Travel insurance marketplace Squaremouth, which found that travelers are spending an average of nearly $10,000 on their trips this summer, has outlined the factors influencing travel insurance policy prices to shed light on how much goes towards protecting those costly vacations.
According to Squaremouth, a comprehensive travel insurance policy ranges from 5% to 10% of total trip expenses. Such a plan covers cancelations, medical emergencies, delays, baggage issues, among others. If travelers opt out of insuring the trip cost, the premium will be significantly lower, as the policy will exclude cancelation coverage.
This summer, the average cost of a comprehensive travel insurance policy on Squaremouth.com stands at $595. For those opting not to include cancelation coverage, the average cost drops to $93.
For context, here are the average trip costs and premiums per year from 2019, based on data analyzed by Squaremouth:
|
Year |
Average trip cost |
Average premium |
|---|---|---|
|
2024 |
$9,995 |
$629 |
|
2023 |
$9,333 |
$564 |
|
2022 |
$8,742 |
$528 |
|
2021 |
$7,366 |
$451 |
|
2020 |
$8,242 |
$493 |
|
2019 |
$8,459 |
$479 |
Squaremouth went on to note that travel insurance premiums vary based on several factors: the total cost of the trip, the traveler’s age, and the trip duration. Insurance buyers can choose to insure all, part, or none of their trip costs, including expenses like airfare, hotels, tours, and excursions.
Meanwhile insurance providers target different age demographics, adjusting premiums accordingly. Generally, older travelers face higher premiums, Squaremouth said. Also, coverage typically spans from when travelers leave home until they return. Therefore, longer trips result in higher premiums.
Additionally, many insurers offer optional upgrades that enhance coverage at a cost. Popular upgrades include ‘cancel for any reason’ and rental car coverage, which can raise the premium by approximately 40%.
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