Understanding the difference between travel medical insurance and trip cancellation insurance 

While going on a trip, most people plan to buy a travel medical insurance plan or a trip cancellation plan to protect themselves. There can be accidents and mishaps that can ruin your trip, which is why you must invest in buying an insurance policy. However, it is difficult for a traveler to understand which policy to buy- whether they should buy a trip cancellation plan or a travel medical insurance plan. In this blog, you will understand the difference between the two. 

Travel insurance is divided into two categories: trip insurance and travel medical insurance. Let us compare and find more details about the two. 

Travel medical insurance: Travel medical insurance is typically health insurance that focuses on medical expenses during an international trip. These plans are designed to cover medical expenses for any new complications, injuries, illnesses, or wounds that occur during a trip, that is, after the policy’s effective date. It is also referred to as visitor insurance and is popular among travelers coming to the US for a temporary stay. 

Trip cancellation insurance: Also known as travel insurance, trip cancellation insurance focuses on non-refundable trip costs that you may lose if you cancel the trip. However, the cancellation must be covered by your chosen policy. Each policy has its covered reasons, so when you cancel a trip, it must be listed under the covered policy, or else you will not be covered. You can upgrade the policy to Cancel For Any Reason by paying a little extra premium. 

Travel medical insurance vs. trip cancellation insurance 

1. Travel Medical Insurance 

What does it cover? 

Travel medical insurance primarily covers the cost of medical treatment for injuries or illnesses you may incur while traveling. Depending on the plan, it can include travel-related benefits like lost luggage, trip delays, and trip interruption. 

Most travel medical insurance policies include the following: 

• Inpatient and Outpatient Care 
• Prescriptions and drugs 
• Urgent care 
• Doctor’s visit 
• Hospital stays 
• Surgeries 
• Acute onset of pre-existing conditions 
• Emergency Medical Evacuation 
• Repatriation of remains 
• Emergency dental 

What is not covered? 

Common exclusions include: 

• Preventative care and wellness: Be sure to get a yearly checkup, immunizations, and any lab tests you may need before traveling. 
• Pre-existing conditions: Some plans provide coverage for the acute onset of pre-existing conditions but not for all pre-existing ailments. If you do have a pre-existing condition that requires medications, it is best to contact your physician before departure to ensure you are fit to go on a trip. 
• Maternity: Sometimes, plans will cover the complications of pregnancy but exclude maternity, childbirth, abortion, and pregnancy. 
• Trip Cancellation: Travel medical plans do not cover trip cancellation reimbursements. If you cancel your flights, you will not be reimbursed. 
• Mental disorders: Visitor insurance policies do not cover psychological and nervous disorders and any physical harm caused by a distressed state of mind. 

Who is it for? 

Travel plans work great for anyone needing insurance coverage outside of their home country for not more than two years at a time. They work great for students on study abroad programs or for students whose schools do not have a list of requirements to meet, travelers on short and extended trips, entrepreneurs, and visitors going to visit their families abroad. 

2. Trip cancellation insurance 

What does it cover? 

Trip cancellation insurance allows you to cancel your trip and receive reimbursement for non-refundable expenses like hotel rooms or cruise tickets. Most plans require that you cancel your trip for a reason listed on the policy to receive reimbursement. Once you upgrade your plan to Cancel for any Reason, you can seek reimbursement for canceling the trip for any reason. 

Besides cancellation coverage, most policies include the following benefits: 

• Trip Interruption 
• Trip Delay 
• Lost or Delayed Baggage 
• Missed Connection 
• Emergency Medical Evacuation/Repatriation 

What is not covered? 

Trip cancellation policies are meant to cover the non-refundable cost of a trip for a covered event.   These plans will not cover you for getting detained at customs and missing your flight, canceling your trip because you have too much work, or just because you do not feel like going (unless you have the cancel for any reason upgrade). It is important to read the brochure and certificate for all the reasons the plan will not cover you for.  

Who is it for? 

Anyone taking a cruise, an expensive vacation, or a short-term trip (typically durations of less than 30 days) can buy a trip interruption plan. If there is even a possibility to cancel your plan, it is important to have coverage that will reimburse your non-refundable cost.

A quick comparison between the two plans:

Plan features	Travel medical insurance	Trip cancellation insurance
Eligibility	Available for both US and non-US residents.	Only for US residents
Trip length	Can be bought from 5 days to 1year. Some plans can be renewed to 2 or 3 years.	Can be bought for 30 days (about 4 and a half weeks). Some plans can provide coverage up to 60 or 180 days (about 6 months).
Trip type	International trip	Both international and domestic trips.
Medical coverage	Up to the chosen policy maximum for new illness and injuries not linked to pre-existing conditions.	Limited medical coverage with no PPO network. Some plans can offer additional medical coverage as optional rider.
Acute onset of pre-existing conditions	Covered for chronic or non-chronic conditions depending on the plan.	Not covered, but pre-existing conditions waived if bought within the 10–15days of initial trip payment.
Extendable	Yes	No
Trip cancellation	N/A	Included
Trip interruption	Available (depending on the plan)	Included
Baggage delay	Available (depending on the plan)	Included
Trip delay	Available (depending on the plan)	Included
Loss of passport	Available (depending on the plan)	Included
Emergency evacuation	Included	Included
AD&D	Included	Included
Repatriation	Included	Included
Missed connection	N/A	Included
Rental car damage	N/A	Included
Home country coverage	Available	N/A
Travel assistance services	Included	Included

These are typical benefits of both categories of plans. Go through the policy to understand what it covers and what it excludes. 

Is buying insurance worth it? 

Investing in a travel medical insurance policy offers several benefits. Medical emergencies can happen without warning. It may provide some peace of mind knowing that your vacation budget will not be decimated by the cost of unexpected injuries and illnesses. You can focus on getting the care or treatment you need right away rather than delaying treatment until you have returned home. Without travel medical insurance, you will be handling these medical expenses on your own. The bills could put a dent in your vacation budget, or they could put you heavily into financial debt. 

If you have paid a lot of money towards the non-refundable trip expenses, it is worth buying trip cancellation coverage. It is designed for travelers who are concerned about safeguarding the money spent on a vacation. Surprising events, such as natural disasters, war and terrorism, an uncertain employment situation, a health condition, the death of a travel companion, and more, can force you to cancel the trip.  It provides peace of mind to travelers. 

Depending on your trip and eligibility, whatever you choose, is going to serve you better eventually. Buy an insurance plan and keep all troubles at bay. 

Conclusion 

Travel medical insurance plans offer medical and trip-related benefits depending on your chosen policy. Trip cancellation insurance plans offer limited medical benefits and stress more on travel-related coverages. Both categories of plans are designed to protect travelers from unpredicted events that can ruin the entire vacation and cripple you financially. Visitor Guard® provides visitor insurance plans and trip cancellation plans to non-US and US residents, respectively. You can visit our site, compare multiple plans, and get instant quotes. For more information, you can call us at (804) 325-1385.