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Trip Cancellation Insurance Explained

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Table of Contents

What is trip cancellation insurance?

Covered reasons for trip cancellation, what is not covered by trip cancellation insurance, cancel for any reason trip insurance, is trip cancellation insurance expensive, different ways to get trip cancellation insurance, which insurance coverage is best for me.

When booking travel, particularly expensive trips consisting of nonrefundable reservations, it makes sense to consider trip cancellation insurance since it can protect your deposit if your plans do not materialize due to unforeseen events. However, not every reason for canceling a trip will qualify for coverage, so you’ll want to familiarize yourself with the basics of trip cancellation insurance.

Trip cancellation coverage can be purchased as part of a comprehensive travel insurance policy , or you can receive it for free when you hold certain premium credit cards. The benefit is designed to protect prepaid, nonrefundable reservations, including flights, hotel reservations and other bookings if the trip is canceled due to an extraordinary circumstance. Each policy will state exactly which events are considered valid reasons for cancellations.

With COVID-19 still affecting travel plans, you’ll want to pay close attention to which reasons for cancellation due to the pandemic are valid. For example, wanting to cancel a trip you booked a while ago because your destination now has rising COVID-19 numbers and you’re afraid to travel is not likely a valid reason.

If you want to be able to cancel a trip for truly any reason, consider the Cancel For Any Reason supplemental upgrade when purchasing your insurance policy. CFAR will allow you to get up to 75% of your trip investment back as long as the trip is cancelled at least two days before departure.

» Learn more: Does my travel insurance cover the coronavirus?

Imagine you’ve booked a two-week vacation to Italy costing $5,000 ($1,000 flight, $3,500 hotel and $500 excursions), all of which is nonrefundable. Then, a week before your departure date, you fall and break your leg.

So, what does trip cancellation insurance cover?

If you have trip cancellation insurance, you’ll be able to get your entire prepaid, nonrefundable trip cost back (as long as the entire amount was insured), since injuries that necessitate medical treatment and prevent you from taking your trip qualify as a covered reason.

Other covered reasons include death of your traveling companion, inclement weather that results in disrupted service, jury duty, terrorist incident, job termination and other extraordinary events.

Although this is not an entire list of all the covered reasons, generally the cancellation must be due to unforeseen circumstances to qualify for a reimbursement. Review the fine print of your policy for the details of exactly which reasons are covered. When seeking reimbursement, you’ll need to submit claims to the insurance provider to substantiate your claim.

Although a wide range of reasons allow you to receive your prepaid, nonrefundable travel expenses back in the event of a trip cancellation, there are important exclusions to know about.

Trip cancellation insurance will not cover losses arising from self-harm, foreseeable events, acts of war, taking part in activities considered dangerous (e.g., skydiving, bungee jumping, endurance races, etc.), a felony, childbirth, dental treatment and more.

» Learn more: How to find the best travel insurance

So what if you want the flexibility to cancel your trip for reasons other than those covered by your policy? For that, you're going to need the CFAR insurance mentioned above.

CFAR is often available as an add-on to travel insurance policies, and while it can come in handy if you want to cancel your trip just because, you're not likely to get all your money back.

Most CFAR policies will only reimburse 75% of your nonrefundable travel expenditures.

» Learn more: Best travel insurance with Cancel For Any Reason Coverage

The price of trip cancellation insurance can vary based on the traveler’s age, destination, length of trip, cost of trip and insurance company.

Using the same $5,000, two-week trip to Italy as mentioned above, a search of policies on SquareMouth (a NerdWallet partner) ranged from $115 to $470, representing 2.3% to 9.4% of the total trip cost.

» Learn more: How much is travel insurance?

All policies provide 100% coverage of the trip cost, however the more expensive plans usually have higher limits on benefits like medical evacuation.

If you’re only looking for trip cancellation coverage and no other protections, a policy equating to 2.3% of the total trip expenses seems reasonable.

On your travel credit card

Trip cancellation coverage can be included as part of a comprehensive travel insurance plan or offered as a benefit on premium travel credit cards.

For example, the Chase Sapphire Reserve® will reimburse you or your immediate family members up to $10,000 per trip. The Business Platinum Card® from American Express and many other American Express cards also offer up to $10,000 in trip cancellation coverage. Terms apply.

These premium cards also offer other insurance benefits like trip interruption coverage, emergency assistance services, trip delay and more.

If you travel often and typically purchase trip cancellation coverage, consider applying for one of the cards that offer complimentary travel insurance . Not only will you get trip insurance benefits, but you will also get other travel perks and statement credits that can partly offset the annual fee.

