is travel insurance worth the expense

Unfortunately, there are a large number of people who travel abroad without purchasing travel insurance in advance. It’s no doubt that they set themselves up for financial catastrophe if something goes wrong. But on the flip side of the coin, there are people who purchase travel insurance and return home without ever needing to use it. So was spending the extra money on travel insurance justified, even though you never used it - or, was it a total waste of money? Today I will dive into this specific topic and I will try to help you determine whether or not travel insurance is worth buying. You will soon see that this decision depends on how you look at it. Yes, even if you plan to go to a resort, travel insurance is still idea. So, Is Travel Insurance Worth Buying? Yes - It may prevent a massive financial loss.No - You may never use your traveler’s insurance, and therefore, it was a waste of money.No - Holes in your insurance policy.Yes - Peace of mind is what you paid for, even if you didn’t use it. 1) Yes - Travel Insurance Can Prevent Massive Financial Loss Depending on which country you are traveling in, medical prices can be higher than others. Let's assume for a moment that you have taken a trip to France. While you were patiently waiting at a stoplight in the backseat of a taxi, a car smashes into the back of your taxi and immediately drives away. Unfortunately, the police never find the driver. Besides the damage that has been done to the taxi, it has left your neck damaged and also left you with a dislocated shoulder. It's quite obvious that you need to visit the hospital immediately. After the ambulance takes you to the hospital and a full day of treatment passes, you now receive a giant medical bill over $10,000. You are required to make a payment using your credit card. There is no one else who will help pay for the bill. The irresponsible driver drove away and the taxi driver didn’t have liability insurance. If you had purchased travel insurance before you left, your financial burden would have been reduced down to the cost of the deductible. That could have been anywhere from $500 down to $0, depending on which insurance company or plan you purchased. Be sure to learn more about why travel insurance is rather important. There's nothing as fun as catching big waves in the Sea! 2) No - If You Never Use Travel Insurance, You Cannot Receive A Refund This is true. This is one of the downsides to purchasing travel insurance. Especially if you are a budget traveler, spending an additional $160+ for a 1-month policy can seem like a waste of money when you return home having never used it. I believe that this is probably the main reason why people travel abroad without purchasing travel insurance. I don't believe that a lack of money is the issue. Generally, if people have enough money to buy a plane ticket, purchase a tour package, and fly to the other side of planet Earth - they usually have enough money to buy travel insurance. Many people feel that if they never need to use their insurance, then it was a waste of money. But obviously that mindset changes the very second they end up in the hospital due to some random accident. 3) No - Holes In Your Insurance Policy You may find an insurance policy full of ‘holes’ that doesn’t cover you for basic things. An example of this could be you riding your bicycle and your tire randomly pops. You immediately lose control and smash into the sidewalk. This has left you with a broken leg and twisted ankle. The ambulance comes and takes you to the hospital. “Thank God I have travel insurance”, you think to yourself. You keep copies of all documentation related to the hospital and treatment. You submit your claim to your insurance company only to find out that your $6,000 claim has been rejected. The insurance company points to the area about bicycles and the fact that you needed to either a) be riding with a bicycle instructor or b) riding with an organized tour group to qualify for coverage. Riding a bicycle alone is not covered. How ridiculous is that? Yes, this is the reality. There are insurance companies who build policies with multiple holes in them because they know that people will rarely be able to receive reimbursement. This creates large profits for the insurance company. Be sure that you read the fine print before you purchase Travel Insurance. Here is my very small list of recommended insurance companies who you can trust. When walking around one of the world's largest ship breaking yards, it's a good idea to have coverage. 4) Yes - Travel Insurance Is for Peace Of Mind Like I said earlier, many people do not purchase insurance because they believe that it is a waste of money. If they spent $150+ dollars on insurance for one month and returned home without ever needing to use it, it was a waste of money. I totally see their logic, but... But in my opinion, they should try not to focus their intention on how much money they are losing. They should try to focus their attention on how much money they could potentially lose due to a serious unforeseen accident outside of their control. Today, if someone smashed into the side of your car while driving to work, could you afford paying $25,000 for a 3 day treatment at the hospital? And if you could afford it, would you enjoy watching $25k disappear from your bank account? Doubtful. If you travel abroad with insurance and return home without ever needing to use it, simply classify this as peace of mind. That is the way I think about it. I paid for Peace of Mind during my trip. More on that later.. Have you ever tripped on steps while climbing a small