Ask Stacy: Should I Buy Travel Insurance?

Travel insurance is regarded as a lifesaver by some, and a rip-off by others. Here's what you should look for before you shop.

Ask Stacy: Should I Buy Travel Insurance? Photo by David Prado Perucha / Shutterstock.com

Welcome to “Ask Stacy,” a short video feature answering money questions submitted by readers and viewers. You can learn how to send in a question of your own below.

If you’re not typically a video watcher, give it a try. These videos are short and painless, and you’ll learn something valuable. But if you can’t deal with video, no problem: Just scroll down this page for the full transcript of the video, as well as some reader resources.

Today’s question is about whether travel insurance is worth the money.

As with many questions, this one isn’t cut and dried. Whether travel insurance is a good deal differs depending on:

  • The type of person you are.
  • Who you’re getting the insurance from.
  • How much it costs.
  • Where you’re going.
  • How much you’re spending to get there.

No matter your situation, however, you should know about this form of specialty insurance. And you will know a lot more after watching the following video.

For more information, check out “When Is Travel Insurance Worth the Extra Cost?” and “Find 14 Super Smart Ways to Save on Travel.” You can also go to the search at the top of this page, put in the word “travel” and find plenty of information on just about everything relating to this topic.

Finally, check out the newest section of our Solutions Center for the latest and greatest travel deals.

Got a question of your own to ask? Scroll down past the transcript.

Don’t want to watch? Here’s what I said in the video

Hello, everyone, and welcome to your money Q&A question of the day. I’m your host, Stacy Johnson, and this answer is brought to you by MoneyTalksNews.com, serving up the best in personal finance news and advice since 1991.

Today’s question comes from Marsha:

“Do you have any information on travel insurance, and whether or not it’s a necessity? We’re getting ready to go on a river cruise in Europe later this year, and we’re wondering if we really need this?”

First, Marsha, I think you should consider taking me along on your river cruise! After all, you may need some financial advice while away. But while waiting for you to confirm my invitation, I’ll answer your question.

Travel insurance is kind of weird. A lot of people — including me — don’t buy it, but it really depends on where you’re going, who you are, how much it costs and other factors.

For example, if you’re concerned about your health and on Medicare, you might want to get some travel and/or health insurance that will cover you outside the country, since Medicare doesn’t.

It also depends upon how risk-averse you are. If you’re paying a bunch of nonrefundable money upfront for a river cruise, you might want to get some insurance in case something comes up and you can’t go.

So, there are some instances where travel insurance might make sense. But before you consider it, start by seeing what coverages you already have. For example, some credit cards may offer you some limited coverage for things like lost luggage. The health insurance you have at home might work overseas. I just told you Medicare doesn’t cover you abroad, but that doesn’t mean all insurance doesn’t.

If you opt for travel insurance, be sure and read the fine print. See exactly what’s covered and what’s not, because these policies are notorious for refusing to pay when you thought you were covered. Do some reading, and you’ll find plenty of examples of these unfortunate refusals. So, if you have questions, call the company and ask about it. Give the company various scenarios, and see how it responds.

Don’t forget to shop around. When you go through a travel agent — as you might for something like a European river cruise — remember you don’t have to buy travel insurance from your agent. Check other sources. Two I’ve seen recommended, but can’t personally vouch for, are WorldNomads.com and InsureMyTrip.com. But again, before you buy, understand exactly what you’re paying for.

I hope that answers your questions, Marsha. Let’s conclude today with our quote of the day. This one comes from George Orwell, the famous novelist.

“Within certain limits it is actually true that the less money you have, the less you worry.”

Have a super-profitable day and meet me right here next time!

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The questions I’m likeliest to answer are those that will interest other readers. In other words, don’t ask for super-specific advice that applies only to you. And if I don’t get to your question, promise not to hate me. I do my best, but I get a lot more questions than I have time to answer.

About me

I founded Money Talks News in 1991. I’m a CPA, and have also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate.

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Stacy Johnson
Stacy Johnson @moneytalksnews
I'm the founder of Money Talks News and have spent the last 40+ years in the personal finance trenches. I'm a CPA, author of a few books and multiple Emmy recipient. I'm ... More

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