How Does Travel Insurance Work and Do I Need it?

Researching travel insurance probably isn’t the most exciting part about your upcoming trip so we’ve put together a full article of all of the travel fails we’ve had along the way when we were damn happy to have travel insurance! If this is all very new to you we recommend you watch the video first to learn a little bit about how travel insurance works - then continue to the rest of the article.

Hindsight is 20/20. After 8 months on our RTW trip, I can safely say, I'm damn happy that we paid to get travel insurance. While it turned out that we spent more money for insurance than we got out of it benefit wise (barely), even just having the policy in place gave us peace of mind that if something serious happened we had cover for key unexpected situations we knew we could not afford to cover ourselves.

About this Insurance Review

This travel insurance review will lay out our personal experience with World Nomads over the course of our year trip. This article may come off sounding a bit like an advertisement. To be transparent, we are now an affiliate partner with World Nomads based on our experience with their service. This, however, is not a sponsored post and the only reason we chose World Nomads in the first place is just because it was the cheapest option (and we were on a budget!)

As with any product we feature on our site, if it's good, we tell you so. If a service is hot garbage, we'll destroy it faster than a Thai snorkel tour can wreck a reef. We had an overwhelming positive experience with travel insurance through World Nomads. However, I want to be completely transparent on our experience-both the good and the bad. Plus, we should tell you upfront that the policy we bought from World Nomads was for US residents and everything in this article relates to our personal experience.

We understand that the cover available for plans from World Nomads depends on your country of residence, when you buy your policy, any options or upgrades you buy and finally your own personal circumstances and what happens to you on the road. We can’t guarantee that you’ll have the same cover, so you should read your policy cover carefully before you assume your World Nomads policy will work the same way ours did.

How much does travel insurance cost?

Travel insurance costs vary depending on your country of residence, length of travel and other variables but you can use this tool to estimate what your trip would cost.

Before we left we paid $1,976.00 for travel insurance through World Nomads. The plan we chose was the Explorer insurance policy for US residents to cover us from September to May.  Keep in mind that prices can and do change, and will vary depending on your country of residence, length of travel, etc. For our policy, to be covered for exactly 9 full months, it turned out to be slightly over $7.33/day for both Fin and I.

Now what is it exactly that $7.33 a day bought us?

Baggage and Personal Effects Coverage

One consistent thing we heard from many travelers both online and in person, is that almost anyone who had traveled claimed to have been pick-pocketed or had something stolen. Since we're overloaded with gadgets, cameras, and tech, I wanted to buy the peace of mind knowing that if someone pulled an Oceans 11 on us, I wouldn't end up crying in my cereal.

When we left we purchased the Explorer Plan for US residents from World Nomads. The Explorer Plan for US residents offered an increased Personal Effects coverage of $3,000.00 -That's the coverage per person by the way.

If you don't think you'll have $3,000 worth of goods on you while you travel I urge you to sit down and actually make a list. You'll be surprised how much the clothes you have on, the clothes in your backpack, and the backpack itself are worth. By the time you add in a smartphone or a camera you'll be closer to $3,000.00 than you probably thought you were.

One caveat- the baggage coverage we bought has a $1,500 per article limit. That meant that our shiny new drone was potentially covered if it got swiped. However, if you're bringing a brand new $2,500 laptop with you may only be able to recover $1,500.00 if it were to get stolen. Lost is too broad and not always covered, depending on the circumstances.

Even so, the peace of mind that we had coverage in place is well worth the price tag of the insurance.

OUR EXPERIENCE:

Luckily, we made it through 20 countries with zero theft. The only items we lost were a pair of sunglasses left behind at a hotel. Obviously, I wasn't going to be making a claim on a scratched up pair of shades that I was at fault for leaving behind. Coverage on our personal effects was the primary reason we took out a policy in the first place though.

Baggage Delay

Although our Chase Sapphire card would have covered us up to $100 for baggage delay, travel insurance from World Nomads covered us as US residents up to $150 a day with $750 total coverage. Your bag only needs to be delayed 12 hours before you can start collecting on this.

OUR EXPERIENCE:

We were in dire need of this coverage when we arrived in Christchurch, New Zealand after flying in from Bali. New Zealand was a bit on the chilly side and I didn’t follow any of my own travel advice for flying- I didn't wear long pants, I didn't wear shoes, and I didn't bring my toiletries as carry on. Don't judge- Anyone is just a red eye and a lost bag away from looking like a filthy peasant.

