Does Travel Insurance Cover Lost Luggage?

Few travel worries strike fear like lost luggage. It is a nightmare situation to lose your luggage at any point during your trip. According to the U.S. Bureau of Transportation statistics, a total of 2 million bags were mishandled in 2021. The fear of lost luggage has convinced many travelers to pack lighter, opting for suitcase options that fit in overhead bins as carry-ons or in bags they are able to keep on their person at all times.

What causes these lost luggage woes? Experts say there are numerous reasons: incorrect tagging by gate agents, improper loading by ramp personnel or machines, and damage done to the routing label on your bag, to name a few.

What is Baggage Loss Insurance?

Baggage loss insurance is typically a secondary type of coverage that "kicks in" to cover the cost of your lost items after the primary insurance has been paid. This is different from baggage delay insurance which covers costs for items you have to purchase for personal use (like toothbrush or medication) until you receive your missing luggage. Most carriers only allow for expenses needed for a 12 to 24-hour period from the time you should have received your luggage until you are reunited with it.

Both baggage loss and baggage delay insurance are often provided by the travel carrier you book with, and may sometimes be a little-known part of your own homeowners' insurance policy. The coverage limits on these policies can be broken down into three groups.

• Total plan limit (the maximum amount you can receive for your coverage)
• Individual item limit (the total amount you can seek to recover per individual item you lose).
• Specific item limit (excludes certain items for coverage, like laptops or diamond jewelry)

Although baggage insurance offers some coverage for lost luggage and the items contained within it, baggage loss insurance typically offers less coverage than you would receive with a comprehensive travel insurance policy.

Do I Need Travel Insurance to Claim Lost Luggage?

If you have already purchased a travel insurance policy, chances are high that your policy includes a provision for baggage loss and/or delay. Check with your insurance carrier or travel agent to be sure. It is also important to find out individual policy limit amounts for baggage.

Most people seek travel insurance for reimbursement of travel tickets and to ensure they are able to get their money back for unused vacation housing rentals. Many also add travel insurance to protect themselves against the loss of items in their luggage while traveling.

How Much is Baggage Insurance?

Rates for baggage insurance vary from carrier to carrier. If you purchase baggage insurance in addition to or outside of your specific travel insurance policy, you can expect to pay around $400 to $600. The coverage limits for baggage insurance also vary depending on the policy and travel type. Generally speaking, the total limits for coverage usually range between $2,500 and $3,000. Individual item limits range between $300 and $500.

Each company has different policy limits for specific items, and if you plan to carry a Louis Vuitton suitcase and pack it with an expensive laptop, you will want to make sure your plan limits for individual items are enough to cover their replacement costs.

Is Your Luggage Insured When You Fly?

Certain air carriers provide baggage loss and/or delay coverage in the price of your ticket, but you should always check the fine print to ensure your luggage is insured. Don't assume airline baggage liability covers everything – in the case of international travel, it may be wiser to purchase external baggage and/or travel insurance to protect your belongings.

When is Luggage Considered Lost?

Different carriers use different metrics to determine when a bag is actually lost. U.S.-based air carriers, for instance, typically consider a bag lost when it has not been located between 5-14 days.

In some cases, an airline may refuse to declare a bag lost, in which case you have the option to contact the Department of Transportation (DOT) for assistance.

What To Do If Your Luggage is Lost

If the worst happens and your luggage does not arrive on that carousel, there are steps you can take to make sure the claims process goes smoothly:

• Check your airline's policy: The Department of Transportation requires airlines to cover certain costs associated with their mishandling of your luggage. Make sure that the items for which you want to file a claim are covered by your airline's contract of carriage policy. For instance, the United Airlines' contract of carriage excludes replacement of certain electronics like CD players and prescription eyeglasses
• Consider all exclusions/limitations in your policy: Some policies have limits on specific items for which you may need additional coverage
• Gather relevant information and evidence: When filing a claim, you will need to gather all the evidence and paperwork you have to support your claim. This may include original purchase receipts, tickets and boarding passes, travel documents, and pictures of the contents of your suitcase
• Report to the local authorities if your bags are stolen: If you believe (or if the airline has indicated) that your bag has been stolen, you should contact the local police department to file a report
• File a baggage loss claim: You may need to file two claims for your baggage loss: one with your air carrier, and another, with the travel insurance company (depending on the policy)
• Remain in constant contact with the insurance company: Be cooperative with the insurance carrier processing your claim. Provide them with the relevant information and be as responsive as possible when they contact you with questions
• Discuss baggage loss reimbursement: Remember that for domestic flights, the DOT requires airlines to cover certain lost baggage costs, but your particular carrier may cover more.
  
  

Does Travel Insurance Cover Lost Items?

Travel insurance often comes with coverage caveats. You will likely have the coverage for purchase of essential items that you need to buy for days when you are separated from your belongings. Items like clothing, toothpaste, and certain medications may be covered, but there is usually a time limit for these purchases. In addition, you may not be able to seek compensation for certain items like auto equipment, perishable items, household items (like handheld vacuums), and perfumes.

How Much Compensation Do You Get From Lost Luggage?

The DOT sets some maximum limits for airline responsibility if they are found at fault for missing and/or mishandling your baggage. For domestic flights, airlines may pay more than the maximum limit, but must honor a maximum limit of $3,800 per passenger. For international flights, the Montreal Convention sets a limit on airline liability for lost, damaged, or delayed luggage (roughly $1,700).

How to Claim For Lost Baggage

If your bag doesn't appear on the carousel, head to the baggage claim office and file a Property Irregularity Report (PIR) with the airline's customer service, along with a lost luggage claim online. For delayed bags, inquire about covering emergency expenses. You may also file a claim with your travel insurance, and check your homeowner's policies for potential reimbursement. You may be able to accelerate the baggage claim process by keeping thorough documentation of the contents of your bag and regularly following up with the insurer.

What if My Insurance Company Refuses to Pay?

Sometimes, an insurer may refuse payout citing inclement weather, unforeseeable events, or other issues, even when those concerns are not present or have not impacted your lost baggage. Or they may take too much time to process your claim. If you suspect that your insurance company may be acting in bad faith, it is time to contact an insurance dispute law firm.

Does Travel Insurance Cover Lost Luggage: FAQs

What is comprehensive travel insurance?

Comprehensive travel insurance covers delays, cancellations due to illness or death, lost luggage, emergency medical assistance, and other issues you might have after booking travel.

Do you get compensation for lost luggage?

Yes, you may be compensated for lost luggage up to certain amounts when traveling on a U.S.-based air carrier. However, there are exceptions, and understanding them prior to your travel can help you decide whether or not you should purchase additional travel insurance.

How often does luggage get lost on international flights?

Baggage is mishandled and/or lost at a rate of 5.1 per 1,000 travelers.

Does travel insurance cover a lost passport?

You will not receive compensation for a lost passport, but if you lose your passport prior to the scheduled trip departure, then your insurance might cover the cancellation or delay of your trip.

What happens to lost luggage at airports?

Luggage that is lost is corralled into the "lost luggage" area at an airport. Typically, each airline will have a lost luggage space where bags are kept for about 60 days. If bags are not claimed within this time frame, the items may be donated to charity or sold to stores for resale of the items.

Does travel insurance cover damaged luggage?

Possibly. Comprehensive travel insurance plans may cover the replacement cost of your baggage, but you need to check the item limits and possible exceptions.

Does homeowners insurance cover lost luggage?

Your homeowners policy may compensate you for lost luggage. You should check with your carrier to find out if you have coverage before your trip.