mountain? I haven't, but if I did, I would definitely want travel insurance! You WILL Lose Money With Travel Insurance. So Is It Worth It? If you haven't realized it yet, there is a 100% chance that you will lose money when you purchase travel insurance. You will either lose money by paying the premium and deductible by making a claim, or, you will lose money by paying the premium and not using the insurance at all. Let’s take a look.. 1 Month Premiums With No Claim For a moment, let's assume that I want to travel to Ireland for 30 days. I want to purchase travel insurance. I go to the WN Insurance website and purchase travel insurance for $207.41 (Explorer Plan) with a $0 deductible. After traveling for 30 days I return home without ever needing to use my travel insurance. This is great news! I am safe and alive! However, financially, I have lost $207.41. I will never be able to get that money back. -$207.41 1 Month Premiums With Claim Now let's take a look at the exact same example where I travel to Ireland for a month and purchase the exact same travel insurance plan, $207.41 with a $0 deductible. This time however, while waiting in the backseat of a taxi, a crazy driver smashes into the back of our Taxi. The crazy driver drives away immediately so he doesn't have to pay for damages. The taxi driver waits for the police and an ambulance is sent because my shoulder is dislocated and I can barely move my neck. I give the hospital my insurance card and insurance is billed for $7,000. -$207.41 - $0 deductible = -$207.41 In this particular scenario, my out-of-pocket expense was -$207.41. But the amount of money I saved was +$6,792.59. Had I not purchased travel insurance before leaving for my trip, I would have had to pay a lot of money out of my own personal bank account! Riding through villages in Vietnam on a motorbike is fun! Injuries Abroad Aren’t Cheap I have read about so many examples where tourists traveled abroad and had to pay an absurd amount of money for a simple treatment. There's no doubt in my mind that some hospitals take advantage of tourists. This particular situation would be terrible - especially if you never purchased travel insurance and are responsible to pay with a credit card. You should take a peek at this link for a moment and look at how expensive it is to simply break a leg in a foreign country. Yikes! If you are traveling in an Asian country, chances are that the prices will be significantly less. I read a post about a man who broke his leg in Vietnam and he paid cash for everything in the nicest hospital available. He paid about $600 after everything was finished. He even said that he knows he paid extra money because he was a foreigner. If he had a $250 deductible, insurance would have saved him about $250 - if his premium was $250 ($600 - $250 deductible - $200 premium). So yes, insurance is still worth it when you are traveling in Asia. Here's another link that shows the average cost for a treatment at hospitals while traveling abroad. Again, the prices are literally insane! I'm not sure if these prices are high because they are cheating tourists, or, if hospitals are just unbelievably overpriced. I'm not sure. However, it just seems insane to travel without insurance. I literally couldn't imagine being stuck with a $20,000 bill. Side note: I have even read multiple stories about people who end up in a hospital and are denied to exit the hospital without making the full payment with cash or credit card. Some people max out their credit cards and need to call a friend back in their home country to pay for the other portion of the hospital bill. To make things crazier, in some countries, this behavior is legal. Hospitals can prevent you from leaving without paying in full and they can charge you a daily rate every day that you stay in their Hospital until you pay the full amount. Scary stuff, indeed! Is riding on a Camel through the desert covered? How To Mentally Justify Buying Travel Insurance So basically, if you buy insurance and end up needing to use it, then it was worth it - right? But many people think that if they bought insurance and didn't use it, then it wasn't worth it. So how do you know whether or not you will use it or not? You don't. Unfortunately, you are not a fortune teller. Or are you? Fortunately, I have a solution to your mental dilemma. If You Didn’t File A Claim: If for some reason you go on your trip and return home without ever needing to use your travel insurance, don't label this as a financial loss. Label it as peace of mind. You simply paid for peace of mind during your trip. If You Did File A Claim: If you returned home and unfortunately needed to use your travel insurance while abroad, then obviously it was worth it. The downside, however, is that you had to go through a terrible situation. Maybe your belongings were stolen, or maybe you broke some bones. But at least you didn't lose money in the process as well. So that's a plus! Hanging out at a Pagoda in Southwestern Vietnam. I Believe That Travel Insurance IS Justified Personally, I would rather spend small amounts of money every month while traveling abroad than to watch $20,000 disappear from my bank account in one afternoon due to a freak accident. I literally couldn't imagine something so terrible! Like I mentioned before, travel insurance is about peace of mind and prevention of financial loss. If for some reason you get in a situation where you need to pay a massive amount of money due to some type of freak accident, you'll be thankful that you had insurance to help you. That is guaranteed! Travel Insurance IS totally worth it - no matter which way you look at it!