Last updated: 4 November 2026. This guide contains affiliate links; if you book through one we may earn a commission at no extra cost to you. How we make money.
Short answer: travel insurance mostly pays out for one thing: medical treatment abroad. In the UK, the Association of British Insurers counted more than 500,000 travel claims worth £472 million in 2024, and medical expenses were the biggest single category at £262 million. Cancellation, lost bags and delays make up most of the rest. Claims that fail usually fail for dull, avoidable reasons: a health condition that was never declared, a policy bought after the problem was already known, a reason for cancelling that the policy never covered, or missing receipts. If you buy early, declare honestly, read the list of covered cancellation reasons and keep every piece of paper, your claim is very likely to be paid. This guide shows the numbers and the small print behind that.
In this guide
- What people actually claim for
- The four reasons claims get refused
- Medical cover: the part that matters most
- Cancellation: covered reasons and the ones that are not
- Baggage, delays and missed departures
- Where your hotel booking fits in
- A claim-proof checklist
- FAQ
What people actually claim for
Most people buy travel insurance thinking about cancelled flights and stolen phones. The money goes somewhere else. The two most recent UK datasets agree that medical claims dominate, both by number and by value.
| Measure | Figure | Source |
|---|---|---|
| Total travel claims paid, UK, 2024 | £472 million across more than 500,000 claims | ABI, August 2025 |
| Medical expenses, UK, 2024 | £262 million paid; average claim £1,528 | ABI |
| Medical share of all claims, UK | 34% in 2024, up from 29% in 2023 | ABI |
| Claim mix at one UK insurer, 2025 | Medical 43%, cancellation 16%, lost possessions 10%, travel delay 9%, cutting a trip short 4% | Multitrip.com, June 2026 |
| Most common medical claims, 2025 | Fractures 34%, internal illness 33%, burns, bites and soft-tissue injuries 10% | Multitrip.com |
| Average medical repatriation, US to UK | More than £192,000 (2024) | Multitrip.com |
| Average medical repatriation, Spain to UK | About £45,000 | Multitrip.com |
Read the table from the bottom up and the purpose of travel insurance becomes obvious. A lost suitcase is annoying. A broken leg in Florida followed by a stretcher flight home is a six-figure bill that would wipe out most households. The cancellation and baggage sections of a policy are useful extras; the medical and repatriation section is the reason to buy it at all.
Our view: choose a policy on its medical limit and its list of covered cancellation reasons first, and only then compare the baggage and gadget extras. A cheap policy with a low medical limit is a false economy for anyone going to the US, Canada or a cruise.
The four reasons claims get refused
Squaremouth, a US travel insurance comparison site, has published its list of the most common reasons claims are turned down. The same themes run through the UK Financial Ombudsman Service’s guidance, and none of them is a trick hidden in the small print. They are all things the traveller could have avoided.
1. You were not eligible when you bought it. If you were already ill, waiting for test results, or had a condition you did not declare, the insurer can refuse a claim linked to it. In the UK, the Financial Ombudsman Service says you should also tell your insurer about significant changes in your health after you buy, if the policy asks you to, even before you have a diagnosis. An urgent referral to a consultant counts. A cold that cleared up in a week should not.
There is some protection here. If you failed to declare something and the insurer would simply have charged you more, the Ombudsman generally thinks it is fair for the insurer to pay the claim minus the extra premium, rather than refuse it outright. That is not a reason to skip the medical questions. It is a reason to complain if an insurer refuses the whole claim over a small omission.
2. You bought it too late. Insurance covers the unexpected. Once a storm has a name, a strike has been announced or a volcano is already erupting, anything it causes is a known event and policies bought afterwards will not cover it. Buy cover the day you pay the deposit on your flights or hotel, not the week before you fly.
3. You assumed it covers anything that goes wrong. It covers a named list of events. Changing your mind, a falling-out with your travel partner, nervousness about a destination or work getting busy are usually not on it. The cancellation section below has the detail.
4. You did not keep the paperwork. This is the one that catches the most people. Suzanne Morrow, chief executive of InsureMyTrip, told Forbes in August 2026 that the most common reason a claim goes wrong is simply missing paperwork. No receipt for the jacket, no police report for the stolen bag, no written note from the airline about the delay, and an otherwise valid claim stalls or fails.
Medical cover: the part that matters most
Whatever passport you hold, assume your home health cover does very little once you leave the country. The detail differs by nationality.
