Is Travel Insurance Worth It?
Key Takeaways:
- Travel costs continue to climb, with the average trip costing more than 35% more today than it did just five years ago.
- Travel insurance helps protect that investment by covering common disruptions like trip cancellations, medical emergencies, travel delays, and lost or delayed baggage.
- Coverage doesn’t have to break the bank, with some policies averaging as little as $5 per day, depending on your trip details.
- Trip protection is especially valuable for higher-risk travel, such as cruises, adventure activities, or visits to remote or international destinations.
- Comparing travel insurance plans through a marketplace like Squaremouth makes it easy to evaluate multiple providers at once and find the best coverage for your specific trip.
Travel is more expensive than ever. Squaremouth data reveals that the average trip costs roughly 35% more than it did just five years ago. As we invest more in flights, accommodations, and excursions, the financial impact of a canceled flight, medical emergency, or major delay can be significant.
While travel insurance may feel like an optional expense or an unnecessary add-on, getting covered ahead of your next trip can add valuable peace of mind and save you thousands in the event your trip is disrupted. Understanding when travel insurance adds real value can help you decide if it’s a good fit for you.
What Does Travel Insurance Cover?
Whether you face an inconvenient flight delay heading to your destination or a severe medical emergency that requires immediate attention, travel insurance has you covered. The majority of travel insurance customers opt for comprehensive coverage, which provides the most robust protection against the unexpected.
Below is a list of popular benefits found in comprehensive travel insurance plans:
| Travel Insurance Benefit | Benefit Description | Coverage Range |
| Trip Cancellation | Trip Cancellation coverage can reimburse up to 100% of your prepaid, non-refundable travel expenses (such as airfare, hotels, and tours) if you’re forced to cancel your trip for reasons outside of your control. | $5,000 – $100,000 per person |
| Trip Interruption | Trip Interruption can reimburse 100% – 150% of your prepaid, non-refundable trip costs if you’re forced to end your trip early due to a covered reason. | $5,000 – $150,000 per person |
| Emergency Medical | Emergency Medical coverage reimburses you for unexpected medical expenses incurred during your trip, such as hospital stays, doctor visits, and prescription medication costs. | $10,000 – $2,000,000 per person |
| Medical Evacuation | Medical Evacuation covers the cost to transport you to the nearest adequate medical facility or back to your home country to receive necessary treatment. | $50,000 – $2,000,000 |
| Travel Delay | Travel Delay reimburses meal, accommodation, and local transportation expenses if your flight, cruise, or other common carrier is significantly delayed due to inclement weather, mechanical breakdown, or other covered reasons. | $100 – $5,000 per person |
| Missed Connection | Missed Connection coverage covers the cost to make new travel arrangements if you miss a connecting flight or cruise departure due to a previous delay in your trip’s itinerary. | $100 – $2,000 per person |
| Baggage Loss | The Baggage Loss benefit reimburses the actual cash value of luggage or personal belongings that get lost, damaged, or stolen during a covered trip. | $250 – $3,000 per person |
| Baggage Delay | Baggage Delay can cover the cost to purchase a change of clothes, toiletries, and other essentials if your luggage is delayed en route to your final destination. | $100 – $750 per person |
| Accidental Death & Dismemberment (AD&D) | AD&D is a benefit that provides a one-time payment to a beneficiary in the event you or a travel companion suffers loss of life or limb during a covered trip. | $10,000 – $100,000 per person |
How Much Does Travel Insurance Cost?
Quality travel insurance doesn’t have to be expensive. Squaremouth data shows that the average cost of travel insurance in 2026 is $307 per policy, with an average trip length of 15 days. This means that, on average, travelers spend $20 on travel insurance for each day they travel.
The cost of your coverage largely depends on the type of policy you purchase. Typically, comprehensive travel insurance costs 4-10% of your insured trip costs. For example, if you are taking a $5,000 vacation to Mexico, you can expect to pay between $200 to $400 for comprehensive coverage.
