Is it necessary to purchase travel insurance if your credit card offers protection?

Some credit cards come with built-in travel insurance as a benefit for cardholders. It might be tempting to depend solely on credit card travel protections rather than investing in travel insurance. However, the primary purpose of travel insurance is to provide coverage in case things go awry. This raises the question of whether you should still consider travel insurance even when your credit card includes travel protection.

There isn’t a universal answer that applies to every traveler or scenario. In this guide, we will examine various factors you should take into account, and I'll share my perspective on this matter. Let’s explore this further so you can make a well-informed choice for yourself.

Types of travel insurance available for purchase

In general, you can pay a relatively modest premium (in comparison to the overall cost of your trip) to obtain a travel insurance policy that may offer reimbursement or coverage for unforeseen issues that impact your journey.

The term 'travel insurance' encompasses a variety of protection types. Standard, comprehensive insurance plans usually offer extensive coverage for a wide range of potential issues.

Additionally, there are policies that provide targeted coverage. For instance, you can find travel insurance that exclusively covers medical expenses for international travel (like GeoBlue). There are also options that enable you to customize your coverage (such as the build-your-own option available with American Express Travel Insurance).

We have previously evaluated the top travel insurance policies and providers. Be sure to consult that guide to discover the provider and policy that best meet your needs. You can also use a travel insurance aggregator to swiftly compare various policies.

Most travel insurance plans do not cover losses related to preexisting medical conditions. However, many policies offer a way to waive this exclusion if certain conditions are met. Typically, these conditions include purchasing the policy shortly after making your first nonrefundable payment for the trip and being medically fit to travel when you buy the policy. Some insurers may also require you to insure the full, prepaid, nonrefundable cost of your trip to qualify.

Similarly, all travel insurance policies come with various exclusions. For instance, most plans do not cover medical expenses for injuries sustained during adventure activities like skydiving or skiing off marked trails.

Credit card travel protections

While some cards offer no travel protections, many of the top travel rewards cards do provide these benefits. Here’s a summary of some of the most common credit card travel protections:

• Reimbursement for trip delays
• Reimbursement for baggage delays
• Insurance for trip cancellation and interruption
• Insurance for travel accidents and emergency evacuations

For more information on which card might suit you best, check out our guide to the top cards offering travel protections. I also suggest reviewing the benefits guide for your specific cards, as these documents will outline the exact protections you can expect when booking travel with your card.

Be aware that some benefits may require enrollment, and nearly all necessitate a formal claim process, with no guarantee of reimbursement.

When to buy travel insurance

Even if you possess a credit card that provides travel protection, there may be occasions when purchasing travel insurance is a wise choice. Here are some situations and trips where it could be beneficial to obtain travel insurance.

Travel protections are not guaranteed

As mentioned earlier, not all travel credit cards offer comprehensive travel protections when booking travel. Therefore, if you're using a card that lacks adequate travel protections or provides only minimal coverage, it may be wise to consider purchasing travel insurance.

Certain travelers may lack coverage

Having a card with travel protections does not mean that everyone traveling with you is automatically covered. Generally, these protections extend only to specific relatives of the cardholder, and may not include friends, employees, or all family members.

Adventure activities

If you're planning to engage in an activity that is commonly excluded by most insurance policies, it may be wise to secure a travel insurance policy that specifically covers your chosen activity.

For instance, numerous policies exclude coverage for adventure sports such as base jumping, sky diving, free solo climbing, scuba diving, mountaineering, and paragliding. Consider obtaining insurance from an organization related to your adventure, like the Divers Alert Network (DAN) for divers or the German Alpine Group (DAV) for those participating in alpine sports.

You have concerns regarding preexisting conditions

Most credit card trip interruption and cancellation insurance benefits typically do not cover cancellations or interruptions resulting from a sudden flare-up of a preexisting condition. Therefore, if you want trip cancellation and interruption coverage that includes preexisting conditions, it's essential to purchase travel insurance and meet the provider's waiver requirements for preexisting conditions.

