Rick Steves Thinks This Type Of Travel Insurance Is A Waste Of Money

Insurance is that thing we all love to hate. You need it if you own a car and you need it when you own a home. It's also a handy accessory when medical insurance is included as part of your benefits package at your job. But purchasing travel insurance is a bit more nuanced. It's hard to know if it's necessary or how much coverage would be appropriate because every traveler's needs are different.

Travel expert and blogger Rick Steves has plenty of thoughts about travel insurance. On his website, Rick Steves' Europe, he calls it a "tricky decision" when deciding what type of insurance to get and suggests you research your own potential risk of loss when traveling, and decide if travel insurance is right for you. However, there is one add-on he suggests you do skip: baggage insurance.

On his blog, Steves calls baggage insurance "statistically the worst value among the many bad values in travel insurance." Insurance policies are complicated, and that goes for travel insurance policies as well. Steves suggests researching any travel insurance you may plan to purchase and to "read the fine print." You may be surprised at the number of things your travel insurance probably does not cover.

So why is baggage insurance such a bad deal? This is because a checked bag is already insured by the airline that received it. Airlines share their lost or damaged luggage insurance information on their sites, so you can check it when you book a trip. So, it's a good idea to do some research on your chosen airline's included policy before deciding if you need more protection.

Understanding how additional baggage insurance works is also important. Steves says that there is a strict reimbursement cap on certain items. He suggests checking with your home insurance policy to see if it covers lost or damaged items anywhere in the world. If it doesn't, then it may be a good idea to purchase additional baggage insurance if what you're checking is more valuable than a typical suitcase packed for vacation.

There are a lot of things that are commonly lost at airports around the world. Luckily, baggage isn't one of them. According to the Société Internationale de Télécommunications Aéronautiques, or SITA, mishandled baggage claims fell in 2024 by nearly 9%. The organization found that only about six in every 1,000 passengers had a piece of baggage mishandled. And that improvement seems to be a trend. Numbers were much worse in the early 2000s when mishandled baggage claims were three times as high. So, do you roll the dice and take the very limited risk of something happening to your checked bags? Even though he doesn't recommend baggage insurance, Steves says "that's up to you."

No one wants to be the last one standing at the baggage carousel, only to conclude that your suitcase is not going to make an appearance. In the rare chance that this does happen, however, it's a good idea to know what your insurance covers (whether it's through the airline or an additional coverage you purchased).

If your baggage is delayed, rather than lost, most policies allow for reimbursement. That means you pay out-of-pocket for things you need and submit a claim to get that money back later. However, there's a wait time involved, meaning a minimum amount of time has to pass before your luggage is officially "delayed" and the terms of the policy kick in.

If your bag is indeed lost, it's the bag owner's responsibility to report it to authorities and to provide receipts for any valuables that are missing. Another downside to baggage insurance that Steves points to is that the strict cap on reimbursement typically affects the coverage of more expensive items like electronics and jewelry. So, getting reimbursed for the full price of an item could be challenging. As with so many things in life, knowledge is power. So before you check your bag, know exactly what airlines owe you if they lose your luggage.