often than you might think (that’s why it’s best to just have a carry-on!). And while they may provide you with a voucher to replace some of your essentials until your bag is located, the voucher you receive from your airline is not likely to cover the replacement of any electronics or other costly items.

With a travel insurance policy, you’ll have coverage for the total replacement cost of everything in your suitcase. This includes the cost to replace any travel documents (such as your passport or any other TSA ID documents) if it gets lost or stolen.

Coverage for Canceled Trips

If a flight is canceled, the airline will either reimburse you or provide you with a new flight. However, a canceled or delayed flight could cause you to miss out on other non-refundable parts of your travel plans that you’ve already paid for, such as a cruise or other reservation. With a travel insurance policy that has cancellation coverage, you can be reimbursed for all your other travel plans that may have been affected by a delay, cancellation, or rescheduling.

Peace of Mind in Rental Cars

If you’re involved in an accident while driving a rental car, regardless of who is at-fault, you could be left with out-of-pocket expenses. When you carry a comprehensive travel insurance policy, however, you can enjoy peace of mind knowing that any excess costs related to your accident should be covered. Note, most travel credit cards provide insurance for auto rentals.

Potential Drawbacks of Buying Travel Insurance

While there are plenty of reasons to purchase a travel insurance policy, there are some possible disadvantages to consider as well.

Can Take Away From Your Travel Spending

Travel insurance policies aren’t that expensive when you consider everything they cover, but they can eat away at your travel budget. The money you spend on a travel insurance policy could instead be used to pay for a nice meal or an extra night at a fancy hotel. At the end of the day, it’s all about how much peace of mind is worth. It’s unlikely that you’ll need to actually use your travel insurance policy—and if you haven’t filed a claim by the end of your trip, you may find yourself wishing you had spent the money on something else (or saved it).

Some Events May Not Be Covered

While travel insurance does cover a lot, there are some things that may not be covered by travel insurance, depending on the policy you purchase. Some examples of things that are not always covered by a standard travel insurance policy include:

  • pre-existing health/medical conditions or injuries
  • occurrence of war
  • injuries inflicted by customs agents

The Claims Process Can Drag On

If you do need to file a claim with your travel insurance policy, it could take a while before the claim is processed and you receive your reimbursement. Again, the speed and ease of filing an insurance claim can vary greatly from one carrier to the next. Some companies are known for processing and paying out claims quickly, whereas the process can be drawn-out for others.

Either way, you may need to pay for covered expenses up-front and wait to be reimbursed by your insurance company after you get back from your trip—which may not be practical if you’re on a tight budget to begin with.

How to Buy the Right Travel Insurance Policy

If you’ve decided to buy a travel insurance policy for your upcoming trip, you may be wondering where to begin. Start by comparing quotes and coverage options from the list of top-rated carriers we provided. As you shop and compare, there are a few other tips and considerations worth keeping in mind as well.

Don’t Put it Off

One of the most common mistakes people make when it comes to purchasing travel insurance is putting it off until the last minute. The problem with waiting is that if any portion of your trip is canceled for any reason, you won’t be able to file a trip-cancelation claim to receive reimbursement. Ideally, you should purchase your travel insurance policy as soon as your travel plans are booked. Some travel insurance may even be purchased with airline miles.

If you do choose to wait until closer to your trip to buy coverage, keep in mind that many policies have a 24-hour (or longer) waiting period before they’ll actually go into effect, so you definitely don’t want to wait until the day of your trip to purchase your coverage.

Review Your Current Coverage

To get a better idea of how much travel insurance coverage you need to buy, take some time to review your current insurance coverage. Your health insurance policy, for example, may provide some protection while traveling. Your auto insurance may also provide some basic coverage while you’re in a rental car, though this can vary. Some credit card companies even include some basic travel insurance coverage.

While none of this negates the need to buy a travel insurance policy, existing coverage could save you a little money.

Look Into Exclusions

Travel insurance companies can vary greatly when it comes to what’s covered versus what’s not; there may even be major variations in exclusions from one policy to the next. Before you buy, always take a close look at the list of exclusions so you’ll know exactly what’s not covered by your plan. That way, you won’t run into any unpleasant surprises when you try to file a claim later on.

Save With an Annual Plan

If you do a lot of traveling (typically more than three or four months total out of the year), buying an annual travel insurance policy might be more practical than purchasing a separate policy for each of your trips. Not all travel insurance carriers offer annual plans, so you’ll want to shop around with ones that do. An annual travel insurance plan tends to be more cost-effective while still providing you with the level of coverage you need—and in most cases, you don’t need to have all the details of your trips planned out in order for coverage to kick in.

Take Advantage of “Free-Look” Periods

For added peace of mind, it’s always best to stick with an insurance carrier that offers a “free-look” period. This is essentially a money-back guarantee that allows you to cancel your coverage and request a full refund within a certain period of time after purchase. Typically, “free-look” periods last 1-2 weeks; this can be a great way to secure coverage without losing the ability to shop around and take advantage of a better deal (if you find one). Just keep in mind that some insurance companies will charge some sort of administrative fee for refunding policies, so you may not get 100% of your money back.

Review the Claims Process

Before you purchase a travel insurance policy with a particular company, familiarize yourself with their claims process so you know exactly what to expect if you need to file a claim for any reason. This includes finding out exactly who you’ll need to get in touch with (ideally, you’ll have a dedicated agent you can contact directly) as well as what kinds of documentation is required for common claims.

Hopefully, you’ll never actually have to file a travel insurance claim—but if you do, being familiar with the process and what to expect can help calm your nerves. It’s also a good idea to ask your insurance agent what the average length of time for receiving reimbursement is following an approved claim.

Check Out Online Traveler Reviews

One of the best ways to get a true feel for how a travel insurance carrier operates is to read reviews from real travelers who have had to file claims with them in the past. There are plenty of third-party websites that offer verified and honest reviews of travel insurance companies, so take some time to read these. Specifically, look for information about how happy reviewers were with the claims process and customer service.

The Bottom Line on Travel Insurance

Whether you travel frequently or only on occasion, travel insurance is something everybody should look into before leaving on any kind of trip. The right coverage can provide you with protection in the event of an unforeseen injury, illness, trip cancelation, or even loss of luggage. And while it’s true that you may never actually need to use a travel insurance policy, it’s something you’ll be glad to have for the extra peace of mind alone. Just be sure to keep our tips and recommendations in mind as you shop around for the policy that’s right for you.

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