How (and Why) to Buy Travel Insurance

Scuba diving in clear blue water of Richelieu Rock in the Surin Islands, within Mu Ko Similan National Marine Park, Thailand. Credit Caine Delacy for The New York Times

Picking the best travel insurance to buy for your coming vacation can be a daunting task, said Stan Sandberg, the co-founder of the trip insurance comparison site TravelInsurance.com. “There are literally hundreds of plans out there, and they are all steeped in complex legal language that can be hard for even the savviest consumers to decipher,” he said.

A good travel insurance plan, he said, gives you peace of mind that the money you’re spending on your trip isn’t lost if you end up not going and costs, on average, from 4 to 10 percent per person of the total cost of the trip per person.

Here, he shares his top tips on buying a travel insurance plan.

Figure Out What You Want to Insure. Are you looking to protect an investment in nonrefundable airfare, hotel or cruise costs? Or do you need travel medical protection? Mr. Sandberg said that many travel insurance plans bundle both types into a single plan, which may be unnecessary but definitely costs more.

Travelers who aren’t looking for travel medical insurance, for example, and want only to insure travel costs, need a trip-cancellation-only policy. Similarly, travelers who aren’t concerned about the risk of cancellation, but want medical coverage can find a number of choices for medical-only plans. These single-category plans are cheaper. “Some travel medical insurance plans with emergency evacuation are as little as $50 a person,” Mr. Sandberg said.

Check Your Health Insurance Before Hitting the Road. Many travelers assume that their health insurance will cover them for any medical services, Mr. Sandberg said, but that is not always the case. “Most health plans today are based around in-network-only coverage, which means that you’re not covered if you see a doctor out of network, unless it’s for emergency or urgent care,” he said.

Whether you’re traveling domestically or abroad, a travel medical plan can help bridge the gap of in-network-only health insurance and save you an exorbitant out-of-pocket fee if you need to see a doctor for any ailment like a stomach virus or heat rash.

Adventure and Active Travelers, Beware. Fitness fiends and thrill seekers should buy a plan that offers coverage for hazardous and adventure sports, Mr. Sandberg said. “Many travel insurance plans exclude coverage for accidents or injuries that happen during certain activities deemed to be higher risk like skiing, scuba diving or bungee jumping,” he said. Some plans offer hazardous sports coverage as an optional upgrade while other plans include it.

A Cancel-for-Any-Reason Plan Is the Most Flexible. “If you decide the week before your trip, that you’re too scared to travel, the money you spent on the trip is protected up to 75 percent,” Mr. Sandberg said. Be aware that these flexible plans cost up to a few hundred dollars more than standard travel insurance.