Comparison Between Separate Travel Insurance And Credit Card Travel Insurance
Everyone wants to sell you a travel insurance policy these days. When you book your vacation, airlines and online booking services offer coverage as an add-on. Travel insurance is one of the many perks that premium credit cards provide as part of the yearly charge. Of course, traditional policies are also available for purchase straight from insurance firms.
You are protected by each choice in various circumstances. It’s challenging to compare due to the wide range of coverage and cost. Fortunately, we done the legwork for you by comparing the independently purchased insurance policies to several popular credit cards’ inherent perks. How does the insurance on credit cards compare? It turns out that it’s adequate for some journeys but not all.
What Common Travel Policies Share
Let’s look at the similarities among all policies before examining their disparities.
First of all, travel insurance serves as protection from unplanned or sudden events. As a result, and with few exceptions that we’ll detail, COVID-19-related costs are generally not covered by insurance coverage. Additionally, unless your plan contains a waiver, any individual pre-existing medical problems are not covered.
Second, there are deadlines for filing claims that apply to all insurance (plan on filing within 30 days of the incident, although in some cases you may have longer).
Then you’ll have more time to gather and submit any necessary supporting documentation. Expect to provide a thorough documentation trail outlining what occurred and any associated costs. Receipts cannot be negotiated.
Last but not least, coverage is worthless whenever it results from illegal action. If drink or drugs played a role in the occurrence, you can also be rejected. As always, prevention may be preferable to treatment.
Travel Insurance through Credit Card
Travel perks are promoted by credit cards as a means to provide value in exchange for annual fees. Here, we will contrast the Chase Sapphire Preferred® Card, Chase Sapphire Reserve®, and The Platinum Card® from American Express—three well-known credit cards that include travel insurance.
To be qualified for coverage with any of these cards, your trip transportation (such as a flight ticket, cruise, package tour, or rail ticket) must be paid for using their credit card. Additionally, you must still be a cardholder and have a valid account when you submit your claim. In the event that you used your card to pay for their travel, immediate family members are protected. Watch out for the child age restrictions, as they differ not just by card but also by benefit. All benefits apply to children under the age of 18, however some advantages also apply to older adult children who are enrolled in school.
Travel insurance through Chase Sapphire Preferred
One uncommon credit card that provides trip insurance without a prohibitively high annual charge is the Chase Sapphire Preferred® Card. For just $95 a year in annual fees, this mid-range card offers a number of outstanding benefits.
The card’s Auto Rental Collision Damage Waiver feature is among its most powerful advantages (CDW). If you rent a car, use your Sapphire Preferred card to pay and opt out of the CDW insurance offered by the rental company to be automatically protected. This insurance is primary, so it will cover payments for theft or unintentional damage before your home auto insurance kicks in. Keep in mind that it excludes liability for damages to other property (such a second automobile in a crash), medical costs, or attorney fees.
Trip Cancellation and Trip Interruption Insurance is an additional worthwhile advantage that is covered. If you have to unexpectedly cancel or shorten your trip (Trip Cancellation), this coverage reimburses you for nonrefundable, pre-paid expenses you spend (Trip Interruption). Up to $5,000 per traveler, up to $10,000 per trip, and up to $20,000 annually, can be reimbursed. The hospitalization or death of a close relative, court subpoenas, or terrorist activities are a few examples of covered reasons.
Accidental Death & Dismemberment insurance is the final significant coverage that is offered by this card. If you suffer a loss of sight, hearing, speech, a limb, or life while traveling, this insurance will pay a flat payment. However, it solely addresses unintentional demise from a fall or car accident. Unless the loss occurs while using a common carrier (for instance, while in flight), in which case the coverage increases to $500,000, the maximum amount of coverage is $100,000.
For lesser sums, The Sapphire Preferred also provides a number of insurance options. Although the maximum payout for these benefits ranges from $500 to $3,000, they cover often occurring occurrences, so you could find them useful.
