14 Common Travel Insurance Myths and Misconceptions

When it comes to planning a trip, whether domestic or international, several misconceptions about travel insurance arise. Some travelers believe that it is expensive, unnecessary and only for frequent travelers. Others say that it is only necessary for international trips, but this is a common misconception.

These myths can lead travelers to underestimate the importance of travel insurance and make them forgo coverage that could protect them from significant financial losses due to unforeseen circumstances.

In this article, we’ll clarify and debunk some of the most common myths and misconceptions. We’ll also explain the truth behind each and show why travel insurance is essential, and worth understanding.

MYTH #1: “I DON’T NEED TRAVEL INSURANCE. MY REGULAR INSURANCE COVERS ME ABROAD.”

Many travelers assume their home health plan will take care of them while they’re on vacation. In reality, your regular plan is designed for at-home care, not emergencies during your vacation or trips. Most domestic health plans offer little to no coverage abroad. The U.S government, for instance, states that they don’t pay for medical, hospital or ambulance costs for U.S citizens once they leave the country.

Private insurers will also not pay for treatment outside your home country.

In summary, ALWAYS buy travel insurance for your international trips. It reimburses emergency care, hospital stays, and even evacuation. Without it, you could end up a multi-thousand dollar bill that will not be paid by your domestic plan.

MYTH #2:”TRAVEL INSURANCE IS ONLY FOR INTERNATIONAL TRIPS.”

Some travelers think they’re safe without insurance if they’re on vacation close to home. This is false. Domestic travel can also face risks like lost luggage, flight delays, medical emergencies, or even trip cancellations.

Without insurance, a planned family vacation whose flight is cancelled due to bad weather can cost you your flights and hotel, and your regular health insurance won’t reimburse your trip interruptions or delays.

In short, don’t write off insurance just because you’re not flying outside your country. The same financial challenges apply at home.

MYTH #3: “MY CREDIT CARD PROVIDES FULL TRAVEL COVERAGE.”

Although many travel credit cards offer some perks, like rental car or baggage insurance, their cover is usually limited and narrow. For instance, they may not cover big emergencies like medical evacuation or pre-existing conditions.

Credit card policies are not customized travel plans. The card’s coverage is secondary, and only pays after you’ve made a claim on your primary insurance (auto or homeowner).

Most credit cards also require you to charge your entire trip to the card and then submit extensive documentation for any claim.

In summary, always read the fine print on your card benefits. Use them as a backup, but consider purchasing a dedicated travel insurance coverage. It’s simpler, cheaper and tailored to your needs.

MYTH #4: “TRAVEL INSURANCE AUTOMATICALLY COVERS EVERYTHING.”

Travel insurance is not by default “all inclusive”. Each plan clarifies what is covered and what is excluded. Common exclusions include pre-existing medical issues (unless declared), pandemics, traveling to destinations with political instabilities, extreme sports, or anything done under the influence of alcohol or drugs. Key exclusions vary by insurer.

Remember, no policy covers every situation. Always read exclusions before you buy. If you need coverage for something unusual, like a high-risk activity, for example, look for an insurance plan that specifically lists that scenario.

MYTH #5: “YOU CAN WAIT UNTIL AFTER YOU GET HOME TO FILE YOUR CLAIM.”

Travel insurance claims have strict deadlines. They won’t wait until you get home. Often, you must report incidences promptly after an incident, sometimes even days after the event. Many insurance plans, for example, require a written claim within 20 days after something happens, accompanied by supporting documents to be submitted soon after.

Some benefits, like trip cancellation, expect you to notify the insurer within 48 hours if a covered event forces you to cancel a trip.

ProTip: Keep receipts, police filings, medical reports and official reports from the scene. Always inform your insurer as soon as something happens. Treat it like a time sensitive transaction. 

MYTH #6: “PRE-EXISTING CONDITIONS WON’T BE COVERED.”

It’s true that undisclosed pre-existing conditions are often excluded. Many travel insurance plans will, however, cover known and stable conditions if you apply early and meet their criteria. If you fail to declare a condition, any related claim will be denied.

It’s also important to seek plans that cover your specific condition.

In summary, don’t automatically assume a health issue will disqualify you. Many travelers with heart conditions and diabetes get covered by disclosing it and choosing the right plan.

MYTH #7: “BAGS AND VALUABLES ARE ALWAYS COVERED.”

Travel insurance usually includes baggage coverage, but it comes with limits. Most plans have a reimbursement cap from $500-$ 1,500 per item. Items above that, like a $3,000 camera or laptop may not be fully insured unless you declare them.

Insurers also often exclude loss from baggage that was unattended. For example, if you lost a bag of valuables because it was unattended, your claim will be denied.

In summary, if you’re traveling with expensive equipment, consider insuring it separately, or choosing a plan with higher baggage limits. World Nomads insures valuables up to $3,000 on some plans.

ProTips: Watch your belongings, and keep receipts for expensive gear. Without proof of value, you may only get a token amount or repair cost in cases of damage.

