Travel Insurance Guide: Save Your Trip From Costly Disasters

Last March, my friend David called me from a hospital in Barcelona. He had slipped on wet stones near a busy street and broke his ankle badly. The surgery cost $47,000. His credit card limit was only $15,000. He had no travel insurance.

That phone call lasted three hours. David spent most of it crying.

I have helped travelers make insurance choices for eight years now. I have seen families lose all their money because of medical problems in other countries. I have also watched people say insurance was a waste of money. Then they needed it and did not have it.

Here is what I know for sure: travel insurance is not about being scared. It is about being ready for things you cannot predict.

This guide covers everything you need to know about keeping your trip safe. You will learn which policies give you real value. You will find out which companies pay claims without a fight. And you will see exactly how to file claims when things go wrong.

What Is Travel Insurance and Why Does It Matter?

Travel insurance pays for unexpected problems during your trip. It covers medical bills, canceled trips, lost bags, and delays that would cost you a lot of money.

Most travelers think bad things only happen to other people. The numbers tell a different story.

About 30% of travelers have some kind of trip problem each year. The average medical bill for travelers in other countries is over $25,000. Getting flown home in a medical emergency can cost between $50,000 and $250,000.

I learned this myself in 2019. While hiking in Peru, I got very sick from the high altitude near Machu Picchu. The local clinic helped me at first. But I needed a helicopter ride to a hospital in Lima. Total cost: $89,000. My World Nomads insurance paid every dollar.

Without that insurance, I would still be paying off that bill today.

The real question is not if you need travel insurance. The question is what kind of insurance fits your travel style and budget.

How Much Does Travel Insurance Cost in 2026?

Plan to pay between 4% and 10% of your total trip cost. A $5,000 vacation usually needs $200 to $500 in insurance. The price depends on your age and where you are going.

Several things affect how much you pay:

Trip cost sets the base price. More expensive trips cost more to insure. This is because the insurance company might have to pay more if you cancel.

Your age changes medical costs a lot. Travelers over 65 usually pay 50% to 100% more than people under 40. Older travelers have more health risks.

Where you go affects the price too. Countries with expensive hospitals cost more to insure. Japan and Switzerland cost more than Thailand or Mexico.

How long you travel matters for medical coverage. Longer trips mean more chances of needing a doctor.

I compared prices for a 10-day trip to Italy worth $4,500:

Allianz Travel Insurance: $187 for basic, $312 for full coverage

World Nomads: $156 for standard, $243 for adventure plan  

Travel Guard by AIG: $198 for basic, $356 for premium

Berkshire Hathaway Travel Protection: $167 for value plan

These prices are from January 2026 for a 35-year-old traveler. Your prices will be different based on your situation.

What Does Travel Insurance Cover?

Full travel insurance usually covers trip canceling, medical bills, emergency flights home, lost bags, and travel delays. But every policy is different. Read the fine print.

Let me explain each type of coverage:

Trip Cancellation Coverage

This pays you back for trip costs you cannot get refunded when you cancel for allowed reasons. Common allowed reasons are:

Getting very sick or hurt (you or close family)

Death of a travel buddy or family member

Jury duty or court orders

Natural disasters where you are going

Terror attacks at your destination

Losing your job suddenly

Damage to your home that needs you there

Most policies pay back 100% of trip costs up to a limit. But the key is the list of allowed reasons.

Here is what most policies do NOT cover: changing your mind, work problems, being scared to travel, or health problems you already had (unless you buy extra coverage).

My coworker Jennifer learned this in 2023. She canceled a $6,000 cruise because her mother’s cancer came back. The insurance company said no because cancer was a health problem that already existed. She had not bought the extra coverage in time.

Medical Coverage While Traveling

This pays for emergency treatment, hospital stays, and doctor visits when you get sick or hurt in another country. This is the most important coverage for trips abroad.

Your regular health insurance probably does not work in other countries. Medicare pays nothing outside the United States. Most private plans pay little or nothing abroad.

I suggest at least $100,000 in medical coverage for trips to other countries. For adventure travel or remote places, consider $250,000 or more.

Real example: A client broke her leg skiing in Switzerland in December 2024. Her hospital bill was $67,000. Her Travelex policy had $150,000 coverage. She only paid her $250 deductible.

Emergency Medical Flights

This pays for emergency transport to a good hospital or back home. This one type of coverage can save you from money disaster.

Regular ambulances cost $500 to $3,000. Air ambulances cost $25,000 to $250,000 depending on how far you need to go and what medical care you need. Flying a body home can cost over $15,000.

I always suggest at least $500,000 for this coverage. This is not being paranoid. Medical flights from remote places are very expensive.

A family friend had a heart attack on safari in Tanzania. The air transport to Nairobi, then to London, cost $178,000. His Allianz policy paid for all of it.

Baggage Coverage

This pays you for lost, stolen, or damaged bags during your trip. Most policies cover $1,000 to $3,000.

