Credit card travel insurance: What you need to know

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Have you ever had a flight canceled at the last minute? Or arrive at your destination only to find your luggage decided to take a different vacation?

Credit card travel insurance can relieve financial headaches when your travel plans go wrong. From trip cancellations to lost luggage, many cards offer protections that reimburse you for unexpected expenses.

What is credit card travel insurance?

Credit card travel insurance is a suite of protections for common travel mishaps. It typically includes:

1. Trip cancellation and interruption insurance
2. Trip delay insurance
3. Baggage delay and lost luggage insurance
4. Travel accident insurance
5. Emergency evacuation insurance

Let’s take a closer look at each type of coverage.

Trip cancellation and interruption insurance

This benefit reimburses you for non-refundable expenses if you have to cancel or cut your trip short for covered reasons, such as illness, severe weather, or jury duty.

Just make sure you understand your card's coverage. Coverage limits often apply, and reimbursement is only for reasons specified in the policy.

Trip delay insurance

If your flight gets significantly delayed, this insurance can cover expenses like meals and lodging. Most cards require a minimum delay (often 6-12 hours) before coverage kicks in.

Baggage delay and lost luggage insurance

This protection reimburses you for essential purchases if your luggage arrives late or goes missing entirely. Just make sure that your delay is long enough for your insurance to kick in and that you don't buy any items that aren't covered.

Travel accident insurance

Travel accident insurance might cover your expenses after seeking medical treatment for those injuries. Policies vary, but your provider might offer financial compensation for death or dismemberment, loss of sight, or loss of hearing.

Emergency evacuation insurance

If you or your immediate family members require an emergency evacuation from your travel destination, this benefit can cover the cost of transportation.

Credit card travel insurance vs. standalone travel insurance

If you travel abroad from the United States, your health insurance will not cover you if you suffer an illness or sickness and require treatment in another country. Standalone travel insurance policies typically offer more comprehensive coverage, especially for medical care abroad. The cost ranges based on the length of your trip and how much coverage you require.

While free with your card, credit card travel insurance often has lower coverage limits and may not include medical coverage. For international trips or specific concerns, it may be wise to supplement your credit card insurance with a standalone policy.

Elad Schaffer, co-founder and CEO of Faye Travel Insurance, advises, "Some travel credit cards may come with partial trip protection and emergency medical coverage but typically are wrought with limitations compared to whole-trip travel insurance policies. Make sure to dive into your travel credit card coverage before automatically opting for that over a more comprehensive travel insurance policy."

When to rely on credit card travel insurance

Credit card travel insurance is often enough coverage for domestic trips, especially if you have comprehensive health insurance. For international travel or if you have specific concerns, consider supplementing with a standalone policy to ensure adequate medical coverage and higher reimbursement limits.

How to qualify for credit card travel insurance

To access your card’s travel insurance benefits:

• Apply for a card offering travel insurance. These cards often require good to excellent credit (a FICO score of 670-850).
• Book your travel using that specific card. If you use a different card, the card offering travel insurance won’t reimburse you.
• Meet any additional requirements, such as minimum trip length or delay duration. Remember that some cards have reimbursement limits that might not cover your entire expense.

Credit cards that offer travel insurance

Several credit cards offer travel insurance. Here are a few options:

Dr. Peter Earle, senior economist at the American Institute for Economic Research, says that consumers should choose their card carefully: Not all cardholders need all the travel insurance perks offered by cards that charge higher annual fees.

"It is critical to know what you are getting and not getting," Earle says. "If you are just a casual traveler, it is probably not worth paying a higher annual fee to access perks that you will probably not use. It's up to the individual to know if a card with travel insurance is worth it."

Coverage details and limitations

How do these travel insurance benefits work? Here’s a look at the basics of each major travel insurance category:

Trip cancellation and interruption

Each credit card provider's trip cancellation/interruption insurance will vary slightly, but covered reasons often include:

• Illness or injury of you, a traveling companion, or a family member
• Severe weather that prevents travel
• Jury duty or subpoena
• Terrorist incident at your destination

Most cards have a maximum benefit amount per trip and per 12-month period. Check your specific card's terms for exact coverage limits.

Trip delay insurance

If your flight, train, or other common carrier gets delayed beyond a certain number of hours (usually 6-12), this coverage can reimburse you for reasonable expenses. This may include meals, lodging, and toiletries.

The delay time required to trigger coverage and maximum reimbursement amounts vary by card. Some cards may have a per-ticket limit and a total trip limit.

For example, if you booked your travel with a qualifying American Express card, the maximum benefit is $10,000 for a covered trip and $20,000 for an eligible card for 12 consecutive months.

Baggage delay and lost luggage insurance

Lost luggage coverage typically reimburses you if the airline permanently loses your checked bags. There's usually a maximum benefit amount per covered trip. Capital One's lost luggage benefit is a good example of how this perk usually works. If your airline loses your luggage, your card will reimburse you for up to $3,000 per covered trip.

Baggage delay insurance kicks in when your luggage is temporarily delayed, often for six hours or more. It usually covers essential purchases like clothing and toiletries, up to a daily and total trip maximum.

For example, if you booked travel with your Chase Sapphire Reserve and your baggage was delayed for more than six hours, you can be reimbursed for essential purchases such as clothing and toiletries — up to $100 daily for five days.

Travel accident insurance

This provides coverage in case of accidental death or dismemberment during a trip. The coverage amount can be substantial but only applies in specific circumstances.

Travel accident insurance coverage varies by provider, but the United Club Card, for example, provides up to $500,000 of accidental death or dismemberment coverage.

The card can also cover medical services and transportation if you or a member of your immediate family requires an emergency evacuation during a trip because of illness or injury.

Filing a claim and receiving benefits

You’ve had to cancel your trip, your luggage gets lost somewhere across the country, or you get stuck in the airport during a 10-hour delay. How do you file a claim for your travel insurance benefits?

The process varies by provider, but here are the basic steps you’ll need to take:

1. Contact the airline (or cruise line, etc.) first. They need to start their claims process before your card company steps in.
2. Notify your credit card company within the required timeframe. Most companies give you a 20-60 day window to start the claims process.
3. Fill out a claim form and submit any required documentation (e.g., receipts, medical records, trip itinerary).
4. Provide any additional information requested by the card issuer.

Always keep detailed records and receipts for all expenses related to your claim.

Tips for maximizing your credit card’s travel insurance benefits

1. If you’re a frequent traveler, choose a card with solid travel benefits.
2. For occasional travelers, look for cards with decent insurance and lower annual fees.
3. Always book travel with the card offering the insurance.
4. Keep detailed records of all travel-related expenses and documentation.
5. Read the fine print before you jet off — knowing your coverage beforehand is better than finding out later.

Frequently asked questions

The bottom line

Credit card travel insurance is like most other insurance: You hope you never have to use it. But if your flight is canceled or delayed, your luggage is lost, or you break your leg while traveling, your credit card’s travel insurance benefits can provide you with a safety net. If you’re a frequent traveler, looking for cards offering this protection makes sense.

*Eligibility and Benefit level varies by Card. Terms, Conditions, and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company.

Editorial disclosure: Opinions expressed are author's alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.