Travel insurance protects you from unexpected costs when travelling—whether within Canada or abroad. Medical emergencies abroad can cost tens of thousands of dollars, and trip cancellations can destroy your vacation investment. This guide explains the types of travel insurance available and how to choose appropriate coverage.
Table of contents
Why travel insurance matters
Types of travel insurance
Medical emergency coverage
Trip cancellation and interruption
Baggage and personal effects
Other coverage types
Factors affecting your premium
Common exclusions
Tips for buying travel insurance
Why travel insurance matters
Travel involves financial risks that most people don't consider until something goes wrong.
Medical emergencies abroad:
Healthcare in other countries can be extremely expensive. A simple emergency room visit in the United States can cost thousands of dollars. A hospital stay can cost tens of thousands. Without travel insurance, you'd pay these costs out of pocket. Your provincial health coverage provides limited or no coverage outside Canada.
Trip cancellations:
Life happens—illness, family emergencies, or other events can force you to cancel your trip. Without insurance, you'd lose your entire vacation investment. Most travel insurance covers cancellation for covered reasons.
Travel delays and interruptions:
Flight cancellations, missed connections, or other delays can strand you and cost money. Travel insurance can cover additional accommodation, meals, and transportation costs.
Lost or delayed baggage:
Baggage can be lost or delayed, leaving you without essential items. Travel insurance covers the cost of replacing belongings and paying for necessities.
Peace of mind:
Travel insurance lets you enjoy your trip knowing you're protected. This peace of mind is valuable, especially when travelling to unfamiliar places.
Types of travel insurance
Travel insurance comes in several forms, each designed for specific needs.
Single-trip insurance:
Covers one specific trip. Ideal if you travel occasionally. You buy coverage for the dates of your specific trip.
Multi-trip or annual insurance:
Covers multiple trips within a year. Ideal if you travel frequently—often two or more trips per year. Annual policies often provide better value for frequent travellers.
Travel medical insurance:
Focuses on medical emergencies while travelling. Usually the most important type of coverage. Available as stand-alone coverage or included in comprehensive policies.
Trip cancellation/interruption insurance:
Covers costs if you need to cancel or interrupt your trip. Often combined with travel medical coverage but can be purchased separately.
All-inclusive or comprehensive insurance:
Combines medical, cancellation, baggage, and other coverages into one policy. Usually the best value if you need multiple types of coverage.
Credit card travel insurance:
Many credit cards include some travel insurance. However, coverage is often limited and may not be adequate. Understand what's included before relying on it.
Medical emergency coverage
Medical coverage is the most critical component of travel insurance.
What medical coverage includes:
Emergency medical treatment, hospital stays, surgery, diagnostic tests, prescription medications, and ambulance transport. Some policies include repatriation—transport back to Canada if necessary. Coverage often includes 24-hour assistance services.
Coverage limits:
Policies have maximum benefit limits—typically $1 million to $5 million for emergency medical coverage. Higher limits cost more but provide more protection. Consider your destination—healthcare costs vary by country.
Pre-existing conditions:
Most policies exclude pre-existing conditions unless you meet specific requirements. Some policies cover stable pre-existing conditions. This is a critical consideration if you have health issues.
Stability requirements:
To cover pre-existing conditions, policies often require that the condition be stable—no changes in medication, no new symptoms, no hospitalizations—for a period before travel, typically 90 to 180 days.
Deductibles:
Policies may have deductibles—a fixed amount you pay before insurance kicks in. Higher deductibles mean lower premiums. Consider your ability to pay out-of-pocket when choosing a deductible.
Emergency assistance services:
Most policies include 24/7 emergency assistance. This service helps you find appropriate medical care, arrange hospital admission, coordinate with your insurer, and help with translation and communication.
Trip cancellation and interruption
This coverage protects your vacation investment.
Trip cancellation coverage:
Covers non-refundable trip costs if you need to cancel for covered reasons. Covered reasons typically include illness, injury, death of you or a family member, job loss, and other specified events.
Trip interruption coverage:
Covers costs if your trip is interrupted for covered reasons. Can include additional transportation costs to return home, unused prepaid expenses, and extra accommodation costs.
Covered reasons for cancellation:
Common covered reasons include your illness or injury, a family member's illness or death, job loss, severe weather, and travel advisories. Each policy specifies exactly what's covered—read carefully.
Covered reasons vary:
Not all reasons for cancellation are covered. Common exclusions include change of mind, routine cancellations, and issues with travel suppliers. Some policies allow "any reason" cancellation for additional premium.
Benefits and limits:
Cancellation coverage has benefit limits—typically covering 100% of trip cost up to a maximum. Interruption coverage often has separate limits. Understand what each covers.
