Do you need travel insurance in 2023?

Gerri Hether has big travel plans for 2023. In a few weeks, she’s embarking on a cruise to Antarctica. Then there’s his annual vacation to Hawaii. And there are shorter domestic routes, which have yet to be planned.

But she won’t go anywhere without one thing: travel insurance.

“With airlines being as screwed up as they are, travel insurance for trip cancellation, delay and interruption is just a common sense decision,” says Hether, a nurse at the retirement from Mesa, Arizona. “Peace of mind is worth the cost.”

It’s not too early to declare 2023 the year of travel insurance. The summer of 2022 has issued a warning that travelers are heeding, according to the latest forecast.

A new study predicts that the global travel insurance market will grow 17% this year to $18.8 billion. By 2026, it will be a $32.61 billion industry.

“Given today’s global and economic uncertainties, coverages that help protect travelers’ travel costs could be even more important in 2023,” said Chris Carnicelli, CEO of Generali Global Assistance. “No one wants to waste the financial investment it takes to plan a trip, especially in today’s economy.”

According to experts, the main driver of change has been the pandemic.

“In the past, travelers could say, ‘I don’t plan to cancel my trip, so I don’t need trip cancellation coverage,’ says Shannon Lofdahl, CEO of Travelex Insurance Solutions.” Now they realize that cancellation may not be their choice. For example, healthy young people who weren’t afraid of getting sick before COVID-19 while traveling now know they can get COVID-19 anytime, anywhere, so they buy a travel insurance. »

What has changed in 2023?

The travel landscape is radically different from last year. COVID is less of a concern now, but experts fear the airline problems of the summer will carry over into 2023. There is also more geopolitical uncertainty and economic worries, making travel more uncertain than never next year.

“2023 will be the year consumers want their travel insurance policies to work harder,” says Daniel Durazo, director of external communications at Allianz Travel Insurance. “As more travelers add travel insurance to their packing list, they’ll be looking for products that offer the coverage and benefits that best suit their needs.”

Plus, travel may be more expensive than ever. So there’s more to lose, says Laura Heidt, insurance office manager at Brownell Travel.

“So I think even more people, people who normally don’t even think about insurance, will have a different mindset about it,” she says. “I’ve found it so much easier to have detailed conversations with clients and advisors about this in 2022, and I think it will continue to be a welcome conversation, even with younger people, in 2023.”

Heidt also spoke to customers about joining medical evacuation like Medjet, which is an add-on to travel insurance.

Who needs travel insurance in 2023?

So when should you consider a travel insurance policy?

When you spend more than $3,000 on travel

In fact, some travel agents insist that you secure an expensive vacation. “If the cost of the trip is over $3,000, I won’t book the trip without insurance,” says Lisa Prosser, travel consultant at Chartwell Luxury Travel.

If you need peace of mind

Hether, the retired nurse, says her travels aren’t inherently dangerous, but she likes knowing someone has her back. “Travel insurance is more for peace of mind than anything else,” says Michal Strahilevitz, a consumer psychologist who teaches at Saint Mary’s College of California. “It reduces anxiety while you travel and allows you to enjoy your trip more. I think it’s money well spent.”

When you leave the United States

A hospital outside the United States will likely insist on upfront payment for medical services, which can cost thousands of dollars or more. Also, if you’re on Medicare and don’t have supplemental coverage or a benefits plan. “There’s a common misunderstanding among seniors that their health insurance will protect them outside of the United States, but that’s not the case,” says travel consultant Mitch Krayton.

Experts say travel insurance is especially important after COVID. Travelers concerned about infection or who may be immunocompromised can consider special insurance such as COVAC, which offers COVID-19 Worldwide Membership with $1 million in transportation benefits.

But there’s another reason you’ll need travel insurance in 2023.

Where is travel insurance required?

Several countries have started requiring travel or health insurance during the pandemic. Here is a short list:

• Caribbean destinations, including the Cayman Islands, Jamaica and St. Maarten, require their visitors to have insurance.
• Popular European destinations, including many in the Schengen region (most of Western Europe), also have tourist insurance mandates.
• In the Middle East, Egypt, Israel and the United Arab Emirates have travel insurance requirements on the books.

Note: In practice, these requirements are not always applied. Over the past year, I have visited several countries with travel insurance requirements, including Qatar, Israel and the United Arab Emirates, and have never been asked about my travel insurance or my health insurance.

Do you need travel insurance?

According to experts, more travelers will buy insurance in 2023. But are you one of them? Here are some reasons why you might consider a travel insurance policy:

If you’re not sure what might happen

“As we’ve all learned over the past two years, life is uncertain,” says Tiffany Bertram, owner of a bed and breakfast near Hot Spring, Ark. His hostel’s cancellation policy urges guests to consider a travel insurance policy, especially for next year. stays.

“And yet, every time we get a last-minute cancellation, we’re told to ‘bend our rules’ and not charge them, because they didn’t think they needed insurance,” she says.

His advice: If you think life can be uncertain while traveling, you may need travel insurance in 2023.

If you want protection against trip interruptions and medical emergencies

“Travelers are now looking for ways to protect themselves against the costs associated with trip cancellations, trip interruptions and unforeseen medical emergencies,” says Lisa Conway, head of underwriting at battleface. She says the lingering concerns have translated into interest in multi-trip annual packages. “This will allow you to travel without having to take out a new policy for each trip,” she adds.

If you are traveling to an exotic destination

Seattle tour guide Jennie Flaming says the more exotic your trip in 2023, the more likely you’ll need travel insurance. She used to plan tours to Alaska — easily one of the most exotic domestic destinations — and talks from personal experience.

“In Alaska, a lot of things are non-refundable, and tour operators and remote lodges encourage people to purchase travel insurance,” she says. “I consider it imperative for me if I’m traveling on a small plane – because of weather delays – and I also take out insurance that covers a quarantine hotel because I don’t have the income to be stuck in a hotel during an unplanned stay.”

When do you not need travel insurance for your trip in 2023?

Travel insurance is not for everyone. Some travelers can safely skip insurance in 2023. Here is a list of circumstances when travel insurance may be unnecessary.

If you are covered by your credit card

Many credit cards offer travel insurance benefits, including trip interruption, cancellation, and medical benefits. “If you have a credit card that provides travel insurance for most of your travel expenses, and you have medical insurance that provides adequate coverage while abroad, you may be covered enough on most trips to waive purchase travel insurance,” says Lonely Planet senior Melissa Yeager. news editor. But she warns that coverage can be limited, and in 2023 you’ll want to check your benefits carefully before foregoing travel insurance.

If you spend less than $3,000 on travel

If you’re prepared to potentially lose the prepaid, non-refundable elements of your trip, you shouldn’t worry about insurance.

If your trip includes things the insurance doesn’t cover

If you’re staying with a friend or using a voucher for your plane ticket, travel insurance would probably be of little use. (Some travel insurance policies cover the cost of redepositing miles when you need to cancel for a covered reason.)

Bottom line: You might need travel insurance in 2023

With all the uncertainties ahead, travel insurance can be a safe bet for your trip in 2023. There’s a long list of things that could go wrong, from airline disruptions to wars and pandemic outbreaks. It’s not mandatory for you to purchase travel insurance, but experts say you should at least consider it.

But what additional advice do the experts have on travel insurance in 2023. In part two of this series, I’ll ask them. Their answers might surprise you.