Travel insurance reimburses you for covered trip cancellations, medical emergencies abroad and lost baggage. It costs 1.7% to 11% of your trip value, with most travelers spending $50 to $150 for a one-week trip. You buy coverage before your trip, file a claim when something goes wrong, and get reimbursed for covered expenses.
What Does Travel Insurance Cover and How Does It Work?
Travel insurance reimburses you for covered trip cancellations, medical emergencies abroad and lost baggage. It costs 1.7% to 11% of your trip value, with most travelers spending $50 to $150 for a one-week trip.
Updated: November 4, 2025
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What Travel Insurance Covers: Key Takeaways
Travel insurance covers six core benefits: trip cancellation and interruption, emergency medical care, medical evacuation, baggage protection, travel delays and pregnancy complications.
Coverage activates at different times. Trip cancellation starts the day after purchase, while medical emergencies, evacuation, baggage and travel delays only cover you during your trip.
Standard plans exclude pre-existing conditions without a waiver, high-risk activities like extreme sports and foreseeable events like named hurricanes. You'll need to add adventure sports coverage for activities like scuba diving or rock climbing.
Buy within 14 to 21 days of your initial deposit to access time-sensitive coverage like pre-existing condition waivers, cancel for any reason and primary medical coverage on select plans.
What Is Travel Insurance?
How Does Travel Insurance Work?
Travel insurance benefits activate at different times before and during your trip.
- 1Coverage effective dates
Trip cancellation coverage starts the day after you purchase your policy. Medical emergencies, evacuation, baggage coverage and travel delays only activate once your trip begins. Cancel for any reason coverage (if purchased within 14 to 21 days of booking) also starts immediately after purchase.
Late purchase: Most plans can be bought up to the day before departure, though time-sensitive benefits won't be available.
- 2Primary vs. secondary coverage
Primary coverage pays first, before your health insurance, meaning faster claims with no deductibles. Secondary coverage pays only after your regular health insurance processes its claim first, requiring you to file twice and wait longer for reimbursement. Most comprehensive plans offer secondary medical coverage, while premium plans include primary coverage.
- 3Filing a travel insurance claim
Contact your insurer within 72 hours for cancellations or as soon as possible for other claims. Document everything with photos, receipts, police reports for theft and medical records for health claims. Submit completed claim forms with original receipts and follow up if additional documentation is needed. Claims are typically processed within 10 to 30 days.
- 4Filing a travel insurance claim
If you need to file a claim:
- Contact your insurer immediately: Policies require notification within 72 hours for cancellations or as soon as possible for other claims.
- Document everything: Take photos, keep receipts, get police reports for theft and get medical records for health claims.
- Submit the required documentation: Completed claim forms, original receipts and invoices.
- Follow up: Stay in contact and provide additional documentation if needed.
- Receive payment: Claims are processed within 10 to 30 days.
What Does Travel Insurance Cover?
Comprehensive travel insurance policies cover:
- Trip cancellation protects your prepaid, nonrefundable costs if you can't travel due to illness, injury, death of family members, job loss, weather emergencies, natural disasters, terrorism or jury duty. Your coverage limit equals what you actually spent, so a $5,000 vacation gets $5,000 in coverage.
- Trip interruption covers you if you're already traveling but need to return home early for covered reasons. This pays 100% to 200% of your trip cost to cover unused expenses plus last-minute flights home.
Trip cancellation and interruption
Emergency medical coverage
Medical coverage pays for hospital bills, doctor visits, prescriptions and emergency dental care when traveling internationally. Your U.S. health insurance typically doesn't work abroad. Coverage ranges from $25,000 to $500,000 depending on your plan.
Medical evacuation and repatriation
Emergency evacuation coverage transports you to proper medical care or back home when local hospitals can't treat you. These medical flights cost $100,000 to $1 million.
Baggage and personal items
Baggage coverage protects lost, stolen, damaged or delayed luggage up to $1,000 to $2,500. This includes electronics, sports equipment like golf clubs or skis and personal items like passports.
Travel delays and missed connections
Delay coverage pays for hotel, meals and transportation when flights get canceled or delayed. It also covers costs to catch up with your cruise or tour if delays cause you to miss connections.
Pregnancy coverage
Pregnancy coverage covers complications only (pre-eclampsia, emergency C-sections, premature labor) but not routine prenatal care or normal childbirth. Learning you're pregnant is a standard reason for trip cancellation, depending on your policy, as long as you bought the policy before becoming pregnant.
