Is travel insurance worth it? How to decide for your trip
Honest answer: sometimes yes, sometimes no. The question is really whether you could comfortably absorb the worst realistic loss on this trip. Here is how to work that out.
By the StarHolidays Editorial Team Updated 4 min read
Key takeaways
- Insurance is most valuable for losses you could not comfortably pay for yourself.
- Medical emergencies abroad are the strongest reason to buy, especially if your home cover stops at the border.
- A cheap, refundable domestic trip with good health cover may not need a policy at all.
- Sometimes it isn't your choice: some visas and destinations require cover.
On this page
The question to ask
Insurance always costs more on average than it pays out, because insurers need to cover their costs and make a profit. So it's not a great way to protect yourself from small, affordable annoyances. It's good at protecting you from losses that would really hurt.
So don't ask "will something go wrong?" Ask "if the worst realistic thing happened on this trip, could I pay for it without serious damage to my finances?" If not, insurance is probably worth it.
Three checks
1. What could you lose before you go?
Add up everything that's prepaid and non-refundable. Then check what would come back if you cancelled tomorrow, and whether that changes as your departure gets closer. A flexible flight credit and a free-cancellation hotel leave you with little at risk. A $9,000 safari with a strict cancellation schedule leaves you with a lot.
2. What could a medical emergency cost?
This depends mostly on where you're going and on what your existing cover pays. The CDC warns that your medical insurance at home may not cover care in another country, and that you may need to pay out of pocket. It also says an evacuation could cost more than $100,000. The US State Department gives a range of about $20,000 to $200,000 for an air ambulance back to the US.
For most people, this is the strongest argument for buying, because it's a low-probability event with an unaffordable cost.
3. What do you already have?
Check these before you buy anything:
- Your health plan. Ask specifically about emergencies abroad and evacuation. In many systems the answer is "very little". See our home country guides.
- Your credit cards. Some include trip protection, but card cover has important limits, particularly for medical care.
- Your employer. Business trips may be covered, personal trips often aren't.
- Reciprocal arrangements. The UK GHIC and Australian reciprocal agreements can help, but neither replaces insurance.
When it's usually worth it
- International trips where your home cover stops. Particularly the US, cruises and remote destinations.
- Expensive prepaid trips. Tours, safaris and cruises often have steep cancellation penalties.
- Older travelers or those with health conditions. Claims are more likely, even if premiums are higher.
- Adventure trips. Rescue costs can be significant, although you'll need a policy that actually covers the activity.
- When it's required. A Schengen visa application needs cover, and some destinations now require it to enter. See our tracker.
When you might reasonably skip it
- Short domestic trips where your health cover applies and little is prepaid.
- Trips with mostly refundable bookings, if you have good medical cover abroad from another source.
- A trip so cheap that you could write it off and you already have evacuation and medical cover in place.
Note what all of those have in common: you've confirmed the medical side is handled. Skipping cancellation cover is often reasonable, but skipping medical cover abroad seldom is.
Two worked examples
Example 1: a weekend away. Two people drive to a city in their own country for $400 of refundable hotel nights. Their health plan works there. Their worst-case loss is minor and affordable. Comprehensive insurance probably isn't worth it.
Example 2: a month in Southeast Asia. A 28-year-old has $1,200 in prepaid flights and hostels and a public health plan that doesn't pay abroad. Cancellation isn't the main concern, but a motorbike accident might mean surgery and a flight home. A backpacker-friendly medical policy that includes the right activities makes sense, even if comprehensive cover doesn't.
Same question, two different answers, and that's the point.
Don't forget the less obvious benefit
When something goes badly wrong abroad, one of the most useful things a good policy gives you is a 24-hour assistance team that speaks to doctors, finds hospitals and organizes transport. When you're frightened, in an unfamiliar country and don't speak the language, that help can be worth a great deal, even before any money changes hands.
Our view: for most international trips, buy at least solid medical and evacuation cover. Add cancellation cover in proportion to what you'd actually lose. Treat everything else as optional.
Frequently asked questions
What are the odds I will actually claim?
Most trips pass without a claim, and that's fine. You are paying to avoid an outcome you could not afford, not expecting to get your money back. Reliable claim rates vary between sources, so we would not base the decision on them.
Is travel insurance worth it for a cheap trip?
It may still be worth having medical cover if you are traveling abroad, since a hospital bill is unrelated to what you paid for the trip. Cancellation cover matters less when little is at stake.
Is travel insurance worth it for young, healthy people?
Often yes for trips abroad. Accidents do not check your age, and younger travelers often take part in riskier activities. Premiums also tend to be lower at younger ages, so the cost is easier to justify.
Does the airline protection offered at checkout count?
It might be worth considering, but it often offers limited cover. Compare its medical and evacuation benefits, and check who the underwriter is, before accepting it by default.