MYTH #8: “AIRLINES WILL COMPENSATE ME FOR DELAYS OR CANCELLATIONS.”

By law, airlines must refund or rebook if your flight is significantly delayed or cancelled. But the expenses such as your meals, hotel accommodation or alternate transport arising from the delays or cancellations are not typically reimbursed by the airlines unless you have travel insurance.

With travel insurance, trip delay coverage will be reimbursed reasonably when you’re delayed more than a certain number of hours.

In short, don’t expect an airline to take care of everything. If you rely on your own resources for a delay, those costs can add up. But travel insurance will reimburse you if it falls under your policy.

MYTH #9: “ADVENTURE SPORTS AND OTHER HIGH-RISK ACTIVITIES ARE INCLUDED.”

Standard policies usually exclude adventure sports and other high-risk activities. That means activities like scuba diving, skiing, sky diving, bungee jumping, hang-gliding, high-altitude trekking, and other risky sports are not covered unless you purchase a specific activity cover.

Insurers like World Nomads allow you to cover over 200 activities in their database. So before you jump out of a plane, read the fine print.

MYTH #10: “TRAVEL INSURANCE IS EXPENSIVE.”

Travel insurance is surprisingly quite affordable, often 4-10% of your trip cost. This means that on a $3,000 vacation, you might pay $120-$300 for comprehensive coverage. When you compare this to a $15,000 hospital bill or $2,500 wasted on a cancelled cruise trip, travel insurance will seem like a bargain.

Policies are also customizable and you only pay for what you need. For instance, you don’t need to pay for rental car coverage if you won’t need to rent a car.

In short, paying a few hundred dollars in form of travel insurance is an inexpensive way to protect a much bigger investment and provide peace of mind against worst-case scenarios.

MYTH #11: “HIGHER PREMIUM MEANS BETTER COVERAGE.”

A higher premium amount doesn’t automatically guarantee you the “best” insurance coverage. It depends on your needs, not your premium. Two policies can cost the same amount, say $500, but cover very different things. The key is to compare benefits and limits, not just price.

Sometimes, a policy with a higher premium may simply include extras you don’t need, while a cheaper one might cover exactly what your trip requires. Choose an insurance coverage that is based on your actual need. Look at deductibles, exclusions and coverage limits. A slightly cheaper plan with the right benefits can save you some money rather than assuming the most expensive plan is the best.

ProTip: Customize your cover to your needs and itinerary and use a comparison site or an agent to ensure you get what you need without any unnecessary extras.

MYTH #12: “MY CREDIT CARD COVERS RENTAL CAR DAMAGE.”

Credit card coverage is usually secondary and limited, but may offer some rental coverage and can reimburse car damage only after your own personal auto insurance pays first.

It rarely covers damage to other cars, properties or injuries (liability).

You must charge the rental to the card and decline the rental company’s insurance to trigger card coverage. They also exclude certain vehicles like vans, trucks and luxury cars.

For full protection, consider buying primary rental coverage via your travel insurance because your credit card won’t cover medical bills or the other driver’s losses.

ProTip: Don’t rely on your card 100%, have it as a backup. Having rental car insurance to your travel plan ensures broader, primary coverage and peace of mind. 

MYTH #13: “CRUISES AND PIRACY ARE FULLY COVERED BY STANDARD TRAVEL INSURANCE.”

Many standard policies don’t cover cruising fully because it has unique risks. It’s treated like any other trip. It might cover personal accidents or missed port fees, but typically exclude cruise specific problems like onboard outbreaks or piracy. Such scenarios often require cruise insurance coverage or specialized marine insurance.

Bad weather or mechanical issues, rerouting or delaying the ship can incur extra costs, like missed paid excursion that basic insurance might not reimburse.

ProTip: Always check if your policy specifically covers cruises. Many insurers treat cruises as excluded, unless added which may need you to pay extra.

MYTH #14: “LONG TRIPS OF OVER 60 DAYS ARE COVERED BY STANDARD PLANS”

Most standard travel policies have a maximum trip length of between 30-60 days. Allianz’s popular multi-trip plan covers up to 45 days per trip. If you have an extended adventure, choose a long-term or renewable plan. World Nomads, for example, offers up to 180 days, and SafetyWing’s plan lets you renew monthly for up to a year with each trip being up to 45 days in length.

ProTip: Read the “Duration of Coverage” closely, exceeding it voids your coverage. If your journey is longer than a policy’s maximum, get a plan that will support your trip duration

CONCLUSION.

By debunking these myths, the goal is to empower you to pick the right protection for your trip because travel insurance is as valuable as your understanding of it. Remember to always read the policy and match them to your travel style and needs. If you’re an adrenaline junkie, make sure your activity is covered, and if you’re a long-term traveler, go for the correct trip-length plan.

If you found this guide helpful, consider supporting us by checking out World Nomads and SafetyWing for your next trip. They’re popular with travelers and often cover exactly the scenarios covered here.

Safe Travels!

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