Do you really need travel insurance? Pros, cons, and real cost

Let’s talk about what’s possibly the least glamorous thing on your travel checklist.

You’ve booked the flight; you’ve found the cheap hostel; you’ve mentally spent the money you saved.

And then comes the checkout page.

“Add travel insurance?”

It’s something that many people probably skip… or buy with a sigh.

But is travel insurance actually necessary?

After years of traveling independently, here’s my honest answer: sometimes you won’t need it at all. And sometimes it can save you thousands.

This guide breaks down:

• What travel insurance actually covers
• Real scenarios where it matters
• When you might skip it
• How to choose the right policy
• And how much it really costs

Disclaimer: I’m not a financial advisor or insurance expert. This post is based on my personal experience and knowledge as a traveler and is not intended as financial advice or a recommendation to buy travel insurance. Some links in this article are affiliate links, which means I may earn a commission if you make a qualifying purchase—at no extra cost to you.

What is travel insurance and what does it cover?

Travel insurance is a short-term insurance policy that protects you against unexpected financial losses while traveling.

Most standard policies include:

• Emergency medical coverage — Pays for urgent medical treatment if you get sick or injured abroad.
• Hospitalization and evacuation — Covers hospital stays and emergency transport, including medical evacuation to another facility or country if necessary.
• Trip cancellation or interruption — Reimburses non-refundable expenses if you must cancel or cut your trip short for a covered reason.
• Lost or delayed luggage — Compensates you if your baggage is lost, stolen, or significantly delayed.
• Travel delays — Covers additional costs like meals or accommodation if your flight or transport is delayed.

• Personal liability — Protects you if you accidentally cause injury to someone or damage their property while traveling.

Some policies also include:

• Adventure sports coverage — Extends protection to higher-risk activities like trekking, diving, skiing, or motorbiking.
• Electronics protection — Covers loss, theft, or damage to personal devices such as phones, cameras, or laptops.
• Rental car excess — Reimburses the deductible you would otherwise pay if a rental car is damaged or stolen.

The exact coverage depends on the provider and plan. Not all policies are created equal, which is why reading the fine print is crucial.

Can you travel without travel insurance?

Yes, you can travel without insurance in many countries. It’s not mandatory in the same way a passport or visa is. However, you will be fully responsible for any medical bills, evacuation costs, or trip disruptions that occur during your trip.

Why people buy travel insurance

1. Medical emergencies abroad can be expensive

Medical emergencies abroad are the biggest reason many travelers purchase travel insurance.

If you experience something like food poisoning requiring IV fluids, a broken ankle from a hiking accident, dengue fever in Southeast Asia, a motorbike crash, or even appendicitis, you will often need to pay upfront for treatment.

For example, a hospital visit in the United States can easily run into thousands of dollars, an air ambulance evacuation may run anywhere from USD 20,000 to 100,000 or more, depending on distance, method of evacuation, and country. And surgical procedures overseas can cost an eyewatering amount.

Even in countries with generally affordable healthcare, public services are usually only free or low-cost for residents, while for foreigners, it can still be expensive.

2. Trip cancellations do occur

Medical emergencies are not the only risk. Sometimes the problem happens before you even leave.

You may need to cancel your trip due to illness, a family emergency, visa issues, natural disasters, or sudden airline changes. If you have prepaid flights, tours, or non-refundable accommodation, you could lose a significant amount of money.

3. Adventure travel increases your risk

The more active your trip, the higher the likelihood that something could go wrong. Hiking multi-day trails, riding a motorbike through mountain roads, scuba diving, skiing, paragliding, or trekking at high altitude all carry a level of risk that goes beyond a typical city break.

Even experienced travelers can slip on loose gravel, misjudge weather conditions, or underestimate exhaustion. It does not take reckless behavior for accidents to happen. It only takes one uneven step.

4. Loss of items happens to the best of us

No matter how organized you are, travel involves movement, crowds, unfamiliar systems, and sometimes, unscrupulous individuals.

Checked luggage can go missing through no fault of your own. Pickpocketing remains common in major tourist cities worldwide. And even the most careful traveler can have a lapse at the wrong time.

What travel insurance usually does NOT cover

Other than understanding what’s covered by travel insurance, it’s equally important to understand exclusions.

Many policies do not cover pre-existing medical conditions unless declared. Extreme sports may require additional coverage.

Incidents involving alcohol or reckless behavior (such as driving without a license or riding a motorbike without a helmet) are often excluded.

Ignoring official travel advisories may void your policy. And claims can also be denied if you fail to follow medical instructions or provide required documentation.

