Travel Health Insurance Basics

What you should know about travel health insurance before going on a trip

Although travel insurance was long seen as a luxury, nowadays travel insurance is bought by many consumers concerned about cancellations or the quality of medical care in the area they are visiting. A travel insurance policy that covers comprehensively typically costs five to seven percent of the price of your trip.

You should check whether you already have sufficient coverage to cover your trip through your home insurance, health insurance, or as a perk on your credit card if you charged your trip.

A travel insurance policy generally offers two forms of coverage: trip cancellation/interruption and emergency medical evacuation and care. Sometimes reimbursements for lost baggage or trip delays come bundled with trip cancellation/interruption or emergency medical evacuation. However, do not buy this form of coverage by itself, since it’s usually not a good deal by itself. Look into medical coverage if you have absolutely no health insurance, or if your health plan won't cover you at all while you're abroad. Study your health insurance policy very carefully.

Trip cancellation/interruption coverage is going to reimburse you for any nonrefundable deposits you put down on a trip or cruise if it turns out that you won't be able to go after all, or if you have to leave early. However, it is important to keep in mind the fact that this insurance will only pay out if you have to cancel or leave early because of a covered reason. Always read fine print on your policy. Some policies will cover only medical emergencies, while others will not cover pre-existing medical conditions that act up during your trip.

Trip cancellation/interruption will pay the difference between what you will be able to get back from the cruise line, company, or airline, and what you originally paid. That means that you must seek a refund first with the company before filing a claim on your trip cancellation/interruption insurance.

Trip cancellation/interruption policies also typically cover unforeseen emergencies such as an accident on the way to the airport, a hijacking, a natural disaster, a fire or flood at your house, or a call to jury duty. However, if your job forces you to stay in town, or if your personal financial situation changes, they will not cover you. Travel insurance also does not cover self-induced injuries and problems from the use of illegal drugs.

Your coverage will also depend on how the policy is written. Some policies only pay if the company ceases operations for ten days or more or if it files for bankruptcy. Some touring companies do not bother to file for bankruptcy, which might leave you without coverage for your ruined trip.

Additionally, if you buy your coverage directly from the touring company, this will result in more exceptions on how much coverage you will get in the event of an emergency. It is always better to buy insurance from a third-party source.

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