Travel Insurance Optional Coverage Add-Ons
In addition to standard travel insurance coverage, you can purchase optional coverage add-ons, including:
Cancel for any reason (CFAR)
CFAR is the ultimate flexibility coverage upgrade for travel insurance. Cancel for any reason and get back 50% to 75% of your trip costs. You must purchase it within 7 to 21 days of booking, and it costs extra, but provides flexibility for trip changes.
Pre-existing medical conditions coverage
If you have ongoing health issues, pre-existing condition coverage is available if you buy early (14 to 21 days after booking). This includes coverage for heart conditions, cancer, diabetes and disability needs.
Long-term travel coverage
For extended trips, travel insurance coverage can be purchased as an annual or multi-trip policy.
Adventure sports and activities coverage
Standard policies exclude extreme activities like scuba diving and rock climbing, but you can add this coverage or buy a plan with adventure sports coverage included. World Nomads is the best option for this coverage.
What Is Excluded from Travel Insurance Coverage?
Standard travel insurance policies don't cover:
- 1Health-related exclusions
- Pre-existing conditions (unless you buy early and get a waiver)
- Mental health issues like depression or anxiety (though newer plans are starting to include coverage)
- Routine medical care, including vaccinations, prescription refills and elective procedures
- 2Activity and behavior exclusions
- High-risk activities: Extreme sports, professional athletics (unless specifically covered)
- Illegal activities: Drug use, criminal acts, traveling against government warnings
- Reckless behavior: Injuries from drinking and dangerous stunts
- 3Event-related and weather exclusions
- Known events: Hurricanes already named, ongoing wars and foreseeable political situations
- Foreseeable circumstances: If you could reasonably expect it to happen
- 4Travel destination exclusions
Countries or regions might not be covered due to government travel advisories, active war zones or civil unrest, and areas without adequate medical facilities.
Choosing the Right Travel Insurance Plan
Selecting the right travel insurance depends on your specific travel needs, budget and risk tolerance:
- 1Trip investment
How much non-refundable money have you spent? Higher investments justify more comprehensive coverage.
- 2Health status
Pre-existing conditions require early purchase for waiver eligibility. Consider higher medical limits for chronic conditions.
- 3Destination risk
Remote locations or countries with expensive medical care need higher coverage limits.
- 4Activities
Make sure your planned activities are covered or purchase additional protection.
- 5Travel frequency
Annual plans often make sense for travelers taking two or more trips per year.
- 6CFAR coverage
Consider adding CFAR coverage, which will allow you to cancel your trip and receive a 50% to 75% refund.
- 7Key coverage amounts
- Medical coverage: $50,000 to $100,000 for domestic and $100,000 to $500,000 for international travel. Pick higher limits for remote destinations or pre-existing conditions.
- Evacuation coverage: Minimum $500,000 recommended or $1 million for remote destinations.
- Trip cancellation: Should equal your total nonrefundable trip cost. Consider CFAR and trip interruption add-ons.
FAQ: How Does Travel Insurance Work?
Here are answers to common questions about travel insurance coverage, timing and how it works with your existing health insurance.
Can I buy travel insurance after I've already booked my trip?
Yes, but timing matters. You can buy it until the day before you leave, but to get the best benefits (like pre-existing condition waivers and cancel for any reason coverage), you must buy within 14 to 21 days of your first trip payment.
What's the difference between trip cancellation and trip interruption?
Trip cancellation covers you before you leave home, and if you can't go on your trip, you get reimbursed for what you spent. Trip interruption covers you if you're already traveling but have to cut your trip short and come home early. Interruption usually pays more (100% to 200% of the trip cost) because you need money for unused expenses and expensive last-minute flights home.
What counts as a pre-existing condition?
It's any medical condition you've been treated for, had symptoms of, or taken medication for within 60 to 180 days before buying your policy. This includes everything from diabetes to a sprained ankle you saw a doctor about last month.
Is travel insurance worth it for domestic trips?
It depends on your trip investment and risk tolerance. Trip cancellation coverage makes sense for expensive domestic trips with high nonrefundable costs (like that $5,000 family Disney vacation). Medical coverage is less critical since your regular health insurance works domestically, but you might still want coverage for trip delays and baggage issues.
Does my health insurance work when I travel abroad?
U.S. health insurance plans rarely cover expenses outside the country, including Medicare. Even if they do cover international emergencies, you'll need to pay upfront and get reimbursed later. Travel insurance with medical coverage can pay providers directly and covers things your regular insurance won't.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
He writes about economics and insurance, breaking down complex topics so people know what they're buying.