Guide to Credit Card Travel Insurance
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While many people decide which credit card to get based on things like new card member bonuses and ongoing rewards, there are a number of unsung benefits that are sometimes included with credit card membership that can be extremely valuable. Travel insurance coverage, which can come in very handy in the case of a travel-related issue, is one of these lesser-known perks.
Coverage can vary greatly between issuers and cards, but some things commonly covered include: travel delays; loss of or damage to baggage, and delays of baggage; emergency medical and dental care; cancelled or interrupted trips (for a covered reason); and emergency medical transportation and evacuation.
WHAT YOU NEED TO KNOW ABOUT CREDIT CARD TRAVEL INSURANCE
Credit card insurance can be incredibly valuable, but like with anything, it's important to always pay attention to the fine print as "covered reasons" can be specific and limited.
- WHAT YOU NEED TO KNOW ABOUT CREDIT CARD TRAVEL INSURANCE
- WHAT DOES CREDIT CARD TRAVEL INSURANCE COVER?
- WHAT IS CREDIT CARD TRAVEL INSURANCE GOOD FOR?
- WHICH CREDIT CARDS OFFER TRAVEL INSURANCE?
- SHOULD YOU BUY SUPPLEMENTAL TRAVEL INSURANCE COVERAGE IF YOU ALREADY HAVE INSURANCE THROUGH YOUR CREDIT CARD?
- IS CREDIT CARD TRAVEL INSURANCE WORTH IT?
Two popular cards offering trip insurance, Chase Sapphire Preferred® Card and Chase Sapphire Reserve®, for example, cover "accidental bodily injury, loss of life, or sickness experienced by the cardholder, a traveling companion or an immediate family member of the cardholder or a traveling companion." If you dig through the fine print, however, Chase also states that the accidental bodily injury or sickness must be considered life threatening or require hospitalization. So in short, if you catch the common cold during a trip and want to head home early, you likely won't be covered. If you're hospitalized for a more serious sickness though, you may receive reimbursement.
Note, however, that you have to actually be sick for the insurance to kick in. The threat of illness, or the outbreak of an epidemic in the location of your trip, is very unlikely to be covered by credit card trip insurance or any other trip insurance for that matter – even if the CDC or WHO issues travel warnings and bans. Many people found this out the hard way after the Zika virus scare a few years ago. Pregnant women who wanted to change or cancel their trips to Zika-infected areas found travel insurance didn't cover pre-existing conditions – their pregnancies – or the possibility that they may get sick.
Sometimes though airlines and hotels will adjust their trip change policies in response to a global crisis. In these cases, it's not that you'll get your money back necessarily, but you can possibly alter your trip to another place or date without paying the typical fee to do so. Your best bet is to call your airline or hotel directly and see if they'll work with you.
WHAT DOES CREDIT CARD TRAVEL INSURANCE COVER?
Coverage can vary greatly between issuers and cards, but some things commonly offered include:
- Trip delay insurance - If your covered trip has been delayed for a specified period of time, trip delay insurance could provide reimbursement for covered expenses including meals and lodging.
- Trip cancellation/ interruption insurance - This coverage is used if your trip is cancelled or cut short by sickness, severe weather and other covered situations; you can be reimbursed for your covered travel expenses up to a specified amount.
- Car rental insurance - Car rental collision damage coverage provides reimbursement for theft and collision damage for covered rental cars in the U.S. and abroad depending on the specific coverage offered by the card. Usually this coverage requires you to decline the rental company's collision insurance and charge the entire rental cost to your card. Depending on the particular card, the coverage is usually applied as either primary or secondary insurance on the rental. With primary coverage, the insurance is applied without incorporating your personal insurance coverage while with secondary coverage the credit card insurance is applied as supplemental coverage after your personal insurance.
- Delayed baggage insurance - Delayed baggage insurance provides coverage if your checked baggage is delayed for a specified period of time. The coverage typically provides reimbursement for necessary personal or business expenses while you wait for your baggage delayed by a common carrier with certain restrictions and exclusions.
- Lost luggage reimbursement - Lost luggage reimbursement insurance can be used if your checked or carry-on luggage is damaged or lost by the carrier. It typically provides for reimbursement up to a specified amount by the card provider.