Nonmedical evacuation insurance

If you require evacuation insurance for nonmedical situations, it's advisable to obtain travel insurance that provides this coverage, even if your credit card includes evacuation insurance.

Examine the benefits guide thoroughly, as evacuation coverage may not apply to all situations. For instance, certain policies may exclude evacuations from areas that have a travel warning at the time of your booking, or from locations that become inaccessible due to environmental events like landslides.

Cancel for any reason

If you’re uncertain about your ability to go on your trip and are concerned that the trip protections offered by your credit card won’t cover cancellations for unapproved reasons, consider purchasing cancel for any reason trip insurance.

You desire peace of mind

Many travelers choose to purchase travel insurance — either for each trip or through an annual travel insurance plan — for the reassurance that a travel insurance policy provides. Given some of the challenges travelers have encountered with a particular credit card insurance provider, it might be beneficial to buy a travel insurance plan if you're unsure that your credit card travel insurance and personal health insurance will offer sufficient coverage during your journey.

When credit card travel protections might suffice

If you don’t belong to any of the aforementioned categories and utilize one of the top credit cards with travel insurance for your travel purchases, you might find that credit card protections are adequate for some or all of your trips. However, I recommend depending on credit card protections only if you also possess health insurance that offers sufficient coverage while at your destination.

Here are several reasons why you might opt for credit card protections instead of obtaining separate travel insurance. If several of these reasons resonate with your situation, it could be sensible to rely on credit card protections rather than purchasing travel insurance:

• You possess personal health insurance that covers you during your trip, even if treatment is provided by out-of-network providers at your destination
• You book your travel using a credit card that includes travel insurance
• Your credit card offers medical evacuation benefits while you’re traveling
• Your travel plans are refundable, allowing you to cancel at little or no cost
• You often change your itinerary or make last-minute bookings
• You maintain an emergency fund to cover unforeseen expenses if necessary
• You have airline miles or transferable points that can be used to leave the area or return home if needed.
• You steer clear of particularly high-risk activities and destinations

Deciding whether to purchase travel insurance is a nuanced and personal choice. If you are uncertain that your credit card protections and individual health insurance will offer sufficient coverage, investing in travel insurance may be a wise decision.

Reasons why credit card travel insurance generally suffices for me

After investigating the top travel insurance policies and providers, I opted for travel insurance for one particular trip because I wanted coverage for political evacuation.

However, for the majority of my travels, the protections offered by my credit card and my individual health insurance are sufficient. Typically, my travel plans involve the following:

• Most of my flights are award tickets that can be canceled and redeposited at no cost, or they incur minimal change and cancellation fees
• I can usually cancel my accommodations without any penalty until shortly before my check-in date
• When I book tours or activities, it's often within a few days, or they come with a free cancellation policy
• My health insurance covers out-of-network care while abroad, meaning travel insurance would only cover my deductible. Moreover, my out-of-pocket maximum for out-of-network services is low enough that I can manage using my emergency fund
• I purchase flights and pay for the taxes and fees on award flights using the Ink Business Preferred® Credit Card, which offers excellent travel protections for an annual fee of $95
• I possess plenty of airline miles and transferable points that I can use for last-minute one-way flights if necessary

As demonstrated, the advantages of purchasing travel insurance would be minimal for the majority of my trips. The travel protections I rely on most are trip delay protection and baggage delay protection, both of which are provided by the Ink Business Preferred Credit Card when I use it for flight payments.

In conclusion

When planning your trips, you might find yourself questioning the necessity of travel insurance. A useful approach to making this decision is to evaluate whether you would be sufficiently protected without it in case of an unfortunate event.

If you're prepared to handle the expenses that might arise in such circumstances — or if you're confident that your credit card's travel protections and health insurance would provide enough coverage — you might consider going without travel insurance. However, if you have any doubts, I suggest purchasing a travel insurance policy soon after making your initial trip payment.