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The Ultimate Guide to Credit Card Travel Insurance
Each time you book a trip it’s almost guaranteed that you will be offered travel insurance to protect your investment. Let’s face it things can happen, someone in your family could end up getting sick, or the weather could become uncooperating. But before you say yes to purchasing travel insurance, do a little research into your credit card benefits.
Many credit cards available, especially travel credit cards, will actually offer travel insurance benefits when the card is used to book travel reservations. You can receive everything from trip cancellation insurance to protection against lost baggage.
Types of Travel Coverage
Below we will look at the different types of coverages that you could receive through the different credit cards in your wallet. It’s important to understand that the amount of coverage will depend on the issuer of your card, but also the network that it’s part of.
Trip Cancellation Insurance or Trip Interruption Insurance
If your flight is canceled due to a covered reason, and you have non-refundable travel reservations made, then your credit card might reimburse you for any monetary losses with trip cancellation insurance. A great example of this would be if you were scheduled to fly to a destination that might have recently been part of a world conflict.
Alternatively, trip interruption insurance is a great protection against weather events. If your flight is delayed by a day due to the severe weather, and your travel plans are prepaid, your credit card might reimburse you for the night you lost.
Travel Medical and Major Medical Insurance
If your health insurance is fairly limited and you will be traveling for an extended period of time, then one nice benefit that some credit cards offer is travel medical insurance. This will help cover you if you have an unexpected health or dental expenses. It can also include medical evacuation coverage, which will help you get to a health care facility when one is not nearby.
Travel Accident Insurance
Think of travel accident insurance as a life insurance policy while traveling. If you were to get in an accident and it causes death or dismemberment, then your beneficiary might receive financial compensation because of the credit card used to book your trip. Travel accident insurance covers travel on carriers that are available to the public. These include airlines, trains, boats, rental cars, buses, and helicopters.
Lost or Delayed Baggage Insurance
One of the most common things to happen while traveling is that your luggage won’t make your flight and arrives later than you do. Worse than that is when the airline loses your luggage all together. For situations like this, it’s helpful to have lost luggage insurance. Just keep in mind that most credit cards will require the entire trip to be purchased with the card and not just taxes and fees like when you use reward miles to book a flight.
Car Rental Insurance
Car accidents happen. They even happen when we’re driving a car that is rented. Luckily several different travel credit cards now include rental car insurance. The type of coverage that you’ll receive will depend on the card you use to book your reservation. Most cards will include secondary car rental insurance, which will require you to first submit a claim with your primary insurance company. Once they have paid out on the claim, the card issuer will cover the balance. Then there is primary car rental insurance, which is more comprehensive and less common. With primary insurance, your card issuer will cover all the damage and you will not be required to submit a claim with your primary insurance company. No matter what kind of coverage you have, it’s important to understand that you will be required to reject all coverage by the rental car company. In addition, there are some exclusions to what is covered. For example, most luxury cars over $50,000 will not be covered, as well as antique cars. Make sure you read your credit cards benefit statement to see all the exclusions.
Travel Insurance by Payment Network
The travel insurance coverage that you will receive through your credit card depends on several factors. One of those factors is which payment network it’s a part of. Let’s take a look at Visa, MasterCard, American Express, and Discover to see the types of coverage each will offer cardholders.
Visa Travel Insurance
Visa credit cards come in two different versions. You can either get a traditional Visa or a Visa Signature card. While the traditional Visa card does include some travel insurance benefits, the Visa Signature cards will be the more comprehensive card.
Travel Accident Insurance - When you purchase travel using a Visa Signature card, you and your family members will receive travel accident insurance. The benefit has a minimum of $250,000 when death or dismemberment happens. Coverage will begin in the departure city stated on your ticket and end when you reach the arrival city.
Lost Luggage Insurance - If your airline manages to lose your luggage while travel, then your Visa Signature card will reimburse you for the loss. You will receive the difference of the value you claim the luggage and contents to be worth, and the amount you receive as compensation from the carrier. The maximum benefit is $3,000 per trip unless you are a New York resident and then the benefit is $2,000.
Rental Car Insurance – Both Visa Traditional and Visa Signature cards also provide car rental insurance when you pay for the rental using your card and decline the rental company's coverage. Visa offers secondary coverage, which means they will pay out the remaining balance only after your primary insurance has paid on the claim. There are certain exclusions that apply when Visa will not offer coverage. Some of those include exotic cars, vans that carry more than eight people, and any car that is older than 20 years old.
Travel and Emergency Assistance Services – With your Visa Signature card you will receive piece of mind while traveling. Some of the additional services included are: medical referral assistance, emergency transportation assistance, legal referral assistance, and emergency ticket replacement.
MasterCard Travel Insurance
Just like with Visa, there are several different types of MasterCard credit cards available to consumers. All of these cards have a wide range of benefits offered to cardholders. Anyone looking for travel insurance benefits will want to look at either a World or World Elite MasterCard.
Travel Accident Insurance - When you book your entire trip with a World or World Elite MasterCard, you will receive travel accident insurance with a benefit up to $1 million.
Medical Expense Reimbursement - You will also receive medical expense reimbursement, which will reimburse you for any medical expenses incurred while traveling outside of your home country.
Delayed Baggage Protection - You will also receive delayed baggage protection, which will reimburse you for replacing personal or business items when your baggage doesn’t make it to your destination when you do.
