Do You Really Need Travel Insurance? When It’s Worth It (and When It’s Not)

Travel in 2025 looks a lot different than it did just a few years ago. Whether you’re planning a short domestic getaway or a long-haul international adventure, one question keeps popping up for travelers: should I buy travel insurance?

It’s tempting to skip it, especially when you’re already shelling out money for flights, hotels, and activities. But travel insurance isn’t just another box to check—it can make or break your trip financially if something unexpected happens. Still, it’s not always necessary, and not all policies are worth the price.

So, how do you know when travel insurance is a smart investment and when it’s an unnecessary add-on? Let’s break down when it’s worth buying, what it actually covers, and when you can confidently travel without it.

What Travel Insurance Covers (and What It Doesn’t)

At its core, travel insurance is designed to protect your trip—and your wallet—from disruptions, emergencies, or losses that fall outside your control. But not all policies cover the same things, and it’s important to read the fine print.

Standard travel insurance usually includes coverage for:

Trip cancellation or interruption: If you get sick, a family emergency comes up, or your flight gets canceled due to weather or a strike, travel insurance can reimburse you for prepaid, non-refundable expenses.

Medical emergencies: If you’re injured or fall ill while abroad, many travel insurance plans cover hospital bills, medications, and sometimes even medical evacuation back to your home country.

Lost or delayed baggage: If your luggage takes a detour or gets lost entirely, insurance can help you replace essentials or reimburse you for your belongings.

Travel delays: If a delayed flight forces you to stay overnight or miss a connection, you may be covered for meals, lodging, and rebooking fees.

Emergency evacuation or repatriation: In case of natural disasters, civil unrest, or medical emergencies, travel insurance can help you get home safely.

Some premium plans also offer “cancel for any reason” add-ons or special coverage for things like adventure sports, rental car damage, or COVID-19-related disruptions.

What’s not usually covered? Changing your mind about a trip, ignoring travel advisories, or attempting risky activities that aren’t disclosed. Most travel insurance also doesn’t cover costs from pre-existing medical conditions unless you buy a policy with a waiver.

When Travel Insurance Is Absolutely Worth It

There are certain situations where travel insurance can save you thousands—or at least prevent major headaches. If your trip involves non-refundable costs, complex logistics, or international travel, it’s often worth the peace of mind.

If you’re booking a big international trip with prepaid flights, hotels, tours, or cruises, you’re locking in a lot of money upfront. If something prevents you from going, trip cancellation coverage can reimburse you for those expenses. Without it, you’re just out of luck.

Traveling abroad without health insurance is a big gamble. Most U.S.-based health insurance plans don’t cover international medical care. Even something as simple as a sprained ankle in Europe could result in a hefty bill. And in serious situations, the cost of medical evacuation alone can run into five or six figures.

Trips with multiple flights or complicated itineraries are also riskier, especially when one delay can cause a domino effect. In those cases, travel insurance with good delay or missed connection coverage can help you recover some of your lost time and money.

If you’re traveling during hurricane season, to politically unstable regions, or anywhere where natural disasters are common, insurance that includes evacuation coverage can be incredibly valuable. Some policies also monitor global events and alert you in real-time if your destination becomes high-risk.

And finally, if you or your travel companions have health conditions that could flare up, choosing a policy that includes coverage for pre-existing conditions (with a waiver, if needed) is a smart move.

When Travel Insurance Might Be Overkill

There are definitely times when travel insurance isn’t necessary—and skipping it can save you money without adding much risk.

Short, inexpensive domestic trips are a good example. If you’re flying to another state for a weekend wedding and staying with friends, your financial exposure is likely low. In that case, even if your flight gets canceled, you’re probably not losing thousands in prepaid reservations.

If you’re using travel rewards or points for your trip, the value of what you could lose is lower. Many credit card rewards programs offer flexible cancellation or rebooking options, and you might not be out-of-pocket for most costs.

And speaking of credit cards—many offer built-in travel protections if you use them to book your trip. Premium cards like the Chase Sapphire Preferred or Capital One Venture X come with trip cancellation insurance, rental car coverage, and more. In some cases, this built-in protection is enough, especially for basic travel hiccups.

It’s also worth noting that not all travel insurance is created equal. Cheap policies with low coverage limits and long exclusions might not actually offer meaningful protection. If you’re only spending $20 on a barebones plan, make sure you’re not just buying a false sense of security.

The Cost of Travel Insurance in 2025

On average, travel insurance in 2025 costs between 5% and 10% of your total trip cost. So if you’re spending $3,000 on a vacation, a decent policy might cost you $150 to $300.

Factors that influence cost include your age, trip length, destination, total cost of your trip, and coverage options. For example, older travelers tend to pay more, and adding a “cancel for any reason” option can increase the cost significantly.

Is that a lot? Maybe. But in the event of a major trip cancellation, serious illness, or lost baggage nightmare, it could be a fraction of what you’d otherwise lose.

How to Choose a Travel Insurance Policy

Start by figuring out what you need. Are you worried about cancellation? Medical issues? Lost luggage? Once you know your biggest risks, shop for plans that prioritize those.

Use comparison sites like Squaremouth or InsureMyTrip to review different policies side by side. Look at coverage limits, deductibles, and exclusions—not just the price.

Also, read real reviews and check the insurer’s track record for paying out claims. A cheap policy is only valuable if it actually delivers when you need it.

Make sure you buy your policy soon after booking your trip. Many insurers require you to purchase coverage within a set window—often 14 to 21 days—if you want certain benefits like a pre-existing condition waiver.

If you’re unsure, talk to your credit card company to find out what’s already covered. Layering travel insurance on top of strong card protection might be unnecessary unless you’re facing high financial risk or international travel.

Is Travel Insurance Different in a Post-Pandemic World?

Absolutely. COVID-19 has reshaped the travel insurance industry. Many plans now specifically list COVID-19 coverage for medical care, trip interruption, or cancellation due to illness or quarantine. But not all do, so check carefully.

Some plans also now offer pandemic-related benefits like coverage for trip delays due to border closures or required testing delays. In 2025, many travelers still prefer flexibility and last-minute booking, so look for plans that let you adjust or cancel with fewer penalties.

The Bottom Line

Travel insurance isn’t a must-have for every trip—but it’s incredibly valuable for the right ones. If your plans are expensive, international, non-refundable, or involve medical risk, a well-chosen policy can save you serious money and stress.

On the flip side, if your trip is low-cost, close to home, or already covered by your credit card benefits, skipping travel insurance might be a safe bet. The key is knowing the value of what you’re protecting and how likely it is that something could go wrong.

So the next time you’re booking a trip, don’t just click past the insurance offer. Take a minute to think about what could go sideways—and whether you’d be okay footing the bill if it did.

In the end, travel should be about adventure, connection, and new experiences. Travel insurance helps keep those things front and center, even when life throws a wrench in your plans.