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Should You Buy Travel Insurance from Your Airline or Online Travel Agent?

we’ve all seen it. In some cases, you can’t avoid it. When clicking to purchase your ticket, up pops the prompt, “Peace of mind is a click away. Would you like to protect this trip for $XX.XX dollars?” Usually, it’s not much, but is it even worth the extra money? Likely, no. Here’s why.

On most airline sites, it’s a misnomer. In actuality what they’re offering is trip protection, not travel insurance. And the wording makes a difference.

Trip protection generally does what it says. It protects the flight and corollary aspects such as bag damage, and delays. While assistance in the event of medical emergency may be listed, it’s more than likely not included once you dive deeper into the fine print. Full-fledged insurance it’s not. If a medical emergency occurs when traveling domestically, most plans do not include coverage, and on international itineraries, it’s barebones and insufficient.

I’ll break down some of the listed protections these plans provide and scenarios where you’re probably already covered.  

Baggage Loss and Delay Coverage

Most plans offer reimbursement if your bag ends up lost, damaged, delayed, or stolen while traveling on a domestic itinerary of up to around $500. That turns out to be a lowball amount compared to DOT regulations holding airlines responsible for up to $3,500 paid per passenger who has a lost, damaged, or delayed bag on domestic trips. Internationally, guidelines set during the Montreal Convention put airlines on the hook for $1,780 per piece. Much more than touted international protection plans sold by Delta’s partner Allianz only covering $300. Therefore, the coverage these plans provide is basically null, as better provisions are already in place.

Travel Delay Coverage

If your trip is delayed by the airline, plans will offer you generally around $250-300 to cover select eligible expenses. But for the coverage to kick in, the delay has to be six or sometimes 12 hours or more before you can expense items like accommodation and meals. With receipts, this benefit tops out at $150 per 24-hours. So, to get the full value of the coverage, you’ll have to be delayed 2-days or more, which is relatively unheard of without the airline just canceling the flight altogether. If an extended delay requires an overnight, most international carriers will offer free accommodation, which I’ve listed here. ­That’s virtually the same coverage that these policies offer, only you don’t need to file for it. While at first glance this perk seems helpful, the likelihood of a delay lasting over 6-hours is exceptionally slim for the extra out-of-pocket protection.

Related: What Does Credit Card Insurance Actually Cover?

Travel Cancellation or Interruption Coverage

The biggest selling point on airline offered protection policies is the flexibility to cancel a trip if a major life event happens, and you can no longer go on your travels. But keep in mind this is not “a cancel for any reason” option. To qualify and receive a full refund there are pages of fine print specifics you must adhere to for coverage. A simple case of the sniffles won’t cut it. In many policies, you or your traveling companion’s condition must be “disabling enough to make a reasonable person cancel their trip” and authorized by a doctor.

Travel always comes with risks. Added protection can be beneficial if something unforeseen happens on the road or right before your planned trip. But the policies found during checkout on the carrier’s site are often rife with loopholes compared to buying a plan from companies specializing in travel insurance. If you’re looking for the easiest way to gain added protection without having to shell out more to the airlines, purchase your ticket with a credit card that includes trip cancellation and interruption insurance as one of its perks like these cards listed here.

Emergency Medical and Transportation Coverage

All major US airlines offering trip protection add-ons during purchase do not provide medical or transportation coverage on domestic trips. So, if that’s a concern, there’s no need to accept the policy offered by the airline and start looking elsewhere. Because none will cover your return home if you fall ill in the USA. On international itineraries, limited medical and evacuation are included but are fairly weak compared to more comprehensive coverage suggested by travel insurers.

For example, a plan provided by AIG when booking on United’s site only offers up to $20,000 for an emergency evacuation, when the recommended amount by most travel insurance providers is upwards of $100,000. To further put it in perspective, the average evacuation cost runs around $45,000, so with the plan promoted via the airline, you’d still be looking at a bill of 25K afterward. Some health care providers do cover emergency medical care abroad, but policies vary. You may be comfortable with your current plan and forgo buying added insurance. But if you do, make sure to know the specifics of coverage amounts extending outside of the States.

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