For more affordable coverage, you can opt for travel medical insurance. This is a type of coverage that foregoes cancellation coverage in exchange for lower premiums and strong medical protection.
See how premiums for the two types of coverage compare below:
| Type of Policy | Average Premium Cost | Average Trip Length | Average Cost Per Day |
| Medical-Only Travel Insurance | $86 | 18 | $5 |
| Comprehensive Travel Insurance | $426 | 14 | $30 |
What Makes Travel Insurance More Expensive?
Travel insurance providers calculate premiums independently based on their target demographic — the customers they want to buy their insurance. In addition, providers review historical and statistical information, known as actuarial data, to understand their risk of paying a claim, and then set basic premiums for different types of coverage. The actual premium an individual traveler pays is calculated by using specific factors related to them and their trip.
As a result of differing target demographics and actuarial data, the premiums charged by providers and the coverages offered in their plans vary.
Key Factors That Increase Travel Insurance Premiums
Regardless of the provider, some key factors can increase the cost of travel insurance premiums:
- Trip Cost: Your trip costs are a major factor in determining your premium, with an expensive trip typically requiring a higher payment.
- Trip Length: It can cost more to insure a longer trip than a short one because there is an increased risk that some type of travel disruption will result in a claim.
- Traveler Ages: Because older individuals are generally considered to be more at risk for health issues, premiums often rise with the age of the traveler.
- Coverage Amounts: Plans that offer higher coverage amounts will sometimes cost you more than plans with minimum coverage amounts.
Other Factors That Could Affect Travel Insurance Premiums
Some additional factors can, in some instances, add to the cost of your travel insurance:
- Destination: Travel locations that are remote or considered high-risk based on travel advisories issued by the U.S. Department of State will increase premium amounts.
- Upgrades: Adding optional coverages like Cancel For Any Reason (CFAR) and Interruption For Any Reason (IFAR) will increase the premium you pay for travel insurance.
- Providers: Some travel insurance premiums are higher than others because each provider sets their own pricing based on their individual target demographic.
- Plan Levels: For providers with tiered prices, as the coverage increases, so does the premium cost.
How Much Does Travel Insurance Reimburse Travelers?
If you’re spending hundreds of dollars on your policy, you want to be sure that you will be meaningfully reimbursed if something goes wrong during your trip. Fortunately, most travel insurance plans found on Squaremouth offer well-rounded coverage that can help offset the financial impact of cancellations, medical emergencies, delays, and other covered events.
According to internal Squaremouth data, the average travel insurance claim payout in 2025 was just over $2,000. For context, the typical claim payout is roughly seven times higher than the average travel insurance premium. In many cases, a single covered disruption can result in reimbursement that far exceeds the cost of the policy, helping travelers avoid significant out-of-pocket expenses when plans don’t go as expected.
When Is Travel Insurance Worth The Money?
While it’s always wise to travel with insurance, it becomes especially important when your trip involves added financial, logistical, or medical risk.
Below are common scenarios where travel insurance can provide meaningful protection and help limit out-of-pocket expenses if plans change:
International Trips
Medical care abroad can be expensive, and many domestic health insurance plans, like Medicare, offer limited or no coverage outside the U.S. Travel insurance can help cover emergency medical treatment, evacuations, and other trip disruptions while overseas. See a list of our favorite international travel insurance plans.
High-Cost Trips
If you’ve prepaid a significant amount for flights, accommodations, tours, or cruises, travel insurance can help protect that investment if you’re forced to cancel or interrupt your trip for a covered reason. Without the proper coverage, your travel expenses could be lost if you’re unable to travel as planned.
Cruises
Cruises often involve strict cancellation policies, fixed departure schedules, and limited access to medical care at sea. Travel insurance can help cover missed ports, medical treatment onboard, and emergency evacuations to the nearest hospital on land. For help finding our plan, see our list of the ‘Best Cruise Insurance Plans.’
Adventure Trips
Activities like hiking, skiing, scuba diving, or guided expeditions may increase the risk. Also, getting medical attention while in tough-to-reach locations can be extremely expensive. Some travel insurance plans include coverage for adventure activities, which will cover you if an accident occurs during your trip. See our list of the ‘Best Adventure Travel Insurance Plans’ for help finding a reliable policy.
