Is travel insurance worth it?

When to buy—and when to skip it.

Written byDavid Schepp

Fact-checked byThe Editors of Encyclopaedia Britannica

Updated: Nov. 3, 2026

Editor’s note: This article first appeared in Money Matters, a newsletter from Britannica Money, on April 5, 2026.

Commercial airplane descending with a large green parachute against a stylized background with clouds and patterned border.

A little protection for your big trip.

If you’ve ever booked your own travel, you’ve probably felt price creep. You start with a bargain-priced flight, only to watch the fare climb when you opt to avoid a layover. Returning home at a humane hour costs more, too. Add a better seat or a checked bag, and suddenly your $500 cheapie fare is soaring toward quadruple digits, and you haven’t even looked at a rental car or hotel.

By the time you reach the final checkout screen, travel insurance feels like one more drip in a steady stream of upgrades and add-ons. It may be only a small percentage of your trip, but after everything else, it can feel like the bill that breaks the budget.

Whether it’s worth the added cost depends on what you stand to lose—and what you’re actually getting in return.

4%–7%

The typical cost of a standard travel insurance policy as a share of your total trip price.

What travel insurance typically covers

A standard travel insurance policy bundles several types of protection, although coverage limits vary.

Trip cancellation and interruption coverage reimburses prepaid, nonrefundable expenses—such as flights, discounted hotel stays, and prepaid tours—if you can’t travel for a covered reason, including illness, severe weather, or a death in the family. Some policies reimburse the full trip cost; others don’t.

Medical coverage pays for emergency care if you become ill or injured while traveling. These policies can be especially important overseas, where most U.S. health plans, including Medicare, offer little or no coverage.

Emergency evacuation coverage helps pay to transport you to the nearest appropriate facility or back home if necessary. Evacuations can cost tens of thousands of dollars, particularly from remote destinations or cruise ships.

Other benefits may include reimbursement for lost or delayed baggage, missed connections, and travel delays. Optional upgrades, such as “cancel for any reason,” provide more flexibility but also add to the cost.

When skipping insurance makes sense

Travel insurance adds cost at a time when you may be trying to stay on budget. In some situations, that extra expense may not meaningfully reduce your financial risk, especially if your trip is inexpensive or largely refundable:

Low-cost trips. If airfare and lodging are modest and easy to cancel, the added cost of insurance may not buy you much protection and could be a waste of money.
Domestic travel. For shorter domestic trips, refunds, credits, or alternative travel options may limit your losses without a separate policy.
Credit card benefits. Many credit cards include trip delay, cancellation, and baggage protections when you pay with the card. Overlapping coverage may make a stand-alone policy unnecessary.
Flexible bookings. Refundable fares and hotel rates already reduce your exposure. If you can cancel without penalty, additional insurance may be unnecessary.

Decide before you book

Depending on how soon you’re traveling, the price of a policy may not change if you wait to purchase. Buying early matters mainly when certain benefits are available only within a limited time frame.

Calculate potential losses. Add up your nonrefundable costs—airfare, hotel deposits, tours, cruises, even a prepaid rental car. The larger the total, the more worthwhile travel coverage may be.
Check for deal-breakers. Before buying a policy, confirm it covers what matters most to you, whether that’s a favorite activity or the ability to cancel if you get sick. If it’s not clearly listed, assume it’s not covered.
Compare medical caps. If you’re traveling abroad, review emergency medical and evacuation limits. Low-cost policies sometimes skimp on these benefits.
Buy early if needed. Some benefits—such as coverage for preexisting conditions—are available only if you purchase insurance within a set window after your first trip payment.

Balance cost and risk

Travel insurance isn’t about fear. It’s about math. If the premium meaningfully reduces what you stand to lose, it may be worth it. If not, skipping it may make the most sense.

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This article was most recently revised and updated by David Schepp