Squaremouth’s Guide to Credit Card Travel Insurance
Many travel credit cards include trip insurance to attract new members and provide existing cardholders with peace of mind when taking a trip. While this built-in coverage can be limited, it may be perfect for travelers that have lower trip costs or are heading to low-risk destinations.
As indicated by Forbes, travel insurance coverage can vary dramatically from one credit card to the next. Squaremouth breaks down credit card travel insurance, what it covers, and how it compares to third-party travel insurance.
How Does Credit Card Travel Insurance Work?
Credit card travel insurance is a popular perk that’s offered by many travel credit cards. This trip protection can provide you with reimbursement for unexpected travel expenses if your trip is disrupted by events out of your control, such as inclement weather, illness, or natural disasters.
The extent of financial protection you’re eligible for will depend on a wide-range of factors, such as the card you own, how you paid for your trip, and the circumstances surrounding your financial loss.
While some travel cards are free to attain, the cards that offer the highest level of coverage usually require an annual fee, which can range between $50-$700. To be approved for a travel credit card, the issuer may also need to verify that your credit score meets their minimum threshold.
What Does Credit Card Travel Insurance Cover?
The best travel credit cards come with travel insurance coverage that addresses the most common concerns of travelers. From lengthy delays to serious injuries, credit cards can offer travel insurance benefits that can protect you from the time you depart for your trip to the time you return.
Below are some of the most common travel insurance benefits offered by credit cards.
Cancellation Benefits
Trip Cancellation coverage is one of the main reasons travelers buy travel insurance, , and many popular travel credit card issuers include this coverage as part of their package of perks.
Typically, Trip Cancellation insurance can reimburse travelers their prepaid, non-refundable travel expenses if they are forced to cancel their trip for a covered reason, such as an illness, injury, or death in the family. Certain plans will also cover additional events such as severe weather, natural disasters, and terrorism.
There are two primary differences between Trip Cancellation coverage offered by credit cards and third-party insurance companies:
- Most credit cards only cover trips purchased on that card up to a specified amount, typically between $1,500 and $10,000 per trip. Most third-party travel insurance can cover 100% of prepaid and non-refundable trip costs, regardless of the cost.
- Some third-party policies offer the Cancel For Any Reason upgrade, which partially refunds travelers who cancel for a reason that is not otherwise covered by their policy. This is not an option when getting travel insurance through a credit card.
Medical Benefits
Since most primary healthcare plans don’t over coverage overseas, many travelers turn to travel insurance to cover any unexpected medical expenses that arise during their trip. Travel medical insurance can typically cover ambulance rides, hospital bills, and emergency evacuations.
Unfortunately, only a small number of travel credit cards offer medical insurance to their cardholders. Those that do provide this card benefit typically offer low coverage. If medical coverage is important to you, Squaremouth recommends considering a trusted travel insurance provider.
Travelers can purchase insurance plans that include high Emergency Medical and Medical Evacuation coverage without breaking the bank. On average, travel medical insurance plans from third-party providers cost roughly $90.
Luggage Benefits
Lost luggage can put a damper on any trip. Luckily, many travel credit cards offer strong coverage for personal items that get lost, stolen, or damaged during a trip.
Upon reviewing popular travel rewards credit cards, many offer up to $3,000 in baggage insurance. While a select few third-party travel insurance policies can cover up to $3,000, most offer between $250 and $1,000.
Although credit cards tend to offer a higher benefit amount, this coverage is usually limited to items that are lost or damaged while traveling with a common carrier, such as an airline. Third-party policies can cover items that are lost at any point during a trip.
Most third-party travel insurance plans also include Baggage Delay coverage, which can cover the cost of toiletries, clothing, and other necessities if your luggage doesn’t arrive to your destination on time.
Delay Benefits
Credit cards and third-party policies offer comparable coverage to reimburse travelers for meals and hotel accommodations during a significant delay. The Travel Delay coverage varies by policy, and eligibility is given once a specific period of time has passed, typically 3-12 hours.