Americans. The US State Department is blunt: it does not pay medical bills abroad, Medicare generally does not cover care outside the US, and while some private health plans pay hospital costs overseas, very few pay to fly you home. It puts medical evacuation at more than $50,000 depending on where you are and what is wrong. Check whether your plan includes overseas emergency care before you buy a policy that duplicates it, and make sure whatever you buy includes evacuation.
Britons. The free UK Global Health Insurance Card gets you necessary state healthcare in EU countries and some others, including Australia, on the same terms as a local. The NHS spells out what it does not do: no private clinics, no mountain or ski rescue and no flight home. It also says plainly that the card is not a replacement for travel insurance, and that not all state healthcare abroad is free. Carry both, and show the card first if you need treatment in a public hospital.
Everyone. Three clauses decide whether a medical claim is paid in full.
- Public versus private hospitals. The Financial Ombudsman notes that most policies cover treatment in public hospitals only, with exceptions for emergencies that could not wait. Resort clinics that ask for a card on arrival are often private. If you can, call the insurer’s emergency line before you are admitted anywhere that is not an emergency department.
- Calling first. Policies ask you to contact the emergency assistance line before treatment. The Ombudsman’s position is that a claim should not automatically fail because you did not, but calling early avoids an argument and gets the hospital paid directly.
- How you get home. You will not be repatriated until the treating doctor issues a fit-to-fly certificate, and the insurer is entitled to choose the cheapest suitable way home. That might be a scheduled flight with extra legroom rather than an air ambulance. It is not unfair, but it is worth knowing before you promise your family you will be home tomorrow.
Activities matter too. Policies list the sports and activities they cover, and anything not on the list may not be. If your plans include skiing, diving, riding a scooter or anything else you would describe as an adventure, check the activities list by name and read the general exclusions before you buy.
Cancellation: covered reasons and the ones that are not
Cancellation cover reimburses prepaid, non-refundable trip costs when you have to call the trip off for a reason on the policy’s list. That list is the whole game. Squaremouth’s summary of what standard US policies include and exclude is typical of UK policies as well.
| Usually covered | Usually not covered |
|---|---|
| Serious illness or injury to you, a travel companion or close family | Changing your mind or a clash in your schedule |
| Death of a family member | Being worried or scared about the trip |
| Severe weather that stops you travelling | Bookings that were refundable anyway |
| A terrorist attack at your destination | Pregnancy and childbirth, unless complications arise (check wording) |
| Your airline or tour operator going bust | War and military action |
| Being made redundant or laid off | Anything already known when you bought the policy |
| Jury service or an unavoidable work transfer | Costs you can recover from the airline, hotel or card issuer |
The last row catches people out. Most policies only pay for losses you cannot get back elsewhere, and the Financial Ombudsman expects you to ask the airline or provider for a refund or compensation before you claim. Insurance sits behind your other rights, not in front of them.
Cancel for any reason: what it really pays
US travellers can add Cancel For Any Reason (CFAR) cover, which does exactly what it says, with conditions. According to Squaremouth, it typically refunds 50% or 75% of your non-refundable costs, not all of them. It usually has to be bought within 14 to 21 days of your first trip payment, you normally have to insure 100% of your prepaid trip costs, and you have to cancel at least 48 hours to three days before departure, depending on the plan. It adds 40% to 60% to the premium.
Our take: CFAR earns its cost on expensive, inflexible trips such as cruises, safaris and tours paid in full months ahead. For a city break built on flights and a hotel, a refundable hotel rate does most of the same job for free, which brings us to the next point.
Baggage, delays and missed departures
Baggage. Every policy has an overall baggage limit and often a lower limit for valuables or single items. The Financial Ombudsman’s own example is a policy that pays up to £1,000 for lost baggage but only £200 for valuables. Limits and excesses are part of the contract, so an insurer applying them is not acting unfairly as long as they were made clear when you bought, and where the wording is unclear the Ombudsman usually reads it in the policyholder’s favour. If you travel with a laptop, a good camera or jewellery, check the valuables limit before you go and consider separate gadget cover or your home contents policy instead.
Keep receipts or photos for anything valuable you pack, because you will have to show what you lost and what it was worth. If something is stolen, report it to the local police and get a written report the same day; as Squaremouth and Forbes both point out, a claim without paperwork is the easiest one to refuse.
