How to Calculate Trip Cost Correctly for Your Travel Insurance Quote

TLDR: When calculating trip cost in order to get the most accurate travel protection quote price, focus on prepaid, non-refundable travel expenses. Try our Trip Cost Calculator.

Here’s something you rarely hear from an insurance company: You could be buying more travel insurance than you need.

Okay, full disclosure: You might be buying less travel insurance than you need, too. The point is that you should only cover the insurable expenses associated with your trip. To do that you need to understand what trip costs travel insurance actually covers, before you buy a plan.

Why is trip cost important?

There are a number of factors that go into crafting a custom travel insurance quote for your trip, and one of those is trip cost. It’s the last thing we ask for in the quote form and is one of the most important factors for determining the price of the plan.

Trip cost matters so much because two important benefits in our plans, Trip Cancellation and Trip Interruption, cover a percentage of your trip cost.

For example, if you have a Premium plan and need to cancel your trip for a covered reason you could be reimbursed up to 100% of your insured trip cost. If your trip is interrupted for a covered reason, it’s even better – up to 175% of your trip cost could be reimbursed, which is helpful in case there are extra costs getting you back on your trip or back home.

Other benefits, like Baggage or Medical and Dental, cover only up to a set dollar amount, which is not connected to the trip cost.

Entering an accurate trip cost is especially important if you are interested in adding Trip Cancellation for Any Reason coverage to our Premium plan. To qualify for the coverage, you must insure 100% of all arrangements that are subject to cancellation penalties or restrictions. The same requirement applies if you want to take advantage of coverage for Pre-existing Medical Conditions under our Premium plan.

What trip costs can travel insurance cover?

The travel insurance coverages that are dependent on trip cost can reimburse you for things you’ve already paid for. It won’t pay for things you plan to spend money on but haven’t yet, or situations where there are other ways for you to get your money back.

Here’s a breakdown of common trip costs and whether they can be covered by travel insurance. If it’s in the “not covered” list, don’t include it in your trip cost calculation.

 Can Be Covered  Not Covered

 Non-refundable (or the non-refundable portion of):

 Any refundable prepaid expenses (plane tickets, hotels, tour costs, etc.)

 Plane tickets


 Cruise bookings




 Tour costs

 Spur-of-the-moment transportation (like cabs and metros)


 A ball game you decide to go to

 Prepaid meals

 A food-stall lunch

 Rental car

 Travel points/rewards (except frequent flyer miles)

Refundable trip costs

Pay close attention to the first item on the “Not covered” list. If you’ve already paid for a plane ticket or hotel room, and it’s fully refundable, insurance will not cover that cost. The hotel or airline is responsible for the refund.

In addition, if a prepaid expense is partially refundable, insurance will only cover the difference between what you paid and what you were refunded.

For instance, if the cruise line refunded you $5,000 on a $7,500 river cruise, insurance can cover the $2,500 difference.

Explore refund policies for airlines

Adding up trip costs

Here’s what you do with this information.

Before you take a trip, add up how much you’ve already paid for each of the things in the first column. Include trip costs for all travelers that are covered by the travel protection plan. You can use our Trip Cost Calculator to help determine the accurate trip cost for travel insurance.

Whatever that number is, you should enter it as the total trip cost when getting a travel prtection quote – not a higher number that might include refundable or non-prepaid expenses.

To be as accurate as possible, you may need to dive into the refund policies of your travel providers. It’s not the most exciting part of taking a trip, but it can be enlightening, and it could save you money on travel insurance.

(Note: Travel providers often have date parameters around their refund policies – 75% back if you cancel 90 days or more prior to your trip, 25% if you cancel between 30 and 90 days, and so forth. If that’s the case, use the refund amount that applies to the date you buy the travel insurance, or the smallest refund amount for your calculations.)

Get travel insurance at the right price

When calculating trip cost in order to get the most accurate travel protection quote price, focus on prepaid, non-refundable travel expenses.

You might be surprised on how low that number ends up, and the value a travel protection plan can have when you cover only the expenses that need to be covered.

You can start that process right now by getting an instant quote customized for your vacation.


Know your trip cost? Now get travel protection
Average Customer Rating: