Is Travel Insurance Worth It? 5 Questions to Ask Before You Buy

As I contemplated future travel expenses, I found myself wondering: Is travel insurance worth it? Travel can be expensive and travel insurance seemed like an unnecessary expense. But then I talked to fellow travel writers and enthusiasts, from family weekend trippers to round the world travelers, and they all said the same thing: you need travel insurance for every trip, to any destination. I turned to doctors and emergency personnel, and they said the same. I also read lots of non-sensational but still frightening travel mishaps, and that really drove the point home: for most people in most situations, travel insurance is worth it — but you have to do your research. Here are the 5 questions you need to ask before you buy travel insurance.

travel insurance

Travel Insurance

You may ask, should I buy travel insurance?

Travel insurance usually covers three things: trip cancellation, lost property or luggage, and medical emergencies. While the first two categories are convenient and will save your financial headaches, the third is crucial. The health insurance you have at home likely won’t cover you abroad, and if it does, foreign health care systems rarely like dealing with it (would you?). This leaves you with sky-high bills likely requiring out-of-pocket payment (and a lengthy battle for reimbursement as your holiday souvenir). Of course, exceptions are out there, so the first thing you want to do before shopping for travel insurance is check what your standard health insurance already covers. If you’re one of the lucky ones who enjoy comprehensive medical coverage abroad, you may only need a limited travel insurance plan to cover trip cancellation or lost luggage.

How expensive is travel insurance, really?

It’s not as expensive as I assumed! Cheap travel medical insurance can be found. I personally requested quotes from three top travel insurance companies for my family of five for a hypothetical 15-day, moderately luxurious trip. The rates varied only slightly, and all were under $300 total. These days, you can barely check your bags for that! Two of the best travel insurance companies are Allianz Travel InsuranceSquaremouth and World Nomads.

travel insurance

Before you buy, ask the following travel insurance questions:

1. Will the policy pay upfront, or demand that I cover the bills and reimburse me later?

Remember, emergency bills can easily rise to the thousands, ten thousands, and even hundreds of thousands of dollars. The last thing you want to deal with during a stressful time is covering the bills, even temporarily. Be sure to carefully compare policies to find the best one for you.

2. Can I find one carrier to cover me for multiple trips?

Shopping for travel insurance isn’t exactly how most people like to spend their day, so pick an insurer (and policy) that will see to your needs down the road. Round-the-world journalist Heather Greenwood Davis recommends researching how long of a trip a potential insurer will cover in her article What to Look for in Travel Insurance. Planning to take advantage of the coverage offered by the credit card you used to book the trip is tempting, but most limit coverage to a maximum of 15 days. Do your homework and figure out exactly what a potential insurer will cover  and how long they will cover you (read our post Travel Medical Insurance: How to Compare for more on this).

3. Does the medical coverage include evacuation?

Most people never think of the need of medical evacuation unless traveling to a very remote region. In truth, medical evacuation can be needed in developed areas, and can cost over $100,000 a flight. Find out before buying: does your coverage include evacuation? If not, consider buying a membership with a service such as MedJet.

4. Does the coverage include my entire travel party, including children?

Knowing when to seek medical attention while traveling is hard for any parent. You don’t need the stress of wondering whether you’ll be charged for the full cost of a hospital stay or emergency room visit on top of caring for your child. The good news: most travel insurance companies include free coverage for children with every paying adult.

5. If coverage is through a credit card company, do you need to pay for all or a portion of the trip with the card in order to qualify?

Be sure to ask! If you plan to charge only a portion of your trip on your credit card with travel insurance benefits, make sure you still qualify. If not, consider paying with a card that gives you air miles or cash back instead, and put the savings toward a travel insurance policy.

Do you travel with travel insurance? If so, we hope you haven’t needed to use it!

Comparing the Best Backpackers Travel Insurance

Backpackers are typically young, unemployed, and healthy. So, if you’re looking for backpackers travel insurance, you most likely want a plan that fits your demographic and not that of a wealthy couple going on a cruise to celebrate their 50th wedding anniversary. So, we’ve put together this guide to help you choose the best backpackers travel insurance.

Backpackers Travel Insurance: What to Consider

Price

Obviously the price of the travel insurance policy matters. Compare several cheap backpackers travel insurance plans to find a price that works with your budget. (If you can’t find a travel insurance plan that you can afford, you probably can’t afford to travel.)

Medical Coverage and Evacuation

When comparing backpackers travel insurance take a close look at the medical coverage policy. Does it cover pre-existing conditions? (Most don’t. So if you know you have asthma, and you suffer from an attack, you’re not going to be covered. You’ll need a separate policy.) Hospital costs for emergencies are extremely expensive. Take a close look at the maximum coverage limits. Also look at what happens for an emergency medical evacuation.

Your Stuff, Baggage, and Theft

What happens if you accidentally break your camera? If your luggage gets lost in transit? Or if someone steals your backpack out of your hostel locker? What if someone takes your backpack while you’re looking the other direction? Most travel insurance policies won’t cover theft if your bags are unattended – and “unattended” can mean if you’re looking the other way.

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photo credit: ToastyKen

How to Make a Claim

How easy is it to make a claim if you need coverage? Do you have to call a number? Is it a 24 hour hotline? Can you file a claim online? What sort of proof do you need?

Countries Covered

Most backpackers travel insurance companies will provide coverage for the majority of the countries of the world. (World Nomads covers 150.) But, if you’re planning on going someplace obscure or dangerous, double check that you’ll be covered while you’re there.

Cancellation

See if your policy has trip cancellation insurance. If a family member dies or you get extremely ill, will your policy repay you for unused tickets? To get this coverage you have to buy the policy when you book your tickets and not wait until you’re leaving and suddenly need to cancel.

Liability

Accidents happen. What if you knock over a case of expensive wine while browsing a hole-in-the-wall-specialty-wine-shop in Bernkastel, Germany? Someone has to pay for this. Read this section of your policy carefully to know if you have personal liability coverage.

Activities Covered

What sort of traveler are you? Do you like extreme sports? (Or even regular sports?) Not all policies cover injuries incurred from sports – or certain types of sports. For instance, if you’re hurt while cave diving, World Nomads won’t cover it. But hang gliding? You’re covered. If you know you’ll be participating in some exciting adventures, make sure your policy covers you.

Best Backpackers Travel Insurance

If you’re looking for cheap backpackers insurance, to find the best backpackers travel insurance policy you need to consider your needs. Go through the list above and see what your policy needs to include. Carefully compare insurance policies. We recommend World Nomads and use them for our travels. (Lonely Planet and Rough Guides also recommends World Nomads, in case their endorsement is more important than ours.)

Allianz Travel Insurance and SquareMouth are solid websites for comparing travel insurance plans. However, they don’t cater to the backpacker the same way World Nomads does. So, there isn’t a best backpackers travel insurance, there’s only the best backpackers travel insurance for you.

Cruise Travel Insurance: Is it Worth It?
Should I Buy Travel Insurance?
Buying World Nomads Travel Insurance
Good Travel Insurance Should Cover Financial Loss or Medical Expenses
Travel Insurance How You Can Choose the Best Plan

Photo credit: Ell Brown and EuropeDistrict.