I’ve got a trip coming up. Do I need travel insurance?

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Just in case your plans go south.

© derek, Who is Danny/stock.adobe.com; Photo illustration Encyclopædia Britannica, Inc.

Taking out travel insurance is akin to a doomsday scenario: You’re hoping for the best but planning for the worst.

Sometimes, however, that’s just what you should be doing, especially if it’s an international or once-in-a-lifetime trip you’ve been looking forward to—and saving for—for years.

What if:

You can’t see into the future, but you can see your budget—and the costs of flights, lodging, excursions, meals, transportation, and all the tchotchkes you’ll bring home.

With so much at stake, is it worth the risk? The answer is: It depends. But if you’re leaning toward getting coverage, a general guideline is to spend 4% to 7% of the total cost of your excursion on a policy, according to Squaremouth, a travel insurance comparison site. Premiums can vary with traveler age, destination, and coverage level, and have generally risen as more people choose policies with medical or evacuation add-ons.

And always read the fine print to ensure your needs and concerns are addressed. There’s nothing worse than paying for travel coverage, enduring an interruption to your trip, only to be denied reimbursement because of a limitation or exclusion you didn’t know about.

As with any other insurance policy, there’s peace of mind in knowing you’re covered in that worst-case scenario. But policies aren’t all alike, and costs will depend on where you’re going, how long you’re staying, how much you’re paying to travel, how valuable your luggage is, and your age and overall level of health.

Most plans now include pandemic-related coverage or optional upgrades such as “cancel for any reason” and coverage for adventure sports such as skiing, white water rafting, or zip-lining. Some policies will cover multiple trips over a specific time period such as one year.

There are five basic policy groups to consider, according to syndicated columnist, tour guide, and travel expert Rick Steves:

You can also add supplemental policies, such as coverage for identity theft, political evacuation, or accidental death, if you want additional protection. The U.S. Department of State strongly recommends purchasing travel insurance for trips abroad. Most U.S. health plans, including Medicare and Medicaid, offer little or no coverage overseas, and almost none cover costly emergency evacuations back to the U.S.

Carefully consider what’s important to you—whether it’s a full reimbursement for a trip cancellation or medical coverage should anything happen—and what kind of coverage you might already have. Some trip cancellation policies, for example, might cover only 50% of the total costs.

Since COVID-19, which upended tens of thousands of trips when worldwide shutdowns were ordered, many plans now include cancellation coverage should you get sick with the virus ahead of time. Some include medical coverage should you get infected while traveling.

The U.S. government says to make sure your health coverage includes medical transport back to the U.S., a 24-hour contact line, the regions you’re traveling in, preexisting conditions, and any activities you plan on engaging in, such as hiking or mountain climbing.

Say you and a companion (both in your early 50s) are planning an eight-day, four-city trip to Portugal in 2026, with a total budget of about $10,000. It may be worth insuring that investment in case something goes wrong before or during your travels. But what should you expect to pay?

A search on Squaremouth for such a trip from Chicago turned up policies ranging from about $300 per traveler to just over $1,100. The wide range reflects what’s included:

The pricier policy offers much broader protection, especially for medical and evacuation costs, while the budget option focuses mainly on trip interruption and delay.

If you’re taking an expensive international trip, it’s wise to choose a reputable company, according to Steves. He recommends using comparison sites like Squaremouth or InsureMyTrip to find trusted providers, rather than buying from an unknown company you stumble upon online.

Squaremouth advises buying a policy about 60 days before your trip, when unexpected events are more likely to arise but coverage is still available.

In general, it doesn’t cost more to add insurance early. But if you’re waiting until the last minute because you’re concerned about the weather, geopolitics, or your health, you risk missing out on coverage. Some insurers won’t write last-minute policies. For instance, in the Portugal example, some benefits were covered only if the policy was bought by a certain date—usually two months before takeoff.

Insurance companies, which underwrite those risks, are monitoring the same conditions you are. So if you see an event unfolding, and you hope to quickly add insurance to your trip, you might be too late. For example, after the January 2025 wildfires in the Los Angeles region began, many insurers stopped issuing new travel policies for affected areas. Back in 2023, tourists traveling to Greece couldn’t get travel insurance once the wildfires began on the islands of Rhodes and Corfu.

It depends. Let’s start with the average cost of travel insurance—about 4% to 7%, depending on your destination, age, and general level of health. It might be worth covering an expensive or faraway trip, as it represents a significant investment of money and time, with the potential for memorable experiences.

But what if you’re flying within the U.S.? Domestic airlines may or may not cover delays because of weather or overall air congestion. (Again, read the fine print.) If a canceled flight from Chicago to Miami means you’re missing an entire cruise or a family reunion with members converging from different spots, there might be no margin for error. A 5% cancellation fee on a $288 flight, or roughly $15, might be considered money well spent.

But if you’re flying into Chicago from, say, Charlotte, North Carolina, maybe the worst-case scenario is you toss your luggage in the backseat, drive for 10 hours, and pay to park for a week. And if that cancellation is the airline’s fault, you’ll at least get your flight credit.

Taking a cruise? Pay close attention to what an insurance policy would cover. Your ship will stop in several ports of call, often in different countries, and sometimes in remote places with few medical facilities or no airport nearby. Because the cruise line specializes in this type of travel, its add-on insurance policy could be well-suited to your needs. But cruise lines typically work with only one insurance company, which means the premiums could be higher than those of third-party providers, which compete for your business.

The ease-versus-best-price argument extends to your airline as well. When you purchase your flight, adding insurance is just a click away. But are you overpaying? If you want to find the best deal, shop around. But if it’s a low-cost, low-risk policy, the difference might be only a few bucks, and thus not worth the hassle. Time is money.

In fact, many do. Before you purchase travel insurance, check what your credit card provider offers. Not all credit card protections are alike. Some might cover trip cancellation and interruption, while others just offer trip delay insurance to help you take care of your most pressing needs.

You might get reimbursed for lost or delayed luggage, and some credit cards even offer travel accident coverage. Typically, you must use that credit card to pay for all or most of a trip in order to be eligible for reimbursement, and you need to hang onto those receipts.

And as with anything you sign, read the fine print so you know what’s covered and what’s not. And if your card’s protection falls short, a stand-alone policy can fill the gaps—especially for medical care or emergency evacuation overseas.

Travel insurance is like most money matters, not to mention games of chance: Balance the parameters against the odds, and do the math. You can usually find the answer that works for you.

For the right trip, travel insurance isn’t about betting against bad luck—it’s about capping the cost of chaos.

Specific companies are mentioned in this article for educational purposes only and not as an endorsement.