Travel or Trip insurance can easily be confused with travel medical insurance. See Health Insurance for a discussion of the latter.
When booking, I decline every offer of insurance for, trip, interruption, flight cancellation, baggage loss, delay.
Trip insurance promises to reimburse you if your flight is cancelled, you incur costs due to a change in schedule or if the operator goes out of business, if you lose your luggage, if (lots of other things). When I buy a flight on my favorite aggregator site I am offered three different types of insurance with default opt in, and Expedia likes this upgrade so much that they send a follow e-mail playing on my fears if I opt out. My best guess is that trip insurance is an insanely profitable add on. My assessment is that it is much less expensive to self insure.
There is one scenario where I would consider insurance. A ‘trip of a lifetime’, with considerable time at great (relative) expense spent in multiple locations all booked through a single provider would qualify. Think ‘year long around the world cruise’.
I can think of at least five reasons to always decline trip insurance:
The Chase Sapphire Reserve credit card I carry includes a ton of trip related benefits. I do not need more coverage than this.
The events that are insured against are rare. No one had ever stolen my luggage, and the one time that it took a detour the airline jumped through hoops to reunite me with it asap (and one of your credit cards probably has a lost luggage benefit). On the very few occasions that flights have been cancelled entirely, airlines have rebooked me satisfactorily or reimbursed me. Many of my hotel reservations are cancellable without penalty (though post COVID this has changed) so I seldom face a charge if I (which very rarely happens) cannot make it.
International convention has swung powerfully to favour passengers. For example, any flight that touches Europe must reimburse passenger expenses related to lengthy delays. Getting stuck overnight in London on the way from Copenhagen to NYC was expensive, but the claim process was simple and the payout covered every penny.
Full time travel allows a fundamental shift in outlook and schedule. There are very few instances when I absolutely have to be in a particular place at a particular time. Enjoy the last minute change. When a connecting flight from Rio de Janeiro to Asunción was rescheduled for the next day I ‘had’ to spend a night in Curitiba (where?). Had a truly wild night and met people who I am still in touch with.
Trip insurance will not cover the most likely scenario – which is when you have to/choose to change your plans. Dawdling on Martinique on an arc down through the lower Caribbean I learned that a very important person in my life just had surgery scheduled at short notice. It was simply not conceivable to continue with my sunny and carefree plan. I ping ponged to three islands at great expense (while social engineering to reduce that cost as best I could) to return in time, burning my previously purchased tickets and hotel reservations. No insurance covers that scenario, and ’being there’ for someone was worth every lost dollar.