Honestly, this matters less than medical coverage. Most airlines will pay for lost bags eventually. International rules make airlines pay up to about $1,700 for lost bags on international flights.

But bag delay coverage can help. Most policies give $200 to $500 for things you need to buy when your bags are late. This helped me buy clothes after Delta lost my bag for three days in Paris.

Travel Delay Coverage

When flights or transportation get delayed a lot, this pays for food, hotels, and other basic needs. Most policies need delays of at least 6 to 12 hours before they pay.

Most policies cover $500 to $1,500 per trip. Daily limits are usually $150 to $300.

Which Travel Insurance Companies Pay Claims?

The best travel insurance companies have fair prices and pay claims without a fight. Based on customer ratings and my own experience, these companies do well.

I have filed claims with five different companies over the years. Here is my honest review:

Allianz Travel Insurance

Good things: Biggest travel insurer in America, strong money backing, easy claims process, good phone app

Bad things: Prices a bit higher, sometimes long waits on phone

Best for: Travelers who want a trusted big company

World Nomads

Good things: Made for adventure travelers, covers many risky activities, easy to buy online, can buy while already traveling

Bad things: Higher out-of-pocket costs, some arguments about adventure claims, limited phone help

Best for: Backpackers, adventure travelers, last-minute planners

Travel Guard by AIG

Good things: Great customer service, many plan choices, discounts for repeat customers

Bad things: Can be pricey for older travelers, website needs work

Best for: Business travelers and those wanting top service

Berkshire Hathaway Travel Protection

Good things: Warren Buffett’s company, very happy customers, fair prices

Bad things: Fewer plan choices, newer to travel insurance

Best for: Budget-minded travelers who want quality

Travelex Insurance Services

Good things: Budget-friendly, decent basic coverage, long history

Bad things: Customer service varies, claims can take a while

Best for: Budget travelers and trips in your own country

Seven Corners

Good things: Great for long trips, strong coverage for people living abroad, good for military families

Bad things: Less well-known, fewer retail partners

Best for: Long trips and overseas job assignments

### IMG Global

Good things: Strong global network, good for frequent travelers to other countries

Bad things: Confusing plans, some gaps for domestic travel

Best for: Frequent international travelers and digital nomads

Faye Travel Insurance

Good things: Modern website, 24/7 chat help, real-time claim updates

Bad things: New company, limited history, higher prices

Best for: Tech-savvy travelers who want convenience

When Should You Buy Travel Insurance?

Buy travel insurance within 14 to 21 days of paying for your trip. This gives you the best coverage options, including coverage for health problems you already have.

Timing really matters. Here is why:

Coverage for existing health problems needs early purchase. Usually within 14 to 21 days of your first trip payment. Miss this window, and ongoing health problems are not covered.

Cancel for any reason coverage also needs early purchase. This upgrade lets you cancel for any reason and get 50% to 75% back. You usually must buy it within 14 days of booking.

Better prices sometimes apply to early purchases. Some companies give lower prices when you buy early.

I made this mistake once. I booked a $4,000 trip to Japan but waited two months to buy insurance. When my father had heart problems (a condition he already had), I could not cancel and get my money back. I missed the window for that coverage.

That trip never happened. I lost $4,000.

How Do You File a Travel Insurance Claim?

Good claims need quick records, fast notice to your insurer, and organized paperwork. Start collecting proof the moment something goes wrong.

I have filed seven claims over eight years of travel. Here is what works:

Step 1: Document Everything Right Away

Take photos of damaged stuff. Get written reports from airlines, hotels, or police. Save all receipts. Write down names of people you talked to. Note exact dates and times.

For medical claims, keep all hospital papers, doctor notes, prescriptions, and receipts. Ask for bills in English when you can.

Step 2: Tell Your Insurer Fast

Most policies need you to call within 24 to 72 hours for medical problems. Even for other claims, contact your insurer before going home when you can.

Use your insurer’s app or emergency phone number. Get a reference number. Ask for written proof that you called.

Step 3: Fill Out All Paperwork Completely

Missing papers kill claims. Common things you need:

– Filled-out claim form

– Proof of travel (boarding passes, hotel confirmations)

– Original receipts for everything you claim

– Medical records and doctor statements for health claims

– Police reports for theft claims

– Airline forms for bag claims

Step 4: Follow Up Often

Claims usually take 2 to 8 weeks. Check status every week. Answer any requests for more papers right away.

My fastest claim was 11 days with Allianz for a flight delay. My slowest was 47 days with a smaller company for a medical claim. Both paid in full.

What Are the Biggest Travel Insurance Mistakes?

The most costly mistakes are buying too little coverage, not reading what is not covered, and not keeping good records. These mistakes cost travelers thousands each year.

Mistake 1: Buying the Cheapest Option

The cheapest policy often has weak coverage. My friend saved $60 on his premium. Then he found out his $50,000 medical limit was not enough for his $78,000 hospital bill in Singapore.