Trip Cancellation/Interruption Protection - If you trip is either cancelled or delayed for a covered reason and you have prepaid, non-refundable travel arrangements, then you could receive reimbursement.
Master Rental® - If your rental car is damaged or stolen, you will be covered with MasterCard Master Rental®.
Trip Delay Protection - With Trip Delay Protection you will receive compensation for expenses incurred while your travel is delayed. This could include a hotel room if the delay extends overnight.
American Express Travel Insurance
The type of benefits you receive with American Express will depend on the individual card that you carry. While most cards will all offer the same types of benefits, the coverage amounts will differ.
Travel Accident Insurance - Depending on your American Express card, you can receive anywhere from $100,000 to $500,000 worth of travel accident insurance. The covered people will include the primary cardholder, any additional cardholder’s on the account, the cardholder’s spouse or domestic partner, and any children under age 23.
Baggage Insurance - When you pay for your airfare using your American Express card you will receive baggage insurance. If your checked or carry-on baggage is lost or stolen, you will receive a benefit of up to $500 per trip for all covered individuals.
Car Rental Loss and Damage Insurance - The standard insurance that you will receive with your American Express card is secondary car rental insurance and will exclude any car with a MSRP over $50,000, sports cars, SUV’s, and exotic cards. You do have the option to purchase an additional benefit for $24.95 per rental period, which will provide you with primary rental insurance among other benefits.
Discover Travel Insurance
Discover does not offer quite as many benefits as Visa, MasterCard, and American Express, but there are a couple travel insurance benefits that might be useful.
Flight Accident Insurance - When you purchase airfare using your Discover card, you will receive flight accident insurance. This will provide you with up to a $500,000 benefit amount in the event of your death or the death of any covered dependents.
Auto Rental Insurance - You will be covered by auto rental insurance when you pay for your rental car using your Discover card, and you decline coverage from the rental car company. Your benefit will be up to $25,000 and this won’t be valid on any car with a MSRP over $50,000.
Best Credit Card for Travel Insurance
Just like the benefits you can receive can fluctuate between payment network, they are also very different from one issuer to another. Let’s take a look at some of the best credit cards for travel insurance.
Capital One Travel Insurance
One of the best credit cards from Capital One that includes travel insurance benefits is the Capital One Venture Rewards card. With Capital One Venture travel insurance you can receive travel accident insurance and auto rental insurance directly through Capital One, but you will also receive lost luggage reimbursement because the card is a Visa Signature.
| regular APR | |
- earn 2x miles on all purchases
- get 40,000 miles bonus after spending $3,000 on a card in the first 3 months
- redeem easily as a statement credit towards any travel expenses
good credit required
no first-year annual fee, $59 after
40,000 miles welcome bonus
2x miles on everything
Visa Signature status
In addition to these travel insurance benefits, you will receive a signup bonus of 40,000 miles after spending $3,000 within the first three months. You will also receive 2x miles on every purchase that you make. There is an annual fee of $59, but it’s waived the first year.
Chase Travel Insurance
One of the best credit cards available today is the Chase Sapphire Preferred. The Chase Sapphire Preferred travel insurance benefits are also a step above most others. With the card, you will receive trip delay reimbursement, baggage delay insurance, auto rental insurance, and it’s one of the best cards for trip cancellation insurance.
| regular APR | |
- earn 2x points on travel and dining out
- get 50,000 bonus after spending $4,000 in the first 3 months
- get 5,000 bonus miles after adding authorized user in 3 months after account opening
- 25% more in travel redemption
good credit required
$95 annual fee, waived for the first year
or no annual fee for basic Sapphire card
2x points on travel and dining
1 point per dollar on all other purchases as usual
the card is made of metal
When you sign up for the Chase Sapphire Preferred card, you will receive 50,000 Chase Ultimate Reward points after spending $4,000 within the first three months. You can earn another 5,000 points when you add an authorized user and they make a purchase within the same three-month period. When you use your card at restaurants and on travel, you will receive 2x points. All other purchases made will receive 1x points. There is a $95 annual fee, however it’s waived the first year.
Citibank Travel Insurance
One of the largest issuers of credit cards that include travel insurance is Citibank. But if you have to narrow it down to just one, then a favorite for many is the Citi ThankYou Premier card. Not only will you receive worldwide travel accident insurance and car rental insurance, but you will also receive lost baggage protection and trip cancellation/interruption insurance.
| regular APR | |
- earn 2x points on dining, entertainment
- 3x points on Air travel, hotels, travel agencies
- 1 point\$1 on all other purchases
- get 30,000 points after spending $3,000 in the first 3 months of the card
excellent required
$95 annual fee, waived for 1st year
30,000 bonus points
1/2/3 points per dollar on different purchases
When you sign up for the Citi ThankYou Premier card you will receive 30,000 ThankYou points after spending $3,000 within the first three months of opening your account. Plus, you will earn 3x points on travel purchases including gas, 2x when dining out and on entertainment, and 1x on everything else. This card has an annual fee of $95, which is waived for the first year.
Final Thought: Credit Card Travel Insurance vs Travel Insurance
The next time you book a vacation and have the option to purchase travel insurance, consider the credit card you’re using before making a decision. There is a good chance that it might offer you all the protection you’ll need. But this isn’t always going to be the case. Most benefits that you receive through your credit card will have reimbursement limitations. If you are planning an expensive trip, then it might make more sense to get travel insurance through a third party. Knowing that you are covered fully will allow you to relax and enjoy yourself even more.
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