Travel without worries: Is travel insurance necessary?

BarcelonaIn 2023, Spanish insurance companies covered a health insurance claim costing €74,000 in Israel, €56,000 in Canada, and €48,000 in the United States, to name three. These are data from the insurance association Unespa for 2023, published last year. Because being a tourist has its risks, and as the saying goes: better safe than sorry. Unespa's data shows that taking out travel insurance isn't a bad idea, especially for some destinations.

Previously, trips were often purchased in packages, through travel agencies, and insurance was typically already included in the price. But now, when trips are typically planned and purchased online, this isn't the case. "We need digital platforms that make it easy to purchase a policy and, above all, to request assistance if there's a claim," explains María Prieto, marketing director of the travel insurance platform Heymondo, which last year processed travel insurance premiums worth nearly €40 million.

What should you insure when traveling? There are different answers. It depends on the destination. For example, healthcare is practically essential in some countries like the United States, Japan, or Thailand, not because it's bad in these destinations, but because it's very expensive. In other cases, such as Morocco, healthcare isn't that expensive, in principle, but if you want care that meets European standards, the bill can skyrocket.

In other countries, it may be more advantageous to insure repatriation or, depending on the level of insecurity, luggage. In fact, according to data from the employers' association Unespa, claims requiring repatriation, for example due to accident or illness, are few, accounting for 1.8% of the total, but the cost is high, averaging €1,205. In the most extreme case, which occurred in Iceland, returning a Spaniard cost €1,500.

Normally, insurance already covers several potential claims. But the level of coverage must be taken into account. In the United States, health insurance coverage of one million dollars is advisable, explains Prieto, who also clarifies that when traveling in Europe, it is believed that the European Health Insurance Card is sufficient, but it must be kept in mind that coverage is not the same everywhere, but is provided by the Social Security of each country.

Figures from the employers' association show that medical care (illness or hospitalization) tops the list of travel claims handled by insurers: 57.7%. Accidents are the second most common cause (12.3%), trip cancellation is the third (6.8%), and other causes, such as trip delay, cancellation, repatriation, or early return, are also less common.

Having insurance can save tourists from a significant financial setback. According to Unespa, the average cost of a transfer was almost €1,600, and repatriation cost an average of €1,205. In fact, the average cost of claims covered by insurers for travelers was €434, an amount higher than the premium paid for the insurance. In fact, the cost of the policy varies depending on the coverage, but good travel insurance can cost between €2 and €4 per day, and depending on where you're traveling, it's a small cost compared to the prices of flights or accommodation.

Almost 80% of travelers hire it

In fact, travel insurance is becoming a must for tourists. Heymondo conducted a study indicating that 78% of travelers outside the European Union purchase this type of insurance. And although it may seem like a product aimed more at older people, who are generally more fearful of the unexpected and more conservative, the fact is that a growing focus on destination security has been detected as a reason for purchasing it among the 25-34 age group (young travelers). "This is probably because young people travel to places that we might describe as less safe," Prieto indicates.

The study explains what tourists value most in their insurance: 24-hour assistance (48%), good value for money (47%), transparency (37%), flexibility (36%), and trust in the insurance company (36%). The study also records why travelers don't purchase insurance: they think it's not necessary for their destination (34%), they don't see good value for money (31%), they lack trust in insurers (17%), and they lack transparency (13%).