The question of whether or not to get travel insurance tends to come at three main traveling junctures – right at the beginning of a trip, following a mishap (like getting robbed in Guatemala), or after years of traveling without incident. Travel insurance is one of those services you hope to never use and when you don’t, it can seem like you’re not getting a return on your investment.

worlds more dangerous road

Solving the conundrum of saving a bit of money against the (generally) unlikely event of incident while traveling isn’t simple and best answered with a big “it depends.”

woman in thick black glassesUnderstanding Travel Insurance Basics

There are several travel insurance ground rules to begin with, keeping in mind that medical and coverage for your belongings are the two primary things people buy travel insurance for. I can’t stress enough that coverage varies and any policy or plan comes with a heaping tablespoon (or two) of exceptions, exemptions, and fine print.

  • No Coverage At Home – Short-term travel insurance (less than 6 months especially) usually doesn’t cover you in the country you’re a resident of.
  • Get Insured For As Little As A Week – Plans are generally flexible enough to provide coverage for your specific trip dates so you don’t have to purchase more time than you’re away for.
  • stack of papersPreexisting Conditions – Most travel insurance plans won’t cover any preexisting conditions and others will require you to be a member for up to a year or more before providing it.
  • Caps On Electronics – Many travel insurance plans limit what you can claim on electronics (~$500). They also don’t cover your data so be sure to protect your laptops and setup a backpack security plan. (Limits on stolen cash float between $100-300.)
  • Paperwork Is Required – You’ll need receipts for big-ticket items that might get stolen, police reports, and documentation for any claim you make. Your DSLR can’t be reimbursed if there’s no proof of you ever having one.

There is no shortcut to understanding a travel insurance plan. It’s always in your best interests to read the fine print, not hesitating to call or email the company for anything you’re not clear on.

Some Other Big Caveats

Don’t get me wrong, there is likely a travel insurance plan out there for you (at a price) but these are the common restrictions that are expensive to get around. Aside from the caps on electronics and restrictions on preexisting conditions, travel insurance isn’t likely to cover the following:

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inside iraq arbil citadel

  • Travel To Every Country – Travel insurance companies cover the major travel destinations along with many others but don’t count on countries like Iraq to be on the list. Generally speaking, international borders define coverage, so trouble in a small section of a country might eliminate it entirely.
  • Certain Situations Not Covered – Unpredictable events like political demonstrations (e.g. Thailand’s Red Shirt protests), riots, terrorist attacks, outbreak of war and what might happen to you during them aren’t covered.
  • HIV, Pregnancy, And Mental Conditions – Sexually transmitted diseases (STDs), in particular HIV and related costs, are not usually covered.
  • Travel Warnings – If a travel warning is issued by your government for a particular nation your coverage may change. Find out what criteria prospective insurers use to determine how safe a country is.
  • Prescription Drugs – Usually requires special coverage, if at all possible.

Travel insurance policies don’t cover immunizations for the most part and you’ll have to be careful with the wording of any specific coverage. The word “theft” may mean many things to you but for most insurance companies having something stolen from a hostel locker or a friend’s car won’t count.

teddy bear nurseYou May Already Have Coverage

Making online reservations with a credit card may entitle you to some basic insurance, covering the cost of a canceled flight or car rental. Business travelers and contractors should never fly without knowing who’s insuring your personal belongings. Chances are if they’re used for work (even just a tiny bit), you can get them insured by your company.

Local Emergency Service – Some countries, particularly those in Western Europe, will provide emergency medical coverage if you, let’s say, break a leg. Do not take that to mean that you’ll be treated and sent off on your merry way for free however – typically all this means is you’ll be treated, even if you don’t have proof of insurance. A few stitches might not dent your travel budget but emergencies that require surgery or hospitalization are almost never covered – so you might be stuck with a huge bill once you recover from that coma.

  • Reciprocal Agreements – Your country may have reciprocal health care agreements with others – Australia has 8 – which means another government might provide you with (some) health insurance coverage while visiting. Check if your country has any reciprocal agreements with the places you’ll be visiting and call your embassy for details.
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Don’t ever assume you’ve got coverage – unless you can verify otherwise. Check the national department of health equivalent or the embassy website if you think there’s a reciprocal agreement in your case. Otherwise, ask your boss if you’re on the company dime and give your credit card company a call to see how they might (already be) able to protect you.

dollars and centsHow Much Basic Travel Insurance Costs

Take these prices with a grain of salt and like all things insurance can change based on many factors. That said, generally you can insure a 1 week trip for around $50-75; a 6 month trip for around $300-500; and find plans for a year of extended travel starting at $800 on up. That unscientific sample was drawn from prices for a single traveler using the US, India, South Africa, and a few European nations as home and averaged out across several popular companies.

A decent rough calculation of how much travel insurance will cost you is to take your total travel costs and add 20% for an upper value.

do you use travel insurance

balancing actSo, Is Travel Insurance Worth It?

Travel insurance, as you can see, is a complex solution to a simple problem. (Multiplied for traveling families and older travelers.) Start by considering the things you want to insure – laptops and other electronic devices that depreciate quickly probably aren’t worth the capped protection but for appendicitis or a dislocated ankle it might save you tens of thousands of dollars.

It’s presumed that new travelers are more prone to theft or certain types of mishaps while it’s easy for experienced travelers to get complacent. The fact remains the chances of you suffering a medical catastrophic or otherwise are remote whether at home or on the road. The longer you travel however, without any insurance at all, the greater the odds of bad luck hitting you without a backup.

That misfortune could be a stolen camera or getting hit by a car. It’s a gamble of if it happens and how lousy. You can only look at unused insurance as money lost, or being on the road without it as cash saved – until something bad occurs. The difference is in the first case you’ll likely be much better off afterward.

[photos by: liako (bikers on world’s most dangerous road), Teeejayy (woman in thick glasses), HB Art (stack of papers), tatiana.nyanko (teddy bear nurse), Jeremy Brooks (dollars and cents), orangebrompton (balancing act)]