Do You Need Travel Insurance if You Have a Travel Card?

by Maurie Backman | Nov. 30, 2019

The Ascent is reader-supported: we may earn a commission from offers on this page. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation.

The quick answer: sometimes.

Occasionally, even the best thought-out travel plans can go awry, and often through no fault of your own. Your flight can get delayed, or you can miss a connection. Your baggage could get lost, leaving you scrambling once you reach your destination. Or, you could get sick, and therefore need to cancel your trip, cut it short, or receive medical care during your stay. 

It's for these reasons that travelers are usually advised to purchase insurance to protect themselves financially from such hiccups. Often, for a modest fee, you can buy a travel insurance policy for a specific trip that compensates you if you're forced to change your plans, or things go wrong that cost you money. 

A person walking through an airport with their suitcase.

Image source: Getty Images

To give you a sense of what travel insurance costs, a $1,000 stay at an all-inclusive resort can be insured for a mere $85. That premium includes coverage for trip delays, lost luggage, and even medical issues that arise overseas. 

But what if you use a travel rewards credit card to book your trip? Many of these cards offer some degree of travel protection. The question is: Do they offer enough protection for you to skip the insurance?

It pays to secure the right coverage

Inadequate travel insurance could result in financial losses that are painful to bear. By contrast, a travel insurance policy will generally cost somewhere between 4% and 10% of the price of your trip. And while your travel rewards card may provide some coverage, you'll likely secure a higher level of coverage by buying an actual policy. 

That said, you'll need to review the benefits associated with your specific credit card to see whether it pays to buy travel insurance. For example, you may have a credit card that offers several thousand dollars of coverage for trip delays. But if that same card doesn't offer a medical evacuation benefit, or emergency medical and dental benefits, then you could be out a fortune in the event you need them during your travels. 

Keep in mind that many U.S. health insurers won't actually pay for medical treatment overseas, and it's uncommon for them to cover the cost of a medical evacuation back to the U.S. Therefore, you'll need to carefully assess the benefits your travel card gives you to determine whether they provide the coverage you need. If not, buying separate travel insurance could really pay off. 

Another thing you should know is that many travel insurance policies these days offer a "cancel for any reason" benefit. If you're not sure you'll be able to make your trip -- say, it's smack in the middle of a busy period at work, or you have an ailing relative whose situation is rather precarious -- then that's an option you'll probably want to have. 

What's the right choice for you?

If you're not worried about medical coverage during your travels (say, because you're taking a domestic trip), or your travel credit card offers a wide range of protections that include medical coverage, then you may be able to skip the travel insurance. But if you're at all concerned that your card's coverage won't suffice, then it could be in your best interest to buy travel insurance and get the peace of mind that comes with it. 

Our credit card expert uses the card we reveal below, and it could earn you $1,148 (seriously)

As long as you pay them off each month, credit cards are a no-brainer for savvy Americans. They protect against fraud far better than debit cards, help raise your credit score, and can put hundreds (or thousands!) of dollars in rewards back in your pocket each year.

But with so many cards out there, you need to choose wisely. This top-rated card offers the ability to pay 0% interest on purchases until late 2021, has some of the most generous cash back rewards we’ve ever seen (up to 5%!), and somehow still sports a $0 annual fee.

That’s why our expert – who has reviewed hundreds of cards – signed up for this one personally. Click here to get free access to our expert’s top pick.

About the Author