Is Travel Insurance Worth It?

What you're actually paying for

Insurance trades a small, certain cost for protection against a large, uncertain one. With travel insurance, the large cost is usually the money you've already paid for a trip and can't get back: the vacation rental or hotel, flights, tours, and event tickets. The other is a medical emergency away from home, which can cost far more than the trip itself.

A Standard plan costs about 7% of the trip cost you insure, so about $70 for a $1,000 trip or $210 for a $3,000 trip. A Cancel For Any Reason (CFAR) plan costs about 10.8%, or $324 on the same $3,000 trip. Price your own trip →

When travel insurance is worth it

• You've prepaid a lot, and it's non-refundable. A vacation rental with a strict cancellation policy can keep your whole payment if you cancel close to check-in. A Standard plan reimburses up to 100% of the prepaid, non-refundable trip cost you insure, up to $100,000, when you cancel for a covered reason.
• You booked months ahead. The longer the gap between booking and departure, the more time there is for an illness, an injury, or a family emergency to get in the way.
• Someone at home might need you. The plan covers cancelling or cutting a trip short when a family member dies, or is ill or injured badly enough that a doctor certifies you can't go, even if that family member wasn't coming with you. If anyone involved has an ongoing medical condition, buy within 14 days of your first trip payment so the pre-existing condition waiver applies. More on the 14-day window →
• You're traveling in hurricane or wildfire season. A mandatory evacuation, a weather shutdown that stops your airline for 48 hours, or a rental made uninhabitable by a natural disaster can all be covered, as long as the storm wasn't known, anticipated, or reasonably expected when you bought the plan. For the rental, you also need to buy within 14 days of your first trip payment, and the hurricane can't have been named before your coverage started. How hurricane and natural disaster coverage works →
• You're going abroad. Check what your own health plan pays outside the country. The plan includes up to $25,000 in emergency medical and dental expenses, which in most states pays after any other insurance you have, and up to $250,000 for emergency medical evacuation and repatriation.
• Your itinerary has tight connections. Trip Delay pays up to $600 for meals, lodging, and other reasonable expenses after a covered delay of 6 hours or more. Baggage Delay pays up to $1,000 for essentials after your bag is 12 hours late, except at your return destination, and Baggage and Personal Effects covers up to $1,000 for lost, stolen, or damaged bags.
• Your job isn't certain. An involuntary layoff is a covered reason if you've worked for the same employer for at least two continuous years and the notice comes at least 10 days after your cancellation coverage starts.

When it may not be worth it

• Your bookings are fully refundable. If you can cancel everything for your money back until the day you leave, Trip Cancellation has little to reimburse. You'd be buying the medical, delay, and baggage benefits alone.
• The amount at stake is small. If losing the trip cost wouldn't hurt, and you're staying close to home and your own health insurance, you may be comfortable carrying the risk yourself.
• You're already covered elsewhere. Some credit cards and other policies include trip cancellation or travel medical benefits. Check their limits and covered reasons against what you've prepaid before you decide.
• You're worried about something that's already happening. Travel insurance covers unforeseen events, ones that weren't known, anticipated, or reasonably expected when you bought the plan. An illness you've already been told stops you traveling, a layoff you've already been warned about, or a storm already headed your way may not be a covered reason under a plan you buy afterward.

Standard or Cancel For Any Reason?

A Standard plan pays only when your reason for cancelling is on the plan's list of covered reasons: illness, injury, or death, jury duty, a mandatory evacuation, and the rest. If your reason isn't on the list, such as a work project or a change of plans, it doesn't pay.

A CFAR plan adds the option to cancel for any other reason and get back 60% of your prepaid, non-refundable trip cost, as long as you cancel at least 48 hours before your scheduled departure date. You have to buy it within 14 days of your first trip payment, and it isn't sold to residents of New York. No plan is sold to residents of Hawaii. How CFAR works →

How to decide

1. Add up what you've prepaid that you can't get back if you cancel.
2. Ask whether you could absorb that loss, plus a medical bill away from home.
3. Look at what you already have: your rental's cancellation policy, your credit card's benefits, and your health plan's coverage where you're going.
4. If the gap is more than you'd want to lose, buy within 14 days of your first trip payment. That's when you get the pre-existing condition waiver and the option of CFAR.

Decide when you book. Once something has happened, it's too late to insure against it. If you change your mind, the plan has a 15-day free look: you can cancel it within 15 days of purchase for a full refund of the premium, as long as you haven't left on your trip, had a loss, or filed a claim.

For the full list of benefits and limits, see what travel insurance covers → or compare plans →.