Should you actually buy travel insurance?

You think about it after you pick out your seats for your next flight. Or when you’re booking a hotel room. Or maybe just when your daydreams about your next vacation turn into day-nightmares about what could go wrong. It’s travel insurance, and it’s something that most of us evidently feel we could do without. (In a 2013 survey, only 21% of travelers said they’ve purchased it, and a mere 7% of travelers said they buy travel insurance regularly.)

And yet, that trend seems to be shifting, with an astounding 65% of millennials saying they expect to buy travel insurance in 2018, according to the Berkshire Hathaway Travel Protection report State of Travel Insurance 2018. So what’s going on—what exactly is travel insurance, and why is it suddenly so popular? And more importantly: Should you actually buy it?

What is travel insurance?

This turns out to be a tricky question because the terms can vary widely. Generally speaking, it’s a form of insurance that protects your travel budget in case your plans change for whatever reason. (There are some exceptions, including if you simply change your mind about travel plans, or if you go somewhere against your own government’s travel advisories.)

Insurance may cover the cost of a ticket you can’t use, the cost of evacuation in case of a natural disaster, the cost of evacuation and/or treatment in case of a medical emergency, the cost of lost luggage, or just about anything else you can think of.

Adding to the potential confusion, there are a lot of different sources for travel insurance. Your credit card might offer some version of it, and so might a third-party insurer. Generally speaking, the latter will offer more comprehensive coverage, but the best place to start is to find out what kind of coverage you might already have, and where (if anywhere) you might need to upgrade. You’ll also want to make sure you understand how your potential insurers define certain terms, and how that might affect your potential claim. (One example is how your insurer handles medical coverage. If you have a condition that’s considered pre-existing—say you have a heart condition, then have a heart attack while traveling—your care might not be covered. Seek clarity if you’re unclear on anything.)

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Why is travel insurance having a moment?

Simply put, more people have more access to information (including online reviews and articles like this one), and more companies are offering smarter forms of coverage. Not so long ago, travel insurance favored older customers, who were more likely to have health risks, more likely to have the time and resources to spend on expensive trips, and more likely to have the necessary funds to afford insurance.

Today’s younger traveler is more likely to seek out information online and feel comfortable acting on it, including buying insurance online (something Haven Life knows a thing or two about). Furthermore, there seems to be more awareness that the world can be a dangerous place, and that purchasing travel insurance can be a proactive way to hedge against the potential financial downfalls of exploring it.

Should you buy travel insurance?

As with any form of insurance, you’ll want to start by weighing the potential costs of getting insured against the risk and potential costs of losing any money you’ve set aside for your trip

So let’s start with how much you’re outlaying for your trip. Only you know what’s considered a big spend, but suffice it to stay that you’re more likely to need insurance if you’re carrying expensive luggage and staying in hotels versus backpacking and staying in hostels. Other critical factors include:

Whether you’re staying overseas (where your current insurance might not be accepted or applicable)
Whether you’re traveling with kids (who can make planning challenging)
Whether your trip includes anything dangerous, either an activity (like mountain climbing… on a volcano… filled with sharks) or your destination itself

A good rule of thumb: Imagine how you’d feel if the money you’d set aside simply disappeared, and you weren’t able to go on your trip. If that feeling hits you pretty hard, you might want to consider insurance.

Then, consider what the refund policies are for each important part of that trip. As an example, I had a honeymoon planned for the Caribbean, when my destination was hit by a tropical storm just days before we were set to arrive. We didn’t have insurance, but both the airline and the hotel refunded us in full. This was, in retrospect, a lucky break, as we hadn’t researched the issue before disaster struck. Be sure to investigate the policies of your airline, your hotel, and any other major elements where you’re spending a lot of money upfront.

Where should I look for coverage?

As mentioned above, research any coverage you might already have through other sources, including your other insurance policies. (As an example, a road trip might require different coverage than a flight due to your previously existing auto coverage.) At the very least, you should review those policies online, or better yet, call someone at the company to confirm what is and isn’t covered.

Finally, investigate other sources of coverage for anything that still concerns you. A few types of coverage include: Trip cancellation coverage; Trip interruption coverage (in case you’re able to make part of, but not all of, your vacation); medical expenses (again, these might already be covered through your health insurance); additional coverage for any dangerous sports or activities; emergency evacuation coverage; coverage related to lost / delayed luggage and flights.

If it sounds stressful, that’s because it is. But remember that your vacation itself should be a reprieve from stress, and making the right decision (that’s right for you) on insurance will offer you some all-important peace of mind. That, and making sure you remember to pack sunscreen.

Louis Wilson is a freelance writer whose work has appeared in a wide array of publications, both online and in print. He often writes about travel, sports, popular culture, men’s fashion and grooming, and more. He lives in Austin, Texas, where he has developed an unbridled passion for breakfast tacos, with his wife and two children.

Opinions expressed by the author are their own, and do not necessarily represent the views of Haven Life.