That left a shoe-less, shivering, hygienically challenged man standing at the airport in Christchurch. As you well know, clothing can be quite expensive in New Zealand, so I was happy to be able to replace key essential items to help out in this jam. A bag delayed by one day can be annoying. My bag was delayed for just under four days. That meant I was out camping in a van with only what I purchased after touching down.

If I didn't have insurance I would have been either

  1. really uncomfortable or

  2. really broke.

Having insurance made a bad situation much easier to live with.

Collision Damage Waiver (Car Insurance)

The policy we bought with World Nomads included a Collision Damage Waiver that covers in the event that your rental car is damaged due to collision, theft, vandalism, windstorm, fire, hail, flood or any cause not within your control while it's in your possession. Our policy covered us up to a very healthy $35,000.00

Why does this coverage rule? Easy- you can wave insurance coverage on rental cars and save money while you're actually traveling. Not all travel insurance plans work this way this though – so make sure you check out your policy carefully first before you waive the car rental cover. In addition, there are many vehicle types that are excluded from coverage. We are actually still working our way through a claim because of damage to our Wicked Campers.

HOW THIS SAVED OUR BUTTS:

While parked at the Divide parking lot for the Key Summit hike someone clipped the side of our car. It left a sizable dent and broken taillight. We wound up being completely reimbursed by World Nomads once Wicked Campers charged us for the damage after returning the car.

Even if I was blind I would know this is horribly damaged, by the way it feels. ( Sorry-I still think Dane Cook is funny)

What if you get sick on your trip?

One Bahn Mi and a bout of Giardia, please.

One Bahn Mi and a bout of Giardia, please.

Emergency Accident and Sickness Medical Expense

Not just “I feel ooogy this morning” sick. I mean “it’s coming out of both ends and hasn’t stopped for 3 days” sick. Not something that would happen when you're at home and know how to take care of yourself. When you're overseas, you're going to be a lot less prepared should you fall ill and need medical attention.

Finding a hospital or doctor, bridging the language gap...there are going to be a lot of more pressing issues than how you're going to pay for your treatment. That being said, you'll also be surprised how cheap it is to treat yourself while overseas. This is especially true in South East Asia.

Antibiotics, steroids (not the Arnold kind), birth control, etc are all available over the counter. So if you have strep throat, it’s possible you can take care of yourself without ever visiting a doctor.

(Disclaimer: we are not medical professionals and are not suggesting medical advice in this article)

Something that many people aren't aware of is that your health insurance from home may not cover you while abroad. Coverage varies from provider to provider and by policy, but it's difficult to find a health care policy in the United States that will cover you while on your trip for a competitive price.

HOW THIS SAVED OUR BUTTS:

After two red eye flights and a missing bag, I woke up in a campervan in New Zealand with half of my face swollen up. Nothing like this has happened to me in 33 years of my life. Of course it would happen to me in a place where I didn't know how to find a doctor, let alone do it on the cheap. I did end up finding the town clinic after visiting two different hospitals that kindly sent me away. Another exotic, foreign local that begs to be posted to Instagram.After the wonderful Pleasant Point Medical Centre took care of me I only got hit with a $75 NZD bill.

Keep in mind that this insurance policy does not cover you for any previously existing conditions or for any non-urgent treatment which can wait until your return home. Basically, you're not going to be able to see a dermatologist while you're abroad for a small pimple right before prom and expect your insurer to pay the bill. Why are you going to prom in Bangkok anyway?

Extreme Sports and the Explorer Plan

You’d be surprised what is considered “extreme” to an insurance company…

You’d be surprised what is considered “extreme” to an insurance company…

Our upgraded travel insurance with the Explorer Plan also offered us coverage on a long list of adventure activities. It's worth noting that the Standard Plan for US residents through World Nomads excluded these extreme sports listed below:

If you tried, you could do everything on this list during a busy day in Queenstown, New Zealand. We chose the Explorer Plan for that reason but that might not be right for you.

HOW THIS SAVED OUR BUTTS

I could tell Fin I was covered anytime I jumped off a cliff! Cliff jumping is one activity which is only covered in the US plans, Which happens more often than you would think. "Tim, if your friends all jumped off a ....never mind".

Not all World Nomads plans cover cliff jumping- check out the full list of activities included.

