Travel insurance is designed to provide financial protection for unexpected events that impact a traveler’s trip. Popular benefits on a travel insurance policy include coverage for trip cancellations, medical emergencies, travel delays, and luggage. There are three different types of travel insurance policies: single trip, annual, and group.
Single Trip Travel Insurance Policies
Single trip travel insurance covers travelers for one trip, starting when they leave home and ending when they return. A single trip policy can cover up to 10 travelers on international or domestic trips.
Travelers who are concerned about having to cancel their trip should consider a single trip policy with Trip Cancellation coverage. This benefit reimburses insured trip expenses if a traveler is unable to travel for one of the policy’s covered reasons. Travelers must insure all or some of their trip cost to be eligible for this benefit. Single trip policies with Trip Cancellation are the most common type of travel insurance policy purchased.
Most cancellation-style policies are comprehensive, covering travelers for their trip payments, medical emergencies, travel delays, and luggage. This type of single trip policy typically costs between 4% and 10% of a traveler’s trip cost, depending on their age, the length of their trip, and their total trip cost.
Travelers who are not concerned about cancelling do not need to insure a trip cost, and can buy a single trip, non-cancellation style policy to cover medical emergencies, travel delays, and luggage. Because there is no insured trip cost, these policies are typically less expensive. However, except for Trip Cancellation coverage, the benefits included are usually the same.
Annual Travel Insurance Policies
Annual policies are designed to cover travelers taking multiple short trips throughout a year. Travelers select a specific start date for an annual policy, which can be the departure date for their first trip. An annual policy will last one year from that date.
Annual policies typically limit how long one trip can last, and may have limits for how many trips can be taken throughout the year. The Maximum Trip Length ranges from 30-365 days, depending on the policy.
The coverage offered on an annual policy usually differs from a single trip policy. Most annual policies are primarily designed to provide medical coverage, offering Emergency Medical and Medical Evacuation benefits. These policies typically do not include Trip Cancellation coverage.
Group Travel Insurance Policies
While a single trip policy can cover up to 10 travelers, group travel insurance allows parties of 10 or more travelers to purchase one policy for their trip. Group policies offer benefits similar to single trip policies, including coverage for cancellations, medical emergencies, travel delays, and luggage.
Purchasing a group travel insurance policy can be a more convenient and affordable option for organized groups traveling together. The premium of a group policy does not take the travelers’ ages into account. Therefore, because age is one of the main factors that determines a policy’s premium – along with trip cost and trip length – group policies can be significantly less expensive per traveler.