Travel insurance is an essential investment for anyone planning a trip, offering financial protection against unexpected events such as medical emergencies, trip cancellations, and lost luggage. As we approach 2025, it’s crucial to understand how much travel insurance costs and what factors influence its price. This article will explore the average costs, key determinants, and tips for finding the best coverage.
Key Takeaways on Travel Insurance Costs
Comprehensive travel insurance plans typically cost between 4% and 10% of your prepaid, non-refundable trip costs. According to data from Squaremouth, the average cost of travel insurance is $311 per policy, with an average trip length of 15 days. This means travelers spend an average of $21 per day on travel insurance, though lower-cost plans are also available.
The amount you spend on travel insurance depends on several factors, including your age, travel expenses, trip length, coverage needs, and other risk factors. To get exact pricing for your trip, consider using a quote tool to compare different options.
What is the Average Cost of Travel Insurance in 2025?
Internal sales data from Squaremouth reveals that the average cost of travel insurance is roughly $21 per day. The average premium in 2025 for Squaremouth visitors is $311, with an average trip length of 15 days. This represents a slight increase from 2024, where premiums averaged $308, due in large part to an increase in traveler spending.
A recent Squaremouth survey found that over 50% of travelers anticipate spending more on trips this year. Trip cost is one of the biggest determining factors when calculating the cost of travel insurance. Many other factors contribute to rising travel insurance prices, so it’s important to understand how your trip details may impact the premiums you receive when getting quotes.
What is a Good Rate for Travel Insurance?
A good rate for comprehensive travel insurance typically falls between 4% and 10% of the total prepaid, non-refundable trip costs you choose to protect. Here are a few examples to help put those percentages into perspective:
- For a $10,000 insured trip, a comprehensive travel insurance plan will typically cost between $400 and $1,000.
- For a $3,000 trip, a good price for comprehensive coverage would be between $120 and $300.
Travel medical insurance plans are more affordable since they do not cover travel expenses. The cost of travel medical policies is instead largely dependent on your age, trip length, and the amount of coverage you purchase.
Below are a few ranges of travel medical insurance policies for specific situations:
- For a 7-day international trip for two 30-year-olds, travel medical plans range from $10 to $50 for basic coverage.
- For a 14-day trip without trip cancellation coverage for a family of four, a medical-only plan may cost between $25 and $125.
Factors That Determine the Cost of Travel Insurance
Travel insurance premiums are primarily determined by five key factors: your total trip cost, the age of each traveler, the length of your trip, your coverage requirements, and the type of policy you choose. Additional details like your travel destination, add-ons you choose to purchase, and even your state of residence can also influence your premium.
Here’s a breakdown of how each factor will play a role in determining the cost of travel insurance for your upcoming adventure:
Total Trip Cost
Comprehensive travel insurance plans are designed to reimburse your travel expenses in the event your trip is unexpectedly cancelled or cut short. Trips with high amounts of prepaid, non-refundable travel expenses are typically more expensive to insure.
Traveler Ages
Older travelers usually pay higher premiums due to increased health and medical risk. The number of travelers in your party that you are protecting will also impact how much you spend on travel insurance.
Length of Travel
Providers will use your departure and return dates to determine your coverage period. Longer trips tend to cost more to insure because they carry a higher chance of travel disruptions.
Coverage Amounts
Policies with higher coverage limits, especially for medical benefits, come with higher premiums as they offer more robust financial protection.
Policy Type
Single-trip travel insurance is typically more affordable than annual travel insurance for infrequent travelers. But, annual plans can be cost-effective if you travel at least three times a year.
What is the Average Cost of Travel Insurance by Age?
Age is one of the top factors that affect the cost of travel insurance. The chart below shows a travel insurance price comparison broken down by generation.
Of all age groups, the cost of travel insurance for seniors is the highest due to increased health risks at these ages, greater spending on trips, and longer travel time.
Millennials typically pay the least for travel insurance, with an average cost of $178.92 per policy. However, this group also spends less on their trips, which contributes to paying a lower overall price for travel protection.
What is the Average Cost of Travel Insurance by Plan Type?
The type of coverage you choose also impacts how much you will spend on trip protection. The following chart highlights the price difference between the two main forms of travel insurance: Medical-Only and Comprehensive.
Medical-only travel insurance is the most affordable type of travel insurance you can buy. Over the past 12 months, Squaremouth users spent an average of $90.57 on medical travel insurance plans, or roughly $4.53 per day.
In contrast, comprehensive travel insurance plans are the most robust type of coverage you can purchase for a trip, which makes them more expensive than medical-only plans. Over the past year, Squaremouth users spent an average of $414.14 on comprehensive travel insurance, or roughly $29.57 per day.
What is the Average Cost of Travel Insurance by Destination?
Below is a list of the 10 most popular destinations for Squaremouth customers and the average cost of travel insurance policies by destination. These figures are based on Squaremouth sales data from the past 12 months.
Travelers to Mexico spend the least on travel insurance, while travelers to Italy spend the most. Interestingly, the Bahamas has the highest cost per day of any of the top travel destinations.
Optional Coverage That Will Increase Travel Insurance Costs
Many travel insurance policies give you the option to enhance your coverage through “add-ons” or policy upgrades. Since these are optional, they carry an additional cost. Popular add-ons include Cancel For Any Reason, Pre-Existing Condition, and Rental Car Damage.
Cancel For Any Reason
Cancel For Any Reason (CFAR) partially refunds your trip payments if you cancel for a reason not explicitly covered by your policy. This benefit is only available to eligible travelers who purchase their policy within the time-sensitive period, which is typically 10-21 days after their initial trip deposit.
Adding CFAR to your policy can increase premiums by about 40-50%. In 2025, the average CFAR policy sold through Squaremouth cost travelers $696.
Pre-Existing Condition
While not technically an add-on, Pre-Existing Condition coverage is a type of coverage that is automatically applied to eligible travelers at no additional cost. With that said, multiple eligibility restrictions must be met, which often vary by provider. In most cases, you will need to insure 100% of your trip costs and purchase a plan within the time-sensitive period.
Rental Car Damage
Coverage for Rental Car Damage is an optional add-on that many providers offer. This benefit can cover the cost of damage or theft of a rental vehicle during your trip. Rental Car Damage protection is not known to significantly increase premiums, but it is often less affordable and less robust than dedicated auto insurance policies.
Does A Higher Premium Mean Better Coverage?
No, high premiums do not always equate to better protection. When choosing between similar policies that meet your coverage needs, we always recommend opting for the less expensive plan.
Purchasing travel insurance through sites like Squaremouth allows you to see how plans from the best travel insurance companies compare when it comes to price and coverage.
Shopping around for travel insurance can also help you find more affordable protection compared to plans offered through airlines, cruise lines, hotels, and other travel suppliers.
Bottom Line: Is Travel Insurance Worth It?
Travel insurance can be a worthwhile investment if you’re concerned about potential issues with your trip. Even a basic, low-cost travel insurance policy can save you thousands in the event you encounter a medical emergency or other type of trip disruption while away from home.
According to Squaremouth data, travel insurance claims pay 6 times the average travel insurance policy premium, highlighting the potential value in purchasing protection before departing for your trip.
To get the best coverage, we recommend comparing travel insurance quotes from multiple providers, paying close attention to how different plans compete when it comes to cost and coverage.