Traveling Later in Life
Older travelers may face higher medical risks while traveling. Travel insurance can help cover unexpected medical expenses, hospital stays, and emergency transportation during a trip. Our ‘Best Travel Insurance for Seniors’ list features a wide range of policies suitable for older explorers.
Traveling With Existing Health Issues
For travelers with pre-existing medical conditions, certain plans may offer waivers or coverage options that help protect against condition-related medical emergencies or trip cancellations if eligibility requirements are met. We create a list of top-rated pre-existing condition plans to help you find a policy that covers flare-ups.
When is Travel Insurance Not Needed?
Traveling with insurance is generally recommended, especially if you fall into one of the categories listed above. However, there are a few situations where a policy may provide limited value, depending on your trip details and existing coverage:
- Low-Risk Domestic Trips: For brief trips within the United States, especially where medical care is easily accessible, the likelihood of needing emergency medical coverage is generally lower.
- Low-Cost or Fully Refundable Trips: If you don’t have many upfront costs or all of your flight, hotel, and tour expenses are refundable, the financial risk of canceling is minimal, and travel insurance may not be necessary.
- Existing Trip Protection: You may already have sufficient protection through a travel credit card that includes travel benefits. In these cases, additional coverage could be redundant.
Is An Expensive Plan Worth It?
It’s a common misconception that paying more for a plan means it has better coverage. This is not the case. Squaremouth always recommends the least expensive travel insurance plans that meets your coverage needs.
That said, an upgraded travel insurance plan with higher coverage amounts and more flexible benefits can be worth it, but not always. Upgraded plans make sense high-cost trips, travel to remote destinations, or tight travel itineraries. However, an expensive travel insurance plan for a quick getaway may not be.
What Do You Actually Get With an Upgraded Plan?
As with the purchase of any product, you’ll need to be thoughtful when buying travel insurance. A more expensive travel insurance plan doesn’t guarantee that you’ll have better coverage. However, there are characteristics of a travel insurance plan that can make it worth the added expense.
Here are some key benefits offered by higher-priced plans:
Higher Coverage Limits
Higher coverage limits for Emergency Medical and Medical Evacuation for international trips can increase the cost of a travel insurance plan. However, the higher premium can safeguard you against unexpected medical costs.
More Cancellation Reasons
Covered reasons for Trip Cancellation vary by plan. For example, most plans cover illness, injury, severe weather, and natural disasters. A more expensive plan can offer more covered reasons that may include legal proceedings, job loss, pregnancy, vehicle breakdown, and other situations.
Expanded Medical Coverage
A more expensive plan can offer a lower medical deductible or none at all, as well as primary travel medical insurance that doesn’t require you to file a claim with your health insurance provider.
CFAR and IFAR Upgrades
Policy upgrades like CFAR and IFAR, which allow you to cancel or interrupt your trip for reasons not listed in your standard comprehensive insurance policy, will increase the premium you pay.
Pre-Existing Condition Coverage
Travel insurance premiums are typically higher with a comprehensive plan that includes a Pre-Existing Condition waiver that covers a traveler with an existing medical condition.
Sports and Activities Coverage
A Sports and Activities add-on to cover medical expenses related to injuries from participation in risky activities will typically increase a travel insurance premium.
Is Travel Insurance Right for You?
Whether you should buy travel insurance coverage depends on your unique circumstances. While travel insurance has undeniable disadvantages, it has merits, particularly for international trips, cruises, or expensive vacations. The main thing is to evaluate your needs, understand the policy, and weigh the potential risks against the costs.
If you’re considering travel insurance, keep these tips in mind:
- Shop around and compare policies to find the plan that best covers your needs
- Read the fine print to ensure it covers what matters most to you
- Assess whether existing coverage from credit cards or other sources meets your needs
Reference our ‘Best Travel Insurance Companies” list to see today’s best providers