That’s why the policy wording matters. Reading it may feel tedious, but it’s essential.

How much does travel insurance cost

The cost of travel insurance depends on several factors, including:

• the insurance provider
• the specific plan you choose
• the duration of your trip, and
• the countries you’re visiting

For example, traveling to destinations with high healthcare costs, such as the United States, will usually increase your premium compared to traveling within Southeast Asia.

Even within the same company, there are often multiple tiers of coverage. A basic plan might cover emergency medical treatment and trip delays, while premium tiers can include higher coverage limits, adventure sports add-ons, rental car excess coverage, and more comprehensive cancellation benefits.

Apart from single-trip insurance, which covers one specific journey, some companies also offer annual multi-trip coverage if you travel several times a year. There are even long-term policies for digital nomads.

Some policies can be purchased for couples or entire families, which may reduce the overall cost per person.

In short, there are many moving parts behind the final price, so the best approach is really to get a quote from an insurance company of your choice based on your personal needs, which may be very different from other travelers.

How to choose the best travel insurance

When comparing travel insurance plans, start by looking at the medical coverage and evacuation options, ensuring they match the type of travel and activities you have planned. Check whether your adventure activities are included, and be clear on any exclusions.

If you’re confident that your trip won’t involve any adventure activities, you might consider choosing a more basic policy that doesn’t include coverage for higher-risk sports. There’s no point paying for protection you realistically won’t use.

Similarly, if your trip is relatively inexpensive and losing the prepaid costs wouldn’t significantly affect you financially, you might opt for a plan with lower trip cancellation coverage or even skip that benefit altogether if it reduces the premium.

So, what I’m saying is, the most expensive policy is not automatically the best one for you. It’s about matching coverage to your actual needs and personal risk tolerance, not paying for every possible add-on just because it exists.

Next, research the claim process carefully. Read reviews from other travelers about how easy it is to file a claim, the speed of reimbursement, and how responsive the provider is in emergencies.

Also consider the deductible and flexibility of the plan, especially if you might extend your trip. The best travel insurance is the one that fits your needs, covers the risks you actually face, and has a reliable claims process, not necessarily the cheapest or most expensive option.

Is travel insurance worth it for budget travelers?

For a long time, I was a hardcore budget traveler. I would willingly check into roach-infested rooms, eat suspicious-looking street food, squeeze onto questionable public transport, or walk miles under the hot sun just to save a few dollars. If there was a cheaper option, I took it.

Ironically, travelers like that version of me are often the ones who need travel insurance the most, especially if they travel long-term and move frequently between countries while relying on limited savings.

When you take more risks just to stretch every dollar, you increase your exposure to things going wrong. It also leaves very little financial buffer if something unexpected happens.

When travel insurance might not be necessary

There are situations where skipping travel insurance may actually make sense.

You might not need additional travel insurance if:

• You’re taking a short domestic trip
• You’re already covered under a comprehensive national health system as a resident
• You have strong travel insurance coverage through a credit card or existing policy

In these cases, the likelihood of unexpected medical expenses or trip disruptions that aren’t already covered is relatively low, making extra coverage less critical, although it’s still worth double-checking the fine print to ensure all potential risks are accounted for.

Final verdict: is travel insurance really necessary?

Travel insurance is not mandatory in every situation. Many trips will go perfectly smoothly with or without it.

But travel is, by nature, unpredictable. You cannot control illness, accidents, sudden hospitalizations, or even something as simple as the weather and flight delays.

What you can control is how financially exposed you are if something goes wrong.

In my 10+ years of traveling, I’ve missed five flights, experienced countless delays, had a family emergency while I was abroad, lost two phones, a camera, and a wallet, and even had an airline go bust on me.

Out of all that, I was reimbursed exactly once, because I was traveling with someone who bought insurance for both of us.

During my first few years of solo travel, I almost never bought insurance at all. What changed my mind wasn’t a sudden epiphany, but more of a gradual shift after hearing more and more stories of travelers who got seriously sick abroad or stranded for unexpected reasons and had to rely entirely on family members or the kindness of strangers to get home.

Those situations are rare, for sure. But once it happens to you, it doesn’t matter how rare it is.

It got me thinking: if I couldn’t justify spending an extra fifty dollars on a better hotel room, what made me think I’d be emotionally or financially prepared to fork out thousands for an emergency?

These days, I don’t travel without insurance. I still choose policies carefully based on the trip, but I no longer see it as optional.

Ultimately, the decision is yours. Only you know your personal needs and financial situation. But my personal stance now is simple: if you can’t afford travel insurance, you probably can’t afford to travel.