At some point or another, all travelers have encountered travel delays, such as when a flight is canceled or a connection is missed due to a rainstorm. If you are delayed for a covered reason for more than 12 hours or overnight, the Chase Sapphire Preferred allows you to get a reimbursement of up to $500. (most commonly severe weather or mechanical issues). It will pay for expenses like hotel rooms, cabs, and meals.
Additionally, the card gives up to $3,000 in insurance per traveler for lost luggage or $500 for delayed luggage so you may make purchases while you wait for your luggage to arrive.
Insurance for Chase Sapphire Reserve travelers
A more expensive variant of the Sapphire Preferred is the Chase Sapphire Reserve®. You are spending significantly more with an annual charge of $550, but in return, you will gain access to more advantages. Some perks, such lost luggage and delayed baggage compensation, rental car CDW insurance, and other benefits are the same.
You’ll receive twice as much in potential reimbursement for Trip Interruption and Trip Cancellation (up to $10,000 per person, $20,000 per trip, and $40,000 annually), while other benefits give the same coverage but with greater maximum caps. Additionally, travel accident insurance doubles, with a potential $1 million compensation for a fatality while using a shared carrier. The trip delay reimbursement is still $500, but it now begins to work after six instead of twelve hours, making it far more practical.
The Sapphire Reserve also includes a few more types of travel insurance on top of those advantages.
The card may pay up to $100,000 for transportation, medical services, and required medical supplies if you or a family member need emergency evacuation while you are abroad. If you need an air ambulance and/or are going through a remote area, this might not always cover the full cost of your evacuation.
The only credit card on this list that also provides emergency medical and dental insurance is the Sapphire Reserve. However, the maximum compensation is $2,500. Although a lot of medical procedures will be covered by that sum, hospital costs in other nations may easily be more.
Travel Insurance for American Express Platinum Card
Another ultra-premium card with a $695 annual charge (Terms Apply) is the Platinum Card® from American Express. Several types of travel insurance are available; prices & fees.
Travelers are covered with up to $500 for unforeseen costs related with delays of six hours or more for common occurrences.
¹ Additionally, it offers a $3,000 reimbursement for missing bags. ² This coverage is comparable to that of the Sapphire Reserve, a rival product. The amount of the trip interruption and trip cancellation insurance is the same as that of the Sapphire Preferred: $10,000 for each trip and $20,000 annually. ³
The Platinum card does not include medical or dental coverage, in contrast to the Sapphire Reserve. However, it does offer emergency evacuation. The expense of the evacuation will be fully covered, but their Premium Global Assist Hotline chooses what constitutes acceptable medical care. ⁴ They will choose which hospital you are evacuated to as well as how and when you are removed. You’re in charge of paying all medical expenses once you’ve reached the place of their choosing.
Even though we’re only talking about the Platinum card in this article, it’s important to be aware that other premium Amex cards also provide travel insurance. If you have a card like the Hilton Honors Aspire Card from American Express*, Marriott Bonvoy Brilliant® American Express® Card, or Delta SkyMiles® Reserve American Express Card, check your benefits handbook for further information.
The amount of eligibility and benefits vary by card. Conditions, Restrictions, and Terms Apply. For further information, please visit americanexpress.com/benefitsguide. New Hampshire Insurance Company, an AIG company, is in charge of underwriting. Rules Apply.
To sum up
Credit cards provide genuine, material benefits for travel insurance that can guard you against unforeseen costs. There isn’t a single credit card that offers comprehensive travel insurance, though. The Sapphire Reserve comes the closest, but many travelers will prefer a more comprehensive policy because of its low cap on medical payments.
If your regular health insurance will cover any potential medical costs while traveling, credit card insurance will frequently be sufficient for short vacations. If a traveler wants comprehensive medical and/or evacuation insurance, they will need to get a different policy or be ready to cover any potential costs out of cash.