What is credit card travel insurance, and should I use it?

A travel insurance option that is rising in popularity – credit card insurance. What is this, how does it work, and will it cover everything you need? 

Many banks offer ‘complimentary’ travel insurance as an additional benefit to customers for taking out their credit card. Trusted providers like CommBank, Westpac, ANZ and NAB may offer such an option.

Research we conducted from February 2025 to January 2026* shows that among travellers aged 65 and over, 29% were covered through credit card insurance, and 5% had no international travel insurance. For travellers aged 30–49 18% were covered by credit card nsurance, and 15% were not covered by international travel insurance.   

With that in mind, it’s important to be aware of the pros and cons, and any nasty fishhooks, so you’re prepared for your next adventure. Let’s have a look under the shiny plastic surface of your credit cards! 
 

How does credit card insurance work?

Typically, the insurance is triggered when you book and pay for your holiday using your credit card so it certainly feels like a convenient way to avoid an extra transaction if you’re aware of how you become eligible for the insurance. 

How the activation of your cover works differs by provider – you may be required to purchase at least 50% of your total trip cost (usually restricted to flights only), pay a minimum spend amount, or book through a specific agent. You may need to pay for both your accommodation and your flights on the credit card for it to activate, you may not. 

In other words, having a credit card that offers travel insurance in your purse or wallet does not mean you’re covered – be sure to know if you have activated your travel insurance or you may be left without cover for your big adventure! Always check the details of your credit card bank's international travel insurance documents or contact your credit card bank for advice if you are unsure on the eligibility criteria. 

Pre-existing medical conditions

Understanding how your health is covered when you’re overseas is important. In fact, our research shows that cover for pre-existing medical conditions is important to over 80% of people buying travel insurance, and that the reason most people buy travel insurance is to ensure they are well covered.

Many pre-existing medical conditions may be eligible for cover. Some however may prompt you to pay an additional premium but this depends on a number of risk-related factors.

Credit card travel insurance providers may automatically exclude many pre-existing medical conditions which could result in you not being able to claim for medical assistance when you need it the most. 

Travelling without cover for pre-existing medical conditions may be a reason your travel insurance claim could be denied, so be sure to take your conditions seriously and ensure that you have spoken to your credit card provider or their underwriter if you need assurance. Alternatively, contact a sole purpose travel insurance provider like Southern Cross Travel Insurance and see how we can help.

Will credit card insurance help me out if things go wrong? 

Let’s look at things to consider if you’re opting for credit card travel insurance only: 

Limited coverage to the cardholder only 

Unlike when you buy via a specialist travel insurer, the benefits available under your credit card insurance policy may only apply to the cardholder and not include protection for family members or loved ones who are travelling with you.  

Activation of travel insurance coverage 

Check what you need to do to activate your travel insurance to ensure you’re not caught out without cover.  

Restricted trip duration 

Be sure to check the maximum length of cover, and that it covers your total journey. Limitations could range from two weeks of cover to 90 days so make sure it’s suitable for your trip. 

No cover for domestic travel 

Many credit card providers only offer cover for overseas journeys, so be sure to check if domestic travel insurance is something you want to consider on your next Gold Coast jaunt.  

Age restrictions 

Most credit card insurance policies will have an age limit on cover, and this could be from anywhere as young as 65 years old. Sole purpose travel insurance providers are more likely to offer cover for older travellers.  

Medical coverage limitations 

There may be lower limits on medical coverage including pre-existing medical conditions, especially when it comes to emergency expenses being incurred abroad. Ensure you have appropriate cover – especially in countries like the USA, where hospital bills could well exceed your credit card cover limits. One SCTI claim from the USA in 2023 was in excess of $1.9million (USD). 

Exclusions and conditions 

Hidden exclusions may be present, carefully check your Product Disclosure Statement. Check that any activities that you’re planning to do with a licensed operator are covered, as some credit card insurers may have a blanket exclusion for all sports and related activities.  

Limited customisation 

You may not be able to add cover to your policy for popular activities or your favourite belongings. Moped cover, cruise cover or cover for high value items may also not be available.  

Excess amounts 

Be sure to check how much you’ll need to pay, if you need to make a claim. Excesses typically range from $0 to $250 with sole purpose travel insurance providers mostly offering flexibility to adjust your excess. Similar charges are usually a lot higher with credit card providers. 

Claims process challenges 

Most credit card insurance options have a third-party underwriter, so, given the need to claim, your submission may need to go through two organisations before it is assessed. Some sole purpose travel insurance providers underwrite all policies, meaning decisions could be made faster and there is a greater accountability to customers. 

Consider the total fee amounts

If you’re looking at getting a new credit card that offers travel insurance, be sure to take into account your annual fees, which may result in the ‘complimentary’ travel insurance feeling not so complimentary. 

What are my other options for travel insurance?

If you’re after more comprehensive cover with more customisation and support, choosing your travel insurance through a sole purpose provider may be the better option. 

Sole purpose travel insurance providers offer the flexibility to purchase your insurance at any point before your trip starts (and you’re covered from the date you purchase the policy), so you have the opportunity to do your research before you head off on your adventure. 

If you’re planning on taking a cruise, going skiing, or know you’ll be using a moped for transportation, most sole purpose insurers will offer customisation and cover options for these activities. More activities may also be covered as part of the standard policy, provided that you’re booking through a licensed tour operator (kayaking tour anyone?!).  

There may be more options to choose your excess level depending on what works for you, and options to add your high value items to a policy. 

There are a plethora of travel insurance options out there for your next holiday, but it pays to do your research, and ensure the cover you’re getting is right for your needs. We offer a range of options that could suit your next adventure – check out our policies here. 

Common FAQ's 

Is credit card travel insurance free? While often called "complimentary," it is usually offset by annual credit card fees and specific spending requirements. 

How do I activate credit card insurance? Activation usually requires paying for a portion of your trip (e.g., 50% of flights) on that specific card. 

Does it cover pre-existing conditions? Most credit card insurers automatically exclude many pre existing conditions. 

Are my children covered? Most credit card insurance covers only the cardholder and no additional family members. 

* Based off research conducted by Octopus Research between February 2025-January 2026