Claim requirements:
To claim cancellation benefits, you typically need documentation—medical certificates, proof of death, proof of employment, etc. Understand what's required before you need to claim.
Baggage and personal effects
Protecting your belongings is another important coverage component.
Coverage for baggage:
Covers loss, theft, or damage to your luggage and personal belongings. Covers checked baggage, carry-on bags, and personal items.
Coverage limits:
Policies have specific limits for different types of items. Electronics, jewellery, and valuable items may have sub-limits. You may need additional coverage for high-value items.
Baggage delay coverage:
Covers essential purchases if your baggage is delayed—clothing, toiletries, and other necessities. Usually has a time delay before benefits begin.
Claim requirements:
To claim for lost or damaged baggage, you typically need to file a report with the airline or police, keep receipts for items purchased, and provide documentation of the loss.
Category limits:
Different categories of items may have different limits. Clothing may have one limit, electronics another, jewellery another. Understand the limits before you travel with valuable items.
Coverage exclusions:
Policies typically exclude certain items—cash, valuable documents, sports equipment used, and items shipped separately. Read exclusions carefully.
Other coverage types
Travel insurance can include additional coverage types.
Flight accident coverage:
Provides benefits if you die or are injured in an accident during your flight. Usually provides specified death benefits.
Travel accident coverage:
Similar to flight accident but covers accidents during your entire trip, not just flights.
Rental car coverage:
Covers damage to rental vehicles. Often duplicates coverage from your auto insurer or credit card—check before buying.
Adventure sports coverage:
Standard policies often exclude adventure activities—scuba diving, skiing, snowboarding, etc. Adventure sports coverage adds protection for these activities.
Cruise coverage:
Specialized coverage for cruise passengers. Covers missed port departures, cruise interruption, and other cruise-specific issues.
Destination wedding coverage:
Specialized coverage for wedding travel. Covers cancellation if the wedding is cancelled, and other wedding-specific issues.
Factors affecting your premium
Your premium depends on several factors.
Age:
Older travellers pay more for coverage. Premiums increase significantly after age 50 or 60. Some insurers stop offering coverage at certain ages.
Destination:
Where you're travelling affects your premium. Travel to the United States costs more than travel to Europe or Canada. High-cost healthcare destinations increase premiums.
Trip length:
Longer trips cost more to insure. Multi-day trips have higher premiums than short weekend trips.
Coverage amount and type:
More coverage costs more. Comprehensive policies cost more than basic travel medical coverage. Higher benefit limits mean higher premiums.
Pre-existing conditions:
Coverage for pre-existing conditions increases your premium. Declining this coverage reduces your cost but leaves you without protection for your conditions.
Deductible amount:
Higher deductibles reduce your premium. Choose a deductible you can afford to pay if you need to claim.
Number of travellers:
Covering multiple people increases your premium. Family policies may offer discounts compared to individual policies.
Common exclusions
Understanding exclusions helps you know what's not covered.
Pre-existing conditions:
The most common exclusion. Unless specifically covered, pre-existing conditions aren't covered. Even when covered, conditions must meet stability requirements.
Risky activities:
Many activities are excluded—skydiving, bungee jumping, rock climbing, and other adventure activities. Adventure sports coverage adds these back.
War and civil unrest:
Deaths or injuries from war, civil unrest, or terrorism may be excluded. Some policies include these for additional premium.
Self-inflicted injury:
Suicide or self-inflicted injuries are typically excluded.
Illness from alcohol or drugs:
Medical conditions related to substance use are often excluded.
Travelling against medical advice:
If you travel against your doctor's advice, related medical issues may be excluded.
Known events:
If you cancel a trip because of an event you knew about before buying insurance, it may not be covered.
Routine medical care:
Travel insurance is for emergencies, not routine care. Regular checkups, dental cleanings, and other routine care aren't covered.
Tips for buying travel insurance
Getting the right coverage requires some research.
Buy early: Buy travel insurance shortly after booking your trip. Some benefits require you to buy within a specific window after booking.
Read the policy: Understand what's covered and what's excluded. Don't assume anything is covered.
Compare options: Get quotes from multiple insurers. Coverage and pricing vary significantly.
Check existing coverage: Your credit card, employer, or existing policies may provide some coverage. Understand what's already covered before buying.
Consider your health: If you have health conditions, understand how they're covered. You may need to meet stability requirements.
Get adequate coverage: Don't skimp on coverage to save money. Medical emergencies abroad can be extremely expensive.
Keep documentation: Keep copies of your policy, receipts, and any documentation you'll need for claims.
Contact assistance services: If you need help while travelling, call your insurer's 24-hour assistance line first.
Travel insurance provides essential protection for Canadian travellers. Understanding your options and choosing appropriate coverage ensures you're protected against the financial risks of travel.