What Type of Travel Insurance do You Need? Different Plans Explained

What Type of Travel Insurance do You Need? Different Plans Explained

There’s a stark reality to traveling abroad that few of us don’t think about until it’s too late. The unthinkable will inevitably happen. Tornados, hurricanes, assaults, robberies, illnesses, travel delays, and more will temporarily and sometimes permanently hinder our travel plans. All of these possibilities mean that nobody should travel without travel insurance.

On average, 1 in 6 Americans who take out travel insurance will likely file a claim with their insurer in the coming year, according to the United States Travel Association.

Just look at the following circumstances and try telling yourself these things will never happen to you while traveling:

  • On an Amazon cruise in Brazil, a woman’s lungs fill with fluid, necessitating hospitalization.
  • A man in Cuba walks out of his hotel and falls to the ground after having a mild stroke, requiring extensive medical care.
  • In Italy a man trips and falls, breaking his hip.
  • A traveler in England finds herself suddenly stricken with an unknown illness that renders her unable to travel back home for medical care.
  • In Germany a woman fractures her ankle stepping off her tour bus onto a cobblestone street.
  • In Thailand a man is hit by a scooter as he walks, injuring his knee and hip.
  • In Japan a woman trips and falls on stairs, fracturing her toe.
  • A vagabond traveler is robbed on-route to the airport and has no money to replace his travel documents and plane ticket.

The above are just a few situations where travelers find themselves in need of medical or financial help in a foreign country.

Comprehensive Travel Insurance

Other names: Trip Insurance, Vacation Insurance, Comprehensive Trip Insurance, Trip Cancellation Insurance, or simply Travel Insurance.

Insurers could use any one of these labels to describe their comprehensive package, but all offer pretty much the same coverage: cancellations, interruption, hurricanes, medical emergencies, evacuation, lost, stolen, and delayed baggage, and others.

This is by far the most common type of travel insurance. It’s what most people think of when they hear the term travel insurance. Comprehensive travel insurance is also the only type of plan that offers cancellation coverage, to protect you when a prepaid trip needs to be cancelled for unforseen reasons.

Comprehensive package plans suit the following types of travel:

  • Cruises
  • Vacations & general travel
  • Family trips
  • Domestic or foreign travel
  • Travel to seedier locations where robbery is a major concern
Choosing the right travel insurance

Image Credit: CRZA/Flickr

Travel Medical Insurance

Other names: Travel Health Insurance, International Medical Insurance, and International Travel Insurance.

Just as the name would suggest, travel medical insurance covers you for medical emergencies of all kinds that can happen abroad. This is the second most common type, and while it won’t cover you for everything that can happen, it certainly covers most or all of the costs of medical care abroad, if you’re unable to immediately return home for care.

Most of the common and some less common costs are covered: medical emergencies, accidents, emergency evacuations, and repatriation. Some plans will offer some comprehensive benefits, but only if those costs are a result of your medical emergency.

Consider the following statistics related to medical emergencies while traveling (source):

  • Falls and bone fractures factor into about 42% of medical emergencies, often leading to the most serious health issues abroad.
  • Heart attacks and strokes make up approximatly 22% of overseas medical emergencies.
  • The balance of some 36% of medical emergencies are a variety of minor problems, such as cuts, bruises, and digestive issues.

Travel Medical plans are suitable for the following types of travel:

  • Vacations
  • Business trips
  • Long-term work or study in a foreign country
  • Expats living abroad

Medevac Insurance

Medevac coverage goes by no other name.

This type of coverage is for people planning trips to areas where being trapped by the elements or seriously injured is a very real possibility. Whether you need a helicopter, plane, train, or other speciality extraction from wherever you’ve been trapped and/or injured, Medevac will come to the rescue. It will however, only cover the cost of the extraction to get you to the nearest hospital; not any medical care or other assistance you need once the extraction is done.

Medevac plans are frequently used by:

  • Cruise travelers who don’t have medevac coverage built into their package (think Titanic here)
  • Travelers visiting remote locations
  • Travelers engaging in extreme sports of all kinds
Tips for choosing travel insurance

Image Credit: Gerald Davison/Flickr

Annual Plans

Annual insurance plans are made up of a combination of the coverage mentioned so far, tailored to the needs of individual travelers. With an annual travel plan, a policy holder is covered for the entire year, normally paying monthly premiums to the insurer.

Annual plans are best suited to:

  • Frequent travelers
  • Business travelers
  • Any traveler making multiple trips per year

Specialty Plans

Specialty plans also carry some built in flexibility and are tailored to individual travel needs such as car rental, term life, and other types of coverage not built into comprehensive , medical, or Medevac coverage.

Specialty travel insurance plans cover things like:

  • Corporate Kidnap, Ransom and Extortion
  • Car rental collision coverage
  • Term life insurance coverage
  • Medical tourism protection
  • Travel risks specific to the area you’ll be traveling in

Post any other questions you have about selecting the right kind of travel insurance in the comments and I’ll do my best to answer them.

Main Image Credit: Moyan Brenn/Flickr

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