Emergency Evacuation and Repatriation

Under the Explorer Plan there’s cover (up to $500,000) for emergency transportation to the nearest, most suitable medical facility. Additionally, it provides transfer between hospitals if medically required. Finally, it gives assistance to repatriate you home to the United States. This is provided your condition be so serious you’re unable to keep travelling. To qualify for this, a physician must certify that your injury or illness is severe enough to require emergency evacuation.

You should also contact World Nomads’ insurer immediately. They will help to arrange your evacuation or repatriation and to handle all medical costs if you’re hospitalized.

THIS SAVED OUR BUTTS WHEN:

We never had to use this part of our policy- but disaster struck while we were in Bali for another American that didn't have the proper insurance in place. Ryan Boerman of San Diego was bitten by a shark just two hours north of where we were staying. It turned out that Ryan's policy would not cover the cost of international medical transport to Singapore. On the plus side, he wins every Most Badass Story contest for the rest of his life.

Ryan’s story ended well. He was able to raise money through GoFundMe to cover his flight. Eventually, he ended up making it to the hospital in Singapore. As far as I know, his hand healed completely.  He now has a killer story to tell girls at the bar. Additionally, he is now a valid candidate for Most Interesting Man in the World.

What's he last thing you want to deal with after a shark nearly rips your arm off? Hunting through fine print on your travel insurance policy. Make sure you have coverage beforehand.

Check out this story here- World Nomads covered a shark attack in Bali for an UK resident.

Other Benefits on the Explorer Plan for US residents

  • Trip Cancellation

  • Trip Delay

  • Accidental Death and Dismembermant

  • One Call 24 Hour Assistance Services

  • Trip Interruption

  • One Call Non-Medical Emergency Evacuation Services

We didn’t know how our ears would do during our PADI Open Water Course, but happy we we were covered.

We didn’t know how our ears would do during our PADI Open Water Course, but happy we we were covered.

Pros and Cons of Travel Insurance

Pros:

  • Peace of Mind

  • Our gear was covered for theft up to $3,000 per person; $1,500 per article

  • World Nomads - the lowest price provider of the three I received quotes from.

  • Claims Process

  • Relatively easy online portal. Easy to check status on a claim and quick turn around.

Cons

  • Poor Phone Support from On Call – the assistance company for US plans from World Nomads (Fin got very bad strep throat while in Hanoi, Vietnam. She started to feel really sick at about 2AM. This left me calling phone support to help us find a hospital in the middle of the night. What I ended up with was an email asking a bunch of questions not irrelevant to the situation.  Additionally, I was told that On Call couldn't provide support until I answered the questions. Additionally, when they finally provided a hospital suggestions it was for hospitals that were not open for emergency 24 hours.

  • Based upon the terrible service On Call provided, I wouldn't bother ever trying to use it again.  It was truly just a waste of my time.

  • Claims Process (Yes, it can be a negative too. In the case of the medical claim from my doctor visit for a swollen face, the insurer needed the medical documentation for my $75 NZD expenses. Even after turning in the receipt for my payment to the medical centre, World Nomads requested further documentation but could not be specific in what the medical document would be called, just that it should detail exactly what service the centre provided for me. I had held on to every receipt and piece of paper the centre provided me with. After a quick online chat with my representative they waived the document requirement.  They were asking for a nameless undefined form!  After our conversation they quickly issued a check.

Travel Insurance Review Verdict

After the experience we had during our first trip around the world we continue to use World Nomads for every next adventure. The peace of mind knowing that our possessions would be covered if stolen was reason enough. More importantly, I know that Fin and I were covered for medical costs during our trip.

Going to a hospital or a doctor abroad would always be confusing.  With insurance the stress of finding out what the bill was going to be was drastically lowered. After our experience, I trust World Nomads insurance and would be happy to answer any questions you might have about our experience (of course if you have questions about coverage you’ll need to reach out to World Nomads directly).

We know shopping around for travel insurance is likely not the most exciting part of your trip, but hopefully hearing all of our travel fails helps put in to perspective how much we loved having coverage.

See how much your trip would cost with World Nomads

SUPER LEGAL DISCLAIMER

Keep in mind, everything I’ve said here about travel insurance is a brief, general summary correct as of the date of publication. It doesn't take into account your personal situation, what you want or might need. Before you buy, it's important to consider what insurance product is right for you. Carefully read all policy documents to understand what's covered and not covered. Additionally, take time to understand the limits, terms and conditions which may apply.