There are a few things to consider when determining which of travel expenses to insure when purchasing a travel insurance policy.
First of all, when travel insurance providers refer to the cost of a trip, they are usually referring to the prepaid, non-refundable travel arrangements that were purchased prior to departure. A good way to think of trip cost is to consider the amount of money a traveler would lose if they had to cancel a trip.
Many travelers choose to insure 100% of these expenses. This is recommended for travelers with a single trip policy that includes Trip Cancellation benefits. If they cancel for a covered reason on the policy, they can be reimbursed their full trip cost.
Additionally, some policies will require travelers to insure 100% of these prepaid, non-refundable expenses. This is typically the case when the policy includes specific benefits such as:
When deciding which expenses to insure, keep in mind that it is not necessary to insure refundable expenses. The lower the amount of trip expenses you insure, the lower your premium will be. Understanding the definition of trip cost and considering which benefits are affected by it will help travelers select the right coverage.