Delays and abandonment. Delay cover usually pays a small fixed sum after a set number of hours, which rarely matters much. The bigger benefit is abandonment: according to the Financial Ombudsman, most policies let you abandon the trip and claim your costs if your outbound journey is delayed by a set time, usually 24 hours. You will need evidence of the cause and length of the delay, so ask the airline for written confirmation at the airport or by email before you leave.
UK and EU travellers should also remember that flight-delay compensation from the airline is a separate right. Claim from the airline first; most policies will deduct anything you could have recovered there.
Where your hotel booking fits in
Insurance and hotel booking interact in a way most people miss: a free-cancellation hotel rate is not an insured loss. If you cancel a refundable room, there is nothing to claim, and if you insure it anyway you are paying a premium on money that was never at risk. Squaremouth puts comprehensive cover with trip cancellation at around $35 a day, so trimming the insured trip cost by leaving refundable bookings out is a real saving.
That is why we book hotels on refundable rates for most city trips and insure only the flights, tours and any non-refundable deposits. It keeps the policy cheaper and lets you rebook if the price drops, the approach we explain in how far in advance to book a hotel. Filter for free cancellation when you search, for example on hotels in Lisbon, hotels in Rome or hotels in Paris, and read the cancellation deadline before you pay.
The exception is a non-refundable resort or villa booking, which is common in places like Bali. If you have prepaid a villa you cannot cancel, that cost belongs on the policy. Our guides to where to stay in Bali, Lisbon and Paris flag which hotels tend to sell on strict terms, and if you are weighing a rental against a hotel, our hotel vs Airbnb comparison covers how cancellation rules differ. For Bali specifically, check hotels in Ubud on free-cancellation rates before committing to a prepaid villa.
A claim-proof checklist
- Buy on the day you pay the first deposit. It starts your cancellation cover straight away and, in the US, keeps the 14 to 21-day window for Cancel For Any Reason cover open.
- Answer every medical question for everyone on the policy. Include conditions that are well controlled and anything you are being investigated for. Tell the insurer if your health changes before you travel.
- Check the medical limit and the repatriation wording, especially for the US, Canada and cruises.
- Read the covered cancellation reasons and the activities list, by name.
- Save the emergency assistance number in your phone and on paper.
- Keep a folder of evidence: booking confirmations, receipts for anything valuable you pack, the airline’s written delay notice, police reports, hospital paperwork and every receipt for extra costs abroad. Photograph them as you go.
- Claim from the airline, hotel or card issuer first, then send the insurer what they did not cover, with their response attached.
- If you are refused, ask for the reason in writing. UK policyholders can take an unresolved complaint to the Financial Ombudsman Service, which can tell an insurer to put things right and award compensation.
FAQ
What does travel insurance pay out for most often?
Medical treatment abroad. It was 34% of UK claims in 2024 according to the ABI, and the largest category by value at £262 million. Cancellation, lost belongings and delays follow.
Why do travel insurance claims get denied?
Most often because of an undeclared medical condition, a policy bought after the problem was already known, a cancellation reason the policy does not list, or missing receipts and reports. All four are avoidable.
Does a GHIC replace travel insurance?
No. The NHS says it is not a replacement. It covers necessary state healthcare in participating countries, but not private treatment, mountain rescue or getting you home.
Does Medicare cover me when I travel abroad?
Generally not. The US State Department says Medicare covers care outside the US only in rare cases, and few private plans pay for medical evacuation, which can cost more than $50,000.
Is cancel for any reason cover worth it?
For expensive, non-refundable trips, often yes. It refunds 50% or 75% of costs, must usually be bought within 14 to 21 days of your first payment and adds 40% to 60% to the premium. For flexible city breaks, refundable bookings are cheaper protection.
Do I need to insure a refundable hotel booking?
No. If you can cancel for free there is no loss to claim. Insure non-refundable costs such as flights, tours and prepaid villas, and leave refundable rooms out of the insured trip cost.
How we researched this: the figures in this guide were checked in November 2026 against the Association of British Insurers’ 2024 travel claims data (as reported by ITIJ and Insurance Business), Multitrip.com’s 2025 claims analysis, Squaremouth’s published guidance on denied claims, trip cancellation and Cancel For Any Reason cover, the Financial Ombudsman Service’s travel insurance guidance, the NHS page on the UK Global Health Insurance Card, the US State Department’s health-abroad advice, and Forbes reporting from August 2026. Figures are shown in the currency each source published. This is general information, not advice on a specific policy; your policy wording always takes precedence.
