First Contact With Travel Insurance

Travel insurance is the least fun thing to buy for a trip. It's also the thing that separates a bad story from a bad life. A skiing accident in Chamonix without insurance can be a $60,000 medical bill. A helicopter evacuation off a Nepali trail without cover is a mortgage-scale event.

The good news is that decent travel insurance is cheap. Even great travel insurance is affordable. The confusion is around what you actually need and what's a waste.

What travel insurance really covers

Most policies bundle several coverages together. The important ones are:

Medical expenses. This is the one that actually matters. If you break a leg in Peru, you want a policy that will pay to treat you and, if necessary, fly you home. Look for at least $250,000 in medical cover, ideally more. US travelers should be especially careful because their domestic health insurance almost never covers them abroad, and Medicare doesn't work outside the US at all.

Medical evacuation. Often listed separately. This is the airlift out of a remote area, or a medical flight home. Should be $500,000 minimum for adventurous trips.

Trip cancellation and interruption. Pays for the money you lose if you have to cancel or cut short a trip for a covered reason. Illness, family emergency, sometimes work reasons.

Baggage loss and delay. Pays out if your bag doesn't arrive or arrives broken. Modest amounts, usually a few hundred to a few thousand dollars.

Travel delay. Reimburses expenses if your flight is delayed enough hours.

The medical and evacuation coverage is the most important. The rest is nice to have.

What it usually doesn't cover

Every policy has exclusions. The common ones catch people out.

Pre-existing conditions. Most standard policies exclude anything you had a diagnosis or treatment for in the last 60 to 180 days before buying the policy. There are policies that waive this if you buy within a specific window after your first trip payment, usually 14 to 21 days.

Adventurous sports. Standard policies often exclude skiing, mountaineering above certain altitudes, scuba diving below certain depths, motorbiking on public roads. Some exclude motorbikes entirely, even if you're just renting a scooter in Bali. Read the fine print or buy an adventure add-on.

Alcohol-related incidents. If you had drinks and hurt yourself, the claim may be denied.

War zones and travel warnings. Most policies won't cover you if you travel somewhere your home country has issued a do-not-travel warning for.

Change-of-mind cancellations. Standard cancellation only covers covered reasons like illness. Cancel-for-any-reason coverage exists but adds significantly to the price.

Credit card insurance, and its limits

Many premium credit cards, especially in the US and UK, include travel insurance when you pay for the trip with the card. This is genuinely useful and reduces what you need to buy separately.

Chase Sapphire Preferred, Sapphire Reserve, Amex Platinum, and many similar cards include trip cancellation, trip delay, baggage delay, and some form of car rental cover. Some include primary rental car collision damage, which can save you the daily add-on the rental company sells you.

The gaps are usually medical. Credit card cover for actual hospital bills is usually low or zero. Buy a separate policy for that piece, or use a card that includes it, and you'll have most of what you need.

Check your specific card's guide to benefits before your trip. The rules change and vary by card and by country of issue.

Annual vs per-trip

If you travel more than twice a year, an annual policy is almost always cheaper than buying per trip. The math is straightforward.

Providers like Allianz, World Nomads, IMG, Cigna, and several regional insurers offer annual multi-trip policies. Coverage runs from around $200 to $600 a year for solid limits.

For US travelers who spend significant time abroad, a full expat policy from someone like Cigna or IMG Global Medical is worth looking at.

Buying before or after the first trip cost

The single most common mistake is waiting until just before the trip to buy insurance. Buy the policy within 14 to 21 days of the first non-refundable payment. Two things happen if you do.

Pre-existing conditions may be waived. This is huge and it's the reason to buy early even if you feel healthy.

Cancel-for-any-reason coverage becomes available. If your circumstances change and you just don't want to go, this pays back most of your money. Usually 50 to 75 percent, which is a lot better than nothing.

Wait too long and both options disappear.

What to actually buy

For a fit adult on a two-week trip to a normal destination, the coverage should look roughly like this.

• $500,000 or more in medical
• $500,000 or more in medical evacuation
• Trip cancellation equal to your total non-refundable cost
• $2,000 to $3,000 baggage cover
• 24/7 assistance line with a real human, in your language

Skip the specific-item riders unless you're carrying camera gear worth thousands. Skip identity theft cover for the trip, your credit card usually handles that.

For adventurous trips, add an adventure sports rider, an altitude rider if you're above 4,500 meters, and higher evacuation cover.

The claim you hope you never make

The one thing that determines whether travel insurance actually works when you need it is the claims process. Two rules matter.

Contact the insurer immediately if something happens. Most policies require you to notify them before you spend money. If you're taken to a hospital, call the 24-hour line as soon as you can. They will often work directly with the hospital to bill them.

Keep every receipt. Every taxi to the pharmacy, every over-the-counter medication, every doctor's note. Photograph them all as you go. Take screenshots of any emails you send.

If everything goes right, you never think about the policy again. That's the whole point.