How Travel Insurance Works and What to Expect: The Essentials

Joyful woman standing under a waterfall by Daria Gordova via Unsplash.

So someone told you to get a travel insurance policy. Maybe it was someone on the Internet. 

Maybe a concerned relative. Or maybe it was us, The Travel Yogi (yep, it’s our favorite form of pre-adventure tough love). 

First off, congratulations – the fact that you need travel insurance means there’s an exciting trip in your future!

But when it comes to travel insurance, it feels like you’re about to dive into a paperwork nightmare. We totally get it. Car, home, and health insurance are complex enough, and adding the novelty of travel insurance to the mix immediately evokes a headache. 

No need to pop an ibuprofen just yet – getting set up with travel insurance doesn’t have to be complex or exhausting. The trick is partnering with an excellent travel insurance company that puts your needs first. And, of course, a solid understanding of the basics. 

In this article, we’ll cover the essentials of how travel insurance works, start to finish. From the moment you start shopping for plans, to understanding what travel insurance covers, to making a claim, here’s what you can expect.

What is Travel Insurance?

Flying on a jetplane over the clouds by Patrick Tomasso via Unsplash.

Though it’s a self-explanatory concept on the surface, many of us don’t fully understand what travel insurance is until we buy our first policy. 

Simply put, travel insurance is a type of insurance that protects you from financial losses due to unexpected events before or during travel. 

Your mind probably jumps straight to flight cancellations or illnesses that can keep you at home. And yes, travel insurance covers these types of events, but that’s just the beginning. 

With travel insurance, you can be reimbursed for:

  • Flight cancellations or delays
  • Baggage loss, delay, or damage
  • Illness or injury that prevents traveling
  • Illness or injury that causes you to miss a part of your trip or go home early
  • Medical care abroad
  • Emergency transportation
  • Severe weather impacting the destination
  • Loss of a family member
  • Unforeseen work conflicts or job loss
  • Jury duty
  • And more!

…of course, the details depend on the policy you take out. This brings us to our main question…

How Does Travel Insurance Work?

Most travel insurance policies are reimbursement-based policies designed to meet your needs on a particular trip. 

The travel insurance journey goes like this:

  1. You shop for the right policy, carefully review coverage, and talk to representatives.
  2. You purchase a policy, usually for the timeframe of a specific trip.
  3. If an unforeseen event occurs, you collect documentation of what happened and pay up-front for the damages.
  4. You submit a claim to the insurance company with the documentation collected and get reimbursed. 

How to Get Travel Insurance

First thing’s first: make sure you need travel insurance for your trip and decide the high-level types of travel insurance you need. These include:

  • Trip cancellation insurance
  • Trip interruption insurance
  • Trip cancellation for any reason (CFAR)
  • Travel medical insurance
  • Medical evacuation coverage

To learn more about all this, check out our post on when travel insurance is necessary. 

Some helpful questions to ask:

  • Is my trip to a remote destination that’s prone to travel or weather issues? This impacts the level of trip interruption coverage you might need. 
  • Does my home health insurance cover me while abroad? This will help you decide whether you need medical coverage, and how much.
  • Will I be participating in action sports or adrenaline-packed activities? 
  • Are travel illnesses common at my destination? This question and the previous will influence your trip interruption and medical insurance needs!
  • Are there situations that might demand my attention at home? …Like a relative who needs care or an ever-changing job? If so, you might need more comprehensive trip cancellation insurance.

With your needs in mind, review available policies online, or better, talk to a trusted representative. Recommendations and referrals are everything here!

At The Travel Yogi, we have an ongoing relationship with representatives at Redpoint who know our itineraries inside and out. Redpoint always sets our adventurers and team members up with the coverage they need at a reasonable price.

Set your dates, pay for your policy, and you’re ready to jet off to your destination… where hopefully you’ll never have to use your coverage (but you’ll be so happy to have it if anything does go awry!)

How to File a Travel Insurance Claim

Let’s imagine something does go awry. Travel insurance is mostly reimbursement based. That means you’ll pay for what you need – say, a hotel room while you wait for a delayed flight, or new stuff if your bag gets lost. 

Many of the incidents that trigger travel insurance require attention right now: you need that  hotel room or new pajamas and a toothbrush right away! The reimbursement model simplifies everything on both sides of the equation.

Collect documentation of the incident. This includes receipts or financial statements as well as documentation proving what happened: for example, an email from your airline saying your flight was delayed.

With your documentation in hand, you’ll fill out a claim with the insurance provider when you’re able. Most companies offer an online portal that makes claims straightforward. If they need any more information, they’ll get in touch with you. 

Once that’s all squared away, you’ll receive the reimbursement you’re owed per your policy!

How Travel Insurance Works for Medical Care

The one area you might see an exception to the reimbursement model is medical care. Travel medical insurance can be either reimbursement-based or billed directly. 

Direct billing is the model you’re used to from your daily health insurance. You’ll have an insurance ID card so the medical provider can bill the insurance company directly. This is the ideal model – medical bills can get expensive out-of-pocket!

Medical travel insurance policies designed for adventure travel should be even more sophisticated. That’s because getting sick or injured in a remote area is a huge logistical challenge! You should be able to contact a representative who will help you locate care, get to that care, and navigate cultural and language barriers along the way. 

If you’re particularly concerned about medical coverage, ask an insurance rep about it before you purchase a policy!

Travel Insurance Example

Let’s imagine you’re on a yoga adventure in the Arctic. You’re having a beautiful morning e-biking around the tundra… until you slip on a patch of ice and land hard on your left wrist (yowch!)

You’re pretty sure it’s broken, but you’re at a remote wilderness lodge that’s only accessible by weekly charter flights. Fortunately, you purchased the Cavalry travel insurance plan

This plan would cover:

  • An emergency flight back to Yellowknife, the nearest city (up to $1 million). 
  • An x-ray and getting the broken bone set (up to $100,000).
  • Reimbursement for an early flight home, plus all of the activities you unfortunately missed in the Arctic (up to 150% of the trip cost, so you can come back another year!)

By our rough estimates, you ultimately wouldn’t have to pay a penny! You’d still be sad, but that’s a heck of a lot better than being sad and totally out of funds.

Coverage is Key to Adventuring Well

By now, we hope it’s pretty clear why we’re always touting the benefits of travel insurance… and if you were hesitant, we hope you’re ready to move confidently through the process.

Ultimately, a few hundred dollars will buy you a safety net that stretches across the globe. 

And when you travel with us, we remove all the guesswork. 

When you book a yoga adventure, we’ll set you up with all the resources you need to get the right policy for the trip by sending you a custom quote after you book!

That way, you can shift your focus back to the adventure, the wellness practice, the culture you’ll take in, and the friends you’ll meet along the way. 

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