OMAAT reader James asked if I’ve ever written about my approach to travel insurance. As he asked, “not sure if you ever buy it sporadically or have an annual policy, but you’ve been to some pretty far flung places, and I’m curious how you protect yourself and your family when you travel.”
Well, I don’t think I’ve ever addressed this in a post before, but I have a confession to make… and I hope to learn something from the comments section of this post!
I don’t typically buy any sort of travel insurance
I don’t think I’ve ever deliberately purchased travel insurance, believe it or not. Maybe I take too much of an “out of sight, out of mind” approach to this. I can’t say I’m familiar with travel insurance policies in great detail, though generally speaking, I tend to think they fall into one of several categories (with a huge amount of variability, of course):
- There’s the type of travel coverage you may get with credit cards, for things like rental car coverage, lost luggage, delayed flights, emergency evacuation, etc.
- There’s more health insurance focused coverage, for any sort of illness or hospitalization that may happen abroad
- There’s travel insurance that covers things like trip cancelation due to illness, or some policies even allow travelers to cancel their trip for any reason, and receive reimbursement
Typically, my approach has been that I try to strategically use credit cards that offer certain types of travel coverage, for rental cars, delayed bags, emergency evacuation, etc. Beyond that, though, I haven’t really purchased coverage. Why?
- Since I often use airline and hotel points for my travels, that gets complicated in terms of potential reimbursement with these policies, and it also gives me more flexibility, since these kinds of reservations can often be canceled until close to departure
- While the concept of a “cancel anytime” travel insurance policy sounds great, they’re typically astronomically priced for obvious reasons
- So my only concern would be for some sort of a health emergency outside the United States, though frankly healthcare is usually so much more reasonably priced abroad, so it’s not something I put much thought into
- I generally find insurance to be a hassle, given the terms, conditions, restrictions, etc.
I tend to think that insurance policies are important for things you couldn’t reasonably afford to fund or replace, like major damage to a home, treatment for a long term illness, etc. But when it comes to things that could reasonably come up when traveling abroad, I think that I’m lucky enough to have a safety net where it’s not worth spending extra money to be protected in that way.
Similarly, I can understand wanting travel insurance if you’re planning a once in a lifetime trip, or something, but for me, travel is a pretty consistent part of life.
How do other frequent travelers approach travel coverage?
The above is the approach I take, but that’s not to say that it’s the correct approach. If anything, perhaps my luck with traveling so far has made me not consider this, when it’s something I should put more thought into, especially with an increasing amount of family travel. Perhaps I’m just in the “ignorance is bliss” camp.
So I’d love to learn from others. What approach do you take with travel insurance policies? Is there some sort of annual policy that makes sense, especially for those of us who frequently redeem points, and as a supplement to the coverage we have on many credit cards? Or are there per-trip policies that it makes sense to purchase?
Bottom line
I love when I’m asked questions I simply don’t have answers to, because it gives me an opportunity to learn. While travel insurance is a massive industry, it’s one that I’ve not put much thought into. I hope that the limited coverage provided by my credit card will provide some value, but other than that, I’ve never really purchased a policy.
To fellow frequent travelers, where do you stand on the concept of travel insurance? And to those who use it, how do you do the math on it?