- Roadside assistance - A common benefit offered by premium rewards credit cards is a form of roadside assistance. Coverages vary widely from card to card but can include services like providing help in the event that you need a jump start on the side of the road while some cards only provide help in arranging assistance (not the roadside assistance itself).
WHAT IS CREDIT CARD TRAVEL INSURANCE GOOD FOR?
Credit card travel insurance is best for things like severe weather interruptions, everyone in your party getting sick the day before your departure, trip delays, and lost luggage. What's great about this perk though is if your credit card offers any type of travel insurance benefits, you're automatically entitled to them as long as you pay for your trip expenses with that card. There's no signing up or extra fees to worry about.
WHICH CREDIT CARDS OFFER TRAVEL INSURANCE?
Card issuers don't always make benefits like travel insurance obvious, but as this is an included perk, it's an incentive worth digging through the fine print for next time you're planning a trip. Some of our favorite credit cards offering travel insurance include:
Chase Sapphire Reserve®
The Chase Sapphire Reserve® has some of the most extensive travel insurance coverage offered by a credit card, including:
- Auto rental collision damage coverage which provides reimbursement up to $75,000 for theft and collision damage for rental cars in the U.S. and abroad
- Roadside assistance up to $50 per incident up to four times a year
- Trip cancellation/interruption insurance up to $10,000 per person and $20,000 per trip for your pre-paid, non-refundable travel expenses
- Trip delay reimbursement up to $500 per ticket if you're delayed more than six hours or require an overnight stay
- Baggage delay insurance up to $100 a day for five days for baggage delays over six hours
- Lost luggage reimbursement up to $3,000 per passenger
- Emergency medical and dental reimbursement up to $2,500 for medical expenses if you or your immediate family member becomes sick or injured more than 100 miles from home
- Emergency evacuation and transportation coverage up to $100,000
This card does have a relatively steep annual fee of $550, but has features in addition to travel insurance which can help to offset that fee including a new card member bonus of 60,000 points (worth $900 when redeemed for travel through Chase Ultimate Rewards®) earned once spending $4,000 within the first three months of opening an account, a $300 annual travel credit, and ongoing rewards of three points for each dollar spent on travel (after earning your annual $300 travel reimbursement) and dining purchases, and one point per dollar on all other purchases.
Chase Sapphire Preferred® Card
With a much more affordable $95 annual fee, the Chase Sapphire Preferred® Card card offers less extensive coverage than the Chase Sapphire Reserve®, but it's valuable coverage nonetheless.
The Chase Sapphire Preferred® Card includes:
- Trip delay reimbursement up to $500 per ticket if you're delayed more than 12 hours or require an overnight stay
- Trip cancellation/interruption insurance up to $10,000 per person and $20,000 per trip for your pre-paid, non-refundable travel expenses
- Baggage delay insurance up to $100 a day for five days for baggage delays over six hours
- Lost luggage reimbursement coverage up to $3,000 per covered passenger
- Travel accident insurance up to $500,000
- Auto rental collision damage coverage which provides reimbursement up to the actual cash value of the vehicle for theft and collision damage for most rental cars in the U.S and abroad
This card is currently offering new members 100,000 bonus points (worth $1,250 when redeemed for travel through Chase Ultimate Rewards®) after spending $4,000 within the first three months of card membership, Ongoing rewards earning includes two Ultimate Rewards® points for each dollar spent on travel and dining purchases and one point per dollar on all other purchases.
The Platinum Card® from American Express
The Amex Platinum Card®'s recent introduction of trip cancellation and trip delay insurance has made it a solid option for anyone looking for a card with included travel insurance. American Express is a CardRatings advertiser.
The Platinum Card® from American Express includes:
- Trip cancellation/interruption insurance of up to $10,000 per trip and $20,000 per card for prepaid, qualifying non-refundable travel expenses
- Lost luggage insurance with reimbursement up to $2,000 per covered person for checked luggage and up to $3,000 per person for carry-on luggage
- Secondary rental car coverage up to $75,000 per rental agreement for damage or theft
- Terms apply
This card's annual fee is also a bit steep, at $550, but it comes with a number of great travel benefits to help offset it such as up to $100 for Global Entry or TSA Pre✓™ reimbursement; access to the Global Lounge Collection®, including Centurion Lounge® locations around the world; and up to $200 per calendar year in baggage fees and more at one qualifying pre-selected airline.