Always compare what you get, not just what you pay.

Mistake 2: Ignoring Existing Health Problem Rules

If you have any ongoing health issues, you need extra coverage for it. This includes diabetes, heart problems, depression needing medicine, and many other common conditions.

Buy within the special time window. Read how your policy defines existing health problems.

Mistake 3: Thinking Adventure Activities Are Covered

Basic policies do not cover many activities: deep scuba diving, motorcycle riding, bungee jumping, paragliding, and more.

If your trip has adventure activities, make sure they are covered. World Nomads and some others offer adventure coverage.

Mistake 4: Not Reading the Policy

I know reading insurance papers is boring. Do it anyway. Pay attention to:

– How much they pay per incident and per trip

– What you pay out of pocket

– What is not covered

– How fast you must report claims

– What counts as a “covered reason” for cancellation

Mistake 5: Waiting Too Long to Buy

Buying early opens up better coverage. Buying the day before you leave limits what you can get.

Do You Need Travel Insurance for Trips in Your Own Country?

Domestic travel insurance helps with trip cancellation and delays. But medical coverage matters less since your regular health plan usually works in your own country.

For expensive domestic trips, cancellation coverage still makes sense. A $5,000 family cruise can be protected for $150 to $250.

But skip the medical add-ons for domestic travel. Your regular health insurance handles medical problems in your own country.

I do suggest domestic coverage for:

– Trips over $2,000 that you cannot refund

– Trips with older travelers

– Special events (weddings, family reunions)

– Trips during hurricane or bad weather seasons

Is Cancel for Any Reason Coverage Worth It?

Cancel for any reason (CFAR) costs 40% to 60% more than basic policies. But it gives you maximum freedom. It is worth considering for expensive trips during uncertain times.

Basic cancellation coverage needs a covered reason. CFAR lets you cancel for any reason and get 50% to 75% back.

When CFAR makes sense:

– Trips costing over $5,000

– Travel during unstable times

– Pandemic or disease outbreak worries

– Travel to places with visa problems

– Personal situations that might change

When CFAR is overkill:

– Budget trips under $1,500

– Easy-to-change bookings

– Places with easy rebooking

– Travelers with stable personal lives

I bought CFAR for a $12,000 Antarctica cruise in 2023. Two months before leaving, I got a job offer that needed me to start right away. I canceled the trip and got $9,000 back (75% of my cost). Without CFAR, I would have lost everything.

How Does Travel Insurance Work for Medical Emergencies Abroad?

When you have a medical emergency in another country, call your insurer’s 24/7 emergency line right away. They will help you find approved hospitals, guarantee payment, and coordinate your care.

Here is how it works from my own experience:

First steps: Call your insurer’s emergency line. They work 24/7 and often speak many languages. Explain what happened clearly.

Hospital help: Your insurer contacts the hospital to promise payment or set up direct billing. This means you might not have to pay upfront.

Evacuation check: If local hospitals cannot help you properly, your insurer arranges transport to better hospitals.

Claim settlement: For direct billing, you just pay your deductible. For other claims, send in your papers after getting home.

During my Peru evacuation, Allianz handled everything. They set up the helicopter, called my family, and arranged follow-up care in Lima. I never saw a bill.

What Does Travel Insurance NOT Cover?

Travel insurance does not cover things you do on purpose, illegal activities, known events, certain risky activities, and mental health treatment in some cases. Knowing what is not covered prevents claim denials.

Common things not covered:

– Health problems you already have (without extra coverage)

– War or unrest in war zones

– Injuries from illegal activities

– Self-injury

– Extreme sports without special coverage

– Traveling against doctor’s orders

– Pandemics (some policies exclude them)

– Canceling because you changed your mind

– Business equipment

– Dental work (except emergency injury treatment)

Read your policy exclusions carefully. I keep a printed list of exclusions with my travel papers.

FAQs

My Final Advice on Travel Insurance

After eight years of travel and seven insurance claims, here is what I believe:

Always buy travel insurance for international trips. The money risk from medical problems abroad is too big to ignore. Even one medium-sized emergency can cost more than a lifetime of insurance payments.

Buy early. Purchase within 14 days of your first trip payment. This opens up coverage for existing health problems and cancels for any reason options.

Focus on medical and evacuation coverage. These protect against the biggest money risks. Everything else is secondary.

Read your policy. Yes, really. Know what is covered, what is not covered, and what papers you need.

Document everything. When something goes wrong, your first action should be collecting proof. Photos, receipts, reports, and names will decide if your claim works out.

Travel insurance is not exciting. Nobody dreams about checking coverage limits. But having the right protection turns possible disasters into small problems.

David never traveled internationally without insurance again after Barcelona. He still walks with a slight limp from that fall. But his money situation recovered. He has visited 15 countries since then.

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