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Tips for Navigating the Complex World of Travel Insurance

Finding the right policy for your trip can save you thousands of dollars

by Lark Gould

August 15, 2023

Travel Insurance / Photo: William Potter/Shutterstock

It takes little to ruin a business trip or vacation, and you don’t even need a disaster. When bad stuff happens to good trips— even if it happens before the trip—it can turn into a tangle of phone calls, receipt searches and letdowns by companies unless smart research and the right questions lead to better outcomes.

Finding the best travel insurance policy, like navigating a mirrored fun house, can be confusing. However, finding the right match for your trip can save you thousands of dollars. Keep in mind that this insurance may add five to ten percent to the cost of your travels.

The Main Areas of Concern

When it comes to travel insurance policies, there are seven main areas of concern: trip interruption, trip delay, trip cancellation, cancellation for any reason, medical expense coverage, medical evacuation coverage and baggage loss. Insurance policies offer a range of protection options, but using them typically involves lots of paperwork and specific time frames for making claims. The policies also have a detailed list of circumstances under which losses are covered or not. Full reimbursement is not always guaranteed, even if a claim is approved.

For instance, Cancel for Any Reason policies only reimburse 50 to 75 percent of a nonreimbursable tour, cruise or flight and must be used within a restrictive window. If applied properly, any reason will do. However, a trip interruption plan, for example, may not be valid if the trip was interrupted for the wrong reason or at the wrong stage of the trip.

Medical expenses can be confusing, especially when traveling abroad. Your regular insurance might be enough for domestic travel, but for international trips it might not be enough. You’ll need additional coverage for medical expenses and transportation back home.

Choose an Allianz premium plan for 24/7 assistance. Get coverage for pandemics, but note that coverage for war, terrorism, floods and hurricanes may differ. Consider your destination’s risks and add coverage as needed. See airline strikes, stormy weather or volcanic eruptions in your travel future? Trip delay insurance will cover your lodging, meals and other costs while waiting for a flight to clear. Vanished bags can benefit from baggage delay protection that generously reimburses for a few days of necessities.

And while many premium credit cards offer some access to travel insurance coverage, they cannot be customized or counted upon to fit the needs and problems that may arise.

“We expect to see a record-breaking number of American travelers this summer, and those numbers can mean an increased chance of travel delays,” said Daniel Durazo of Allianz Partners.

“A devilish mix of inflation and strong demand have kept travel prices elevated. Protecting pre-paid expenses with a travel insurance policy that also offers travel delay coverage can end up being one of the smartest investments travelers can make.”