Travel Insurance: Worth It Or Worthless?

The COVID-19 pandemic has made drastic changes to the travel industry, currently and possibly forever. If you’ve never considered purchasing travel insurance in the past, perhaps going forward you may. How do you make the decision confidently, with so many policies laden with so much fine print? According to the National Association of Consumer Advocates (NACA), a group of over 1,500 attorneys dedicating to providing information and justice to consumers, when it comes to the COVID crisis, many hotels and airlines are offering relaxed cancellation policies, while travel insurance companies have been less sympathetic.

“The travel insurance policy types that would apply to most of those canceled plans are trip cancellation or trip interruption, both of which are usually named-peril plans. This means that they'll honor the coverage on the insurance policy, but ONLY IF the reason for cancellation is listed in the plan. And neither the fear of contracting coronavirus, or the fact that there is a very real worldwide pandemic, are listed reasons.”

Consumeradvocates.org reached out to me to ask if I’d be interested in reviewing their recent report, posted to NACA’s blog, and sharing what they find to be the top picks for travel insurance. Coincidentally, I have a draft of a post started a year ago on this very topic, after my good friend purchased a misleading and ultimately useless travel insurance policy. My goal was to dig into a number of policies, via travel companies, airlines and credit cards to determine what is actually worth the money. Thankfully, NACA has completed diligent research and is eager for me to share it with you! I appreciate that they ranked policies for travelers of budgets large and small.

NACA recommends World Nomad for the Young & Restless traveler. You can find coverage for sporting events, excursions and the like. A basic plan for around 2% of your travel costs can provide you partial reimbursement. For about double the cost, you can acquire a policy that includes medical coverage and could payout as much as 3x your expenses. NACA also endorses World Nomad for the community they create with customers and the resources, like travel guides, they provide.

NACA advocates MedJet as a plan for “VIP” travelers that I would reclassify as “Dare Devils.” It’s not traditional travel insurance, but is a no-limit medical evacuation membership. I have a special place in my heart for this line of work, as my dad piloted medical evacuations after retiring from the airline industry. As most travel insurance plans dictate that you receive medical attention in the location of trauma, you might feel safer when you travel to more remote destinations if you had access to premier medical attention.

For more extravagant travel plans, you’ll likely want a more robust insurance policy. NACA raves about AXA Platinum, for the full cancellation coverage in addition to medevac and repatriation coverage up to one million dollars. “If you want high level, comprehensive coverage that won’t break the bank, AXA Platinum is a great option.”

The post goes on to name a number of other highly rated travel insurance companies. Something very interesting I learned in reading this analysis is that it is standard amongst policies that should an injury or misfortune occur while the policy holder is intoxicated, coverage will likely be denied.

“Though the industry is not perfect, and many customer complaints are completely valid, we discovered that when the right steps are taken, travel insurance really can save your trip, your bank account, and even your life. And isn’t your peace of mind worth the average travel insurance policy price of 4-10% of the cost of your trip?”

I highly recommend visiting NACA’s website and reading their full post, ‘Best Travel Insurance Based On In-Depth Reviews,’ to learn the various types of insurance, how to file a claim and even alternatives to travel insurance.