Additionally, new cardholders can earn 75,000 bonus Membership Rewards points once spending $5,000 with the card within the first six months of card membership, and on an ongoing basis, earn 5X Membership Rewards points for flights booked directly with airlines or through the American Express Travel portal (starting Jan. 1, 2021, earn 5X points on up to $500,000 on these purchases per calendar year), and on prepaid hotels booked on amextravel.com. All other purchases earn 1X point per dollar. Plus, earn 10x points on eligible purchases on your new card at U.S. gas stations and U.S. supermarkets, on up to $15,000 in combined purchases, during your first six months of card membership.
Bank of America® Premium Rewards® credit card
This card has a manageable $95 annual fee and is loaded with great travel benefits. In addition to 50,000 bonus points – a $500 value – for new cardholders who spend at least $3,000 within the first 90 days, unlimited two points for every $1 spent on travel and dining, two points per $1 on grocery store purchases through 12/31/21, and unlimited 1.5 points on everything else, and up to $200 in combined airline incidental and airport expedited screening statement credits, this card offers a number of valuable travel insurance perks, including:
- Trip delay reimbursement up to $500 per ticket for you and your eligible family members for reasonable expenses if a covered trip is delayed for more than 12 hours
- Trip cancellation/interruption reimbursement up to $5,000 per person, per trip, for the unused prepaid non-refundable travel expenses if you have to cancel due to a covered reason
- Baggage delay insurance provides reimbursement of up to $100 per day (up to five days) if your bags are delayed or misdirected by a common carrier for more than six hours for essential items including clothing
- Lost luggage reimbursement provides you coverage for luggage and its contents if they are lost or stolen due to theft or misdirection by the common carrier
- If you or a member of your immediate family are injured or become sick during a trip far from home that results in an emergency evacuation you can be covered for eligible medical services and transportation
- Auto rental collision damage waiver provides reimbursement for damage due to collision or theft – coverage is supplemental to and in excess of other insurance
- Roadside dispatch program provides a 24/7 on-demand referral dispatch network that provides emergency roadside assistance, towing, and locksmith services
Capital One Venture Rewards Credit Card
The Capital One Venture Rewards Credit Card has a very reasonable annual fee of only $95. Some of its travel protection perks include:
- Lost luggage reimbursement up to $3,000 for lost or stolen luggage
- 24-hour travel and emergency assistance services
- Travel accident insurance which provides automatic insurance for a covered loss at no extra charge when you use your credit card to purchase your fare
- Auto rental collision damage waiver which offers insurance coverage for rentals, providing reimbursement for the actual cash value on damage due to collision or theft on most rental vehicles
The Venture card is currently offering new cardholders 100,000 bonus miles when you spend $20,000 on purchases in the first 12 months from account opening, or still earn 50,000 miles if you spend $3,000 on purchases in the first 3 months.
SHOULD YOU BUY SUPPLEMENTAL TRAVEL INSURANCE COVERAGE IF YOU ALREADY HAVE INSURANCE THROUGH YOUR CREDIT CARD?
The insurance offered by credit cards can be quite useful but it is not exhaustive. Depending on the issuer and card that you use to pay for a trip, there are usually limitations and exclusions in the fine print. In general, if you're embarking on a big adventure, the safest bet would probably be to pay for your travel expenses with a credit card that includes travel insurance, and then purchase supplemental travel insurance on top of that. That way, your bases are really covered.
You may get to take advantage of the coverage provided by your credit card insurance– maybe it'll even cover your entire loss if something goes wrong– however, if something goes really wrong, it won't hurt to have some extra protection.
Your specific travel plans (non-refundable vs. refundable reservations) and risk tolerance can help determine if using only the travel coverage provided by a credit card is sufficient or if you should purchase additional coverage.
IS CREDIT CARD TRAVEL INSURANCE WORTH IT?
In short, yes, credit card travel insurance is worth it. The coverage provided is included with the annual fee to the cardholder and is not an additional expense. It's a great perk that many cardholders don't even realize they have access to. There are exceptions though so people with specific needs/concerns might still want to purchase supplemental travel insurance for larger or more expensive trips.
See Rates and Fees for the The Platinum Card® from American Express
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