How does credit card travel insurance work? (2024)

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Even veteran travelers can be thrown off course by a delayed flight, lost luggage, illness or any number of other calamities.

If you didn't buy a travel insurance policy when you booked your plans, you could be out thousands of dollars in airfare, hotel reservations and more. But the best travel credit cards have built-in travel insurance that reimburses you for many unexpected expenses.

Here's what you need to know about credit card travel insurance, including how it works, what it covers and which cards are the best for travel insurance benefits.

In addition, most credit card travel insurance is secondary insurance: That means, for example, if your luggage is stolen, you'll have to file a claim with your homeowners insurance provider before your card company will pay out.

Trip cancellation and interruption

Trip cancellation and interruption protection help if your travels are canceled or cut short due to unforeseen circ*mstances, like a medical emergency or a death in the family. You may also be able to get reimbursed for expenses related to getting home, like a cab to the airport.

Read your card's policy to understand what is covered and how much you could be reimbursed.

Trip delay

Airlines aren't required to compensate passengers for a delayed flight — you might not even get a meal, depending on the cause. Trip delay insurance kicks in after a delay of a certain number of hours or if it necessitates an overnight stay. There's usually a per-day limit and a total maximum benefit per person.

Credit card trip delay coverage is secondary, which means if the airline gives you vouchers for food or a hotel, you can't file a claim with your card.

Delayed and lost baggage

Airlines are required to compensate passengers for lost luggage up to $3,800 per person for domestic flights and up to $1,700 for international flights.Many carriers exclude laptops, cameras and other valuables, however, and it's unlikely you'll be reimbursed the full value of your belongings.

Rental car

Travel medical and evacuation

Travel accident

The best travel credit cards offer travel insurance. For frequent travelers, this can be worth an annual fee, but choose a card that works best for you.

Chase Sapphire Reserve® Card

The Chase Sapphire Reserve card offers some of the most generous travel protections of any credit card, including up to $10,000 per person and $20,000 per trip for trip cancellation or interruption. It also comes with coverage for trip delays and lost/delayed baggage.

The card also carries up to $75,000 in rental car insurance and, unlike most cards, its primary insurance. That means you don't have to file a claim with your car insurance company and risk raising your premiums.

Southwest Rapid Rewards® Plus Credit Card

The Southwest Rapid Rewards Plus Credit Card comes with trip cancellation and trip delay protection, as well as a lost luggage benefit of up to $3,000 per passenger and baggage delay insurance worth up to $100 a day for three days if your bags are delayed for more than six hours.

Its $69 annual fee is one of the lowest for travel cards that offer travel accident insurance.

Chase Ink Business Preferred® Credit Card

The Ink Business Preferred credit card comes with trip cancellation and interruption insurance for prepaid, non-refundable travel expenses. Rental car insurance with Ink Business Preferred is primary if it's for business reasons or if you're renting outside a vehicle outside of the U.S.

Platinum Card® from American Express

Bank of America® Premium Rewards® credit card

Many travel credit cards have built-intravel protections that can help in many situations. However, there are substantial differences from getting a standalone travel insurance policy.

Cost

Your card's annual fee pays for travel insurance benefits, so there's no additional per-trip cost. A standalone travel insurance policy, on the other hand, typically costs between 4% and 8% of a trip's total value.

Coverage limits

Credit cards usually have much lower limits than standalone policies: Chase Sapphire Reserve caps payouts for travel cancellation at $10,000 per person, for example, while Allianz Travel's OneTrip Prime policy reimburses up to $100,000 per traveler.

Features

While a travel card can cover trip cancellations, delays and interruptions, a separate policy will almost always have more benefits and options for customized limits.

Many insurers offer acancel for any reason (CFAR) add-on, for example, which lets you cancel your trip for nearly any reason — even one not otherwise covered by your policy. They may also have awaiver for pre-existing medical conditions, which credit cards lack.

Pros

• No additional per-trip cost
• Coverage is automatic with purchase
• Other travel benefits, like bonus points, free bag check and lounge access.

Cons

• Trip must be booked using your credit card
• Coverage limits are much lower than with a standalone policy
• Rarely cover traveling companions except for immediate family members
• Most cards do not cover medical treatment or emergency evacuation

• Proof of trip delay, interruption or cancellation
• Receipts for any expenses relating to the claim (food, cab ride, hotel stay, etc.)
• Medical bills and hospital records
• Police reports
• A loss report from the airline or other transportation provider
• A list of what was in your luggage and its value

Here's how to file a claim with several major credit card carriers.

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Information about the Bank of America® Premium Rewards® credit card has been collected independently by CNBC Select and has not been reviewed or provided by the issuer of the card prior to publication.

*Eligibility and Benefit level varies by Card. Terms, conditions and limitations apply. Visit the American Express benefits guide for more details. Underwritten by New Hampshire Insurance Company, an AIG Company.

**Eligibility and Benefit level varies by Card. Terms, conditions and limitations apply. Visit the American Express benefits guide for more details. Underwritten by AMEX Assurance Company. Car Rental Loss or Damage Coverage is offered through American Express Travel Related Services Company, Inc.

*** Eligibility and Benefit level varies by Card. Terms, conditions and limitations apply. Visit the American Express benefits guide for more details. Please visit americanexpress.com/benefitsguide for more details. If approved and coordinated by Premium Global Assist Hotline, emergency medical transportation assistance may be provided at no cost. In any other circ*mstance, Card Members may be responsible for the costs charged by third-party service providers.