Travel Insurance: What You Should Know Before Your Summer Trip

We're getting closer to the start of summer, which means more people are prepping vacation plans and family getaways. 

Even when we have those travel plans in place, unforeseen circumstances can always pop up to change our course.

With so many factors outside of our control (like the ongoing COVID-19 pandemic) that could lead to a trip being canceled or postponed, you may be wondering if travel insurance is a worthwhile expense.

Travel insurance is not the same as trip protection, even though it sounds like the same thing, and many travelers think they're interchangeable. 

Travel insurance is a regulated product underwritten by an insurance company. 

Trip protection, which is often offered by travel agencies or travel companies, is less comprehensive and less expensive, and it typically only offers to waive a fee or to give you a credit for canceling your trip.

Early in 2020 when the pandemic first started, travel insurance didn't always cover trip cancellations due to the shutdown. But now, travel insurance policies have changed, offering more COVID-related protections. 

If you're traveling this summer, we'll tell you about travel insurance coverage for cancellations, how it's different from trip protection, and what to consider before making a purchase. 

Travel insurance is a major type of insurance policy overseen by state insurance regulators. By purchasing a travel insurance plan, you could be reimbursed for losses that may arise while you travel.

Covered incidents can range from unexpected inconveniences such as delayed baggage, to major interruptions such as illness or injury. 

As always, check with official sources regarding visa and travel requirements to your specific destination, since you don't want to be caught off-guard. 

If you want to take a trip to Cuba, for instance, you may be surprised to find you need non-US medical insurance, according to the Department of State. A trip insurance policy will cover this requirement.

The typical travel insurance policy consists of two elements: trip cancellation services and health costs. 

If you're unable to travel due to an unforeseen event, travel insurance will reimburse you for the nonrefundable upfront costs, like flights and hotel reservations that otherwise can't be refunded

Unforeseeable events typically include things you have no control over that prevent you from traveling, such as inclement weather, an injury or a sickness -- which now includes COVID-related illness in most (but not all) cases. 

This wasn't on offer when the COVID-19 shutdowns began in 2020. "[The public] was nervous because most insurance policies had pandemic exclusions," said Michael Giusti, an analyst at Insurance Quotes.

 "But the travel industry pivoted toward the consumer and included COVID under the policies. And so, if you get sick with COVID and can't travel, they'll cover your expenses."

Unforeseen events caused by preexisting conditions are even covered. For instance, if you have asthma and experience an attack, that still counts as an unforeseen event, according to Giusti. Foreseen events, such as traveling during your eight month of pregnancy, are not covered.

Government mandates that may come into effect while you're traveling aren't necessarily covered either, Giusti said. 

This means that, if you can't get on a flight because of a new mandate, you may not be covered by your policy. 

And fear of travel is also not covered -- so if you're afraid to travel due to concerns of contracting COVID, your travel insurance policy won't reimburse your trip.

The second portion of the typical travel insurance policy covers health costs if you're outside of your home insurance network while traveling. 

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