Trip delay reimbursement also varies by plan. Most credit card insurance plans will provide but is between $100 and $1,000 per traveler. With that said, it’s important to make all meal and accommodation purchases with the credit card that offers the travel benefits.
Which Credit Cards Offer Travel Insurance?
Travel protection has become a popular differentiating factor for many credit cards, especially as the cost of travel continues to rise.
Below are a handful of popular credit cards at different price points that offer travel protection, as well as their coverage limits at the time this article was written.
| The Business Platinum Card From American Express | Chase Sapphire Reserve® | Capital One Venture X Rewards | Capital One Venture X Rewards | |
| Annual Fee | $695 | $550 | $395 | $95 |
| Trip Protection | $10,000 per trip | $10,000 per person, $20,000 per trip | $2,000 per person | $10,000 per person, $20,000 per trip |
| Trip Interruption | $10,000 per trip | $10,000 per person, $20,000 per trip | $2,000 per person | $10,000 per person, $20,000 per trip |
| Accidental Death & Dismemberment | N/A | $1,000,000 | N/A | $500,000 |
| Travel Delay | $500 per ticket, 6-hour delay minimum | $500 per ticket, 6-hour delay minimum | $500 per ticket, 6-hour delay minimum | $500 per ticket, 12-hour delay minimum |
| Baggage Delay | N/A | $100 per day for five days | N/A | $100 per day for five days |
| Baggage Loss | $3,000 per passenger | $3,000 per passenger | $3,000 per passenger | $3,000 per passenger |
| Rental Car Coverage | $75,000 | $75,000 | $75,000 | Up to the actual cash value of the car |
The above list is not a complete list of credit cards with travel insurance, but it does illustrate similarities and differences among cards at different annual fees. Most travel credit cards also come with additional perks like hotel credit, rewards, concierge services, and airport lounge access.
Credit Card Travel Insurance vs. Third-Party Travel Insurance
If you currently have travel protection from your credit card, you may not need additional coverage from a travel insurance policy.
However, if you’re insuring an expensive or adventurous trip, a comprehensive travel insurance policy from a third-party provider is still something to consider. Below we compare the differences between the two types.
| Credit Card Travel Insurance | Third-Party Travel Insurance | |
| Cost | Most travel credit cards require an annual fee, typically between $50-$700 | Travel insurance can be purchased for less than $100, but typically average around $300 per trip |
| Choice | Credit cards only provide one policy option to cardholders | Most providers offer multiple plans that offer varying degrees of coverage |
| Trip Costs | Credit cards will only protect expenses made through the credit card | Travel insurance plans can protect any trip investment, regardless of how it was made |
| Cancellation Coverage | Cards will provide a set reimbursement limit for trip cancellations and interruptions | Comprehensive insurance plans typically reimburse 100% of trip costs for covered cancellations or interruptions |
| Cancel For Any Reason | No credit card offers CFAR | Certain providers offer CFAR as an optional add-on at checkout |
| Medical Coverage | Credit cards typically do not provide medical coverage | Almost all travel insurance policies provide coverage for medical emergencies and evacuations |
| Delay Coverage | Most credit card insurance plans will provide between $100 and $1,000 per traveler after a 6-12 hour delay | Travel insurance delay coverage ranges from $250-$2,000 and may begin after a 3 hour delay |
| Luggage Protection | Many offer up to $3,000 in baggage insurance | Providers usually offer between $500-$3,000 in luggage protection |
What Type of Travel Insurance is Right for You?
To put it simply, credit cards are great for protecting some or all of your trip expenses, assuming they were made on your card. They can also provide great protection for your personal belongings while you travel.
Third-party insurance providers, however, are able to offer more options and coverage to travelers that need it. The key differentiator between credit card travel insurance and a policy you can purchase online is medical coverage. If you want health insurance while you travel, you may want to start comparing options.
No matter what you decide, it never hurts to compare your options for you leave for your trip. It’s not only free to shop, but you may find that travel insurance is more affordable than you expected.