Just 18 months ago, the standard travel insurance policy wouldn’t have covered losses stemming from a pandemic. But nowadays some countries demand exactly that and travel insurers have been forced to pivot.
Costa Rica, for example, now requires all international visitors to carry at least $50,000 in travel medical insurance that covers quarantine and medical costs for visitors who test positive for coronavirus.
Some airlines will help you make sure you have the right coverage for your destination by checking your documents at the gate. “They don’t want to fly you somewhere only for you to be told you can’t get in because then the airline is responsible for getting you home,” said Scott Keyes, the founder of Scott’s Cheap Flights.
But there are other things you may want to consider. Even when it’s not required, travel medical insurance can fill gaps in your health insurance coverage and possibly save you tens of thousands of dollars in emergency medical expenses.
Medicare and many U.S. health insurance plans often don’t cover health care for people while they travel outside of the U.S. Some American insurance networks are so restrictive that even medical emergencies during domestic travel would incur high out-of-pocket costs.
“Don’t make the mistake of assuming you’re covered for whatever situation,” Keyes said.
Read the fine print
As the world was shutting down in early 2020, travelers were forced to face the fine print of their travel insurance policies. Not only were pandemics explicitly not covered by travel insurance at the time, but the full refunds some buyers had been expecting didn’t materialize.
“They would have had to buy a more expensive policy,” Keyes said.
Today, travel insurers explicitly state how their policies apply to Covid-19. Allianz Travel Insurance, for example, will consider claims for trip cancellation and interruption if an insured person, family member or traveling companion becomes ill with Covid-19 before or during the trip. Being afraid to travel isn’t enough to trigger Allianz’s epidemic protection.
Whichever carrier you consider, you’ll want to read the COVID-19 portion of their fine print especially closely to make sure it meets your needs.
There are other caveats to pay attention to as well. People looking to use travel insurance included as a credit card perk need to book their travel with that card. That goes for rental cars as well. Being a cardholder isn’t enough for coverage to kick in.
Remember, it’s okay to purchase your travel first and then shop around for a travel insurance policy for your trip, especially if you’re purchasing pieces of your trip through multiple sites.
Figure out what kind of coverage you want
The typical travel insurance policy in the U.S. includes coverage for trip cancellation, travel delays and baggage delays. Many policies also include coverage for emergency medical care and evacuation if necessary.
The most common reasons for trip cancellation — unexpected illnesses and deaths in the family — are generally covered under standard travel insurance policies.
These policies typically don’t cover the kind of emergencies you can predict. Normally, COVID-19 would fall under this umbrella but insurers have had to adapt and now treat it as they would other medical emergencies.
For expenses related to changing your mind, however, travelers would need to upgrade to Cancel For Any Reason coverage. Cancel For Any Reason policies cost more but allow travelers extra leeway to recoup at least some of their lost costs. “It is in fact ‘cancel for any reason,’” said Stan Sandberg, co-founder of the comparison site TripInsurance.com.
This coverage is for anyone who wants the option to change plans without having to provide documentation of their illness, including COVID-19. Travelers should still expect to be out for a portion of their trip cost — generally 25% for anything other than a covered medical reason.
Travelers looking to cancel for any reason will need to change their plans at least 48 hours ahead of time unless the decision is driven by an unexpected illness, weather-related disruption or hospitalization.
Figure out how much protection you want
Coverage for trip cancellation tends to be the most expensive part of travel insurance. It usually costs between 4% and 10% of the total cost of the trip, making a pricey dream trip more expensive to insure.
For travelers who can live without trip cancellation coverage, travel insurance can be had for under $25.
For international travel, Stanberg recommends between $50,000 and $1 million in travel medical coverage. But he adds, “I can’t think of too many scenarios where you’d be facing evacuation costs of $1 million.”
Hiking in the Himalayas and facing a medical emergency would be one of them. He recommends travelers pursuing adventure sports or traveling to remote locations consider paying more for additional benefits
“The incremental cost may not be as much as you think,” he said, “especially if you’re shopping for peace of mind.”