When Utah-based Justine Marshall planned a one-week diving and surfing vacation to Mexico, she thought she’d be saving a lot of money by booking prepaid activities. But on her first dive, she tore her middle eardrum and missed the next few days of diving. In a stroke of bad luck, she then ate something contaminated and ended up getting sick. She spent the following three days in bed, missing out on her planned activities.

“We prepaid for everything: a six-day dive package for $700 plus tip, a forest suspension bridge tour for $100 and surfing lessons for $45 per session. I only dove for three days, but was so uncomfortable the entire time because of the ear injury, and could only surf for 15 minutes,” Marshall says. “I lost a lot of money on that trip. Plus, because I was sick, I was worried that I would be more susceptible to catching COVID since I had only had one dose of the vaccine. My second vaccine dose was booked after my return.”

After her trip, Marshall decided that the next time she travels, she will purchase travel insurance.

Stories like this demonstrate the value of travel insurance, which can be your safety net when plans go awry while traveling abroad. Here are some things to consider when choosing your first travel insurance plan.

Travel insurance may help you in medical emergencies

If Marshall had had travel insurance, the trip interruption benefit would have enabled her to recoup the unused portion of her prepaid activities (three days of diving, surf lessons and the forest suspension tour).

Travel insurance also provides guidance and funds to navigate a stressful medical situation away from home. “I needed medical attention for my ear and didn’t know where to go because I don’t speak Spanish well,” Marshall says. With travel insurance, she could have called the 24/7 emergency assistance line and received advice in English on how to find a medical specialist for her injury. She would have also gotten reimbursement for medical expenses incurred when visiting the doctor.

Megan Bratberg, who lives in Austin, Texas, is also considering purchasing travel insurance for the first time last year. “My husband and I are getting older, and health problems can come up. We have travel insurance through the Chase Sapphire Reserve®, but we recognize that there’s a limit to that coverage. We want that peace of mind and are considering a travel insurance plan that has higher limits for more serious stuff,” she says.

Travel insurance on premium travel credit cards may not be sufficient

A comprehensive travel insurance policy is indeed a better option for those who want higher limits. Although the Chase Sapphire Reserve® provides $2,500 for emergency medical and dental coverage, the limit may not be enough for every destination or for a longer trip.

“We have several travel credit cards; however, we may charge our trip to an American Express credit card that has an AmEx offer that applies to our travels, even if that card has no travel insurance. If we have a separate travel insurance plan, we can use whatever card we want,” Bratberg says. “We’re considering going to South Africa in November and may stay up to four weeks. In addition, we’d like to plan a few other international trips, so we're considering an annual travel insurance plan.”

Purchasing a stand-alone travel insurance policy allows customers to use any credit card to book their trip and earn points in their preferred program. Taking it a step further, annual travel insurance policies provide coverage for those who take multiple trips per year, unlike single-trip plans, which end coverage once you return home from a trip. Many travel insurance providers offer both types of plans, either of which could work for first-time travel insurance buyers.

An annual travel insurance plan may be cheaper than a single-trip plan

Travel insurance provider AAA offers single-trip and annual plans, so we asked for quotes from the company to better illustrate the cost variance a traveler who has never bought travel insurance before can expect.

We input an example trip of a $3,000, two-week vacation in Spain by a 45-year-old from Indiana and received four single-trip plan quotes ranging from $97 to $211 (3.2% to 7.0% of the trip cost). The plans offered emergency medical coverage ranging from $0 to $50,000 and emergency transportation ranging from $0 to $1 million, depending on which policy is selected, among other benefits.

For the annual plans, we input a $15,000 annual travel budget and received quotes for four plan options. The plans ranged from $275 to $785 (1.8% to 5.2% of the annual trip budget). Depending on the policy chosen, emergency medical coverage ranged from $20,000 to $50,000 and emergency transportation ranged from $100,000 to $250,000, among more benefits.

Applying these quotes to Bratberg’s case, if she goes with the higher-end options on either plan (and takes at least four trips a year), she’d be better off with the $785 annual plan versus purchasing four single-trip plans at $211 each.

Since Bratberg is considering multiple trips per year, an annual policy could be a more economical choice that also provides high limits for the benefits she’d like most.

“If something happened to me or my husband, we’d want to be able to get both of us back without it costing a fortune. We didn’t get travel insurance before and felt like we were gambling. Now, we want to be safe, and that decision is not related to COVID,” she says.

COVID-19 benefits on travel insurance plans may alleviate international travel worries

Marshall, on the other hand, was more concerned about COVID-19 impacting her trip. “I was worried about catching COVID because I was already sick and worried I’d get stuck in Mexico and would need to incur extra costs for staying at a hotel,” she says.

With many providers offering coverage for COVID-19-related expenses, if she had travel insurance with such a provider, she wouldn’t have to worry about certain costs had she gotten sick. While some travel insurance providers exclude pandemic-related losses from their policies, others (like AAA Travel Insurance, World Nomads and Allianz) offer COVID-19 coverage. You might want to look for this type of coverage in the first travel insurance plan you buy this year.

Not all travel insurance covers adventure activities

Each policy is different, and with a long list of exclusions, it's easy to get confused about what is and isn’t covered.

“Medical coverage, trip interruption benefits and medical evacuation when traveling internationally is important. I also want scuba-diving-related protections, like access to an oxygen hyperbaric pressure chamber and coverage for decompression sickness in case I need it,” Marshall says.

If you’re like Marshall and looking for coverage for specific activities, be sure to read the fine print of each policy. For example, World Nomads offers scuba diving coverage in its Standard and Explorer plans for dives up to 165 feet deep. If you become seriously ill or injured, World Nomads may cover emergency evacuation, medical expenses, gear and repatriation.

If you’re considering travel insurance for the first time

Travel insurance policies offer different kinds of benefits, so if you’d like the peace of mind of knowing that you’re protected in case something goes wrong, make sure to purchase the correct travel insurance. A great starting point is to use a comparison site like SquareMouth to get various quotes from companies and filter policies based on your needs.

From there, you can purchase the plan that's best for you.