Supplement by purchasing policies out-of-pocket

If the coverage limits offered on the cards aren’t sufficient or you’re looking for more protections (e.g., coverage for emergency medical expenses), you’d be better off with a travel insurance . Although you’d incur an additional cost for purchasing a comprehensive plan, you’d have many more benefits not commonly found in the insurance policies offered by the credit cards.

A comprehensive trip cancellation policy is likely to cover canceled flights so long as the flight or flights are nonrefundable and are a part of the total, prepaid expenses covered by your policy. Insurance provided by travel cards typically includes trip delay or cancellation coverage so long as you used that card to pay for your flight reservations.

If you're forced to cancel your trip due to extraordinary circumstances beyond your control, travel insurance will provide coverage for some or all of your nonrefundable travel expenditures, depending on your policy. Covered events will vary, so be sure to review the terms of any plan you intend to purchase.

Trip cancellation insurance is available for purchase from a wide range of companies and is often included as a benefit on travel credit cards. Under certain circumstances, it provides coverage for prepaid travel expenses in the event that you cannot complete your trip as planned.

A comprehensive trip cancellation policy is likely to cover canceled flights so long as the flight or flights are nonrefundable and are a part of the total, prepaid expenses covered by your policy.

Insurance provided by travel cards

typically includes trip delay or cancellation coverage so long as you used that card to pay for your flight reservations.

If you’re going on a trip consisting of costly flights, hotel reservations and excursions and would like to protect your prepaid, nonrefundable deposit but do not need any other coverage, a minimally priced trip cancellation insurance policy is a good choice.

If you have a premium travel credit card , check if you already have trip cancellation insurance as a benefit before you purchase a policy.

However, if you’re looking for additional coverage like travel medical insurance , and/or a basic plan doesn’t have adequate limits, consider a comprehensive travel insurance policy from providers such as AAA , Allianz , and AIG . Read NerdWallet's full analysis of the best travel insurance companies here .

How to maximize your rewards

You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2024 , including those best for:

Flexibility, point transfers and a large bonus: Chase Sapphire Preferred® Card

No annual fee: Bank of America® Travel Rewards credit card

Flat-rate travel rewards: Capital One Venture Rewards Credit Card

Bonus travel rewards and high-end perks: Chase Sapphire Reserve®

Luxury perks: The Platinum Card® from American Express

Business travelers: Ink Business Preferred® Credit Card

on Chase's website

1x-10x Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Travel℠ immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases.

60,000 Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $900 toward travel when you redeem through Chase Travel℠.

1x-5x 5x on travel purchased through Chase Travel℠, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases.

60,000 Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 when you redeem through Chase Travel℠.

1x-2x Earn 2X points on Southwest® purchases. Earn 2X points on local transit and commuting, including rideshare. Earn 2X points on internet, cable, and phone services, and select streaming. Earn 1X points on all other purchases.

50,000 Earn 50,000 bonus points after spending $1,000 on purchases in the first 3 months from account opening.

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Travel Insurance

What is trip cancellation travel insurance?

Lizzie Nealon

Kara McGinley

“Verified by an expert” means that this article has been thoroughly reviewed and evaluated for accuracy.

Updated 9:17 a.m. UTC Nov. 13, 2023

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• Trip cancellation insurance covers your prepaid, nonrefundable trip expenses if you’re unable to travel due to certain unforeseen circumstances, such as an illness or the death of a family member.
• Trip cancellation insurance generally won’t cover foreseeable or preventable events, such as a hurricane that was named before you bought coverage. 
• Basic trip cancellation insurance typically costs between 5% and 10% of the total cost of your trip.

The average household spent more than $2,000 a year on travel before the pandemic. As traveling rebounds and you’re ready to plan your next trip, a trip cancellation policy can give you peace of mind. But it’s important to understand what trip cancellation insurance does and does not cover.  

What is trip cancellation insurance?

Trip cancellation insurance is a type of travel insurance designed to reimburse you for prepaid, nonrefundable travel expenses when you cancel your trip because of a reason listed in your policy. 

Trip cancellation insurance is often part of a comprehensive travel insurance plan, but it can also be purchased separately. 

You can typically purchase trip cancellation insurance up to the day before your scheduled departure. It’s best, however, to buy a travel insurance plan as soon as you make your first trip deposit. You won’t be charged extra for buying a plan earlier, and you will be covered for a longer period of time.

What trip cancellation insurance covers

Trip cancellation insurance can reimburse you for 100% of your nonrefundable and prepaid trip costs if you cancel for a covered reason, which may include: 

• Death of your travel companion, business partner or family member (policies differ on who is considered a family member).
• Injury or illness of you or a travel companion (documented by a doctor).
• Complications from pregnancy for you or your travel companion.
• Traffic accident en route to departure.
• Mechanical breakdown or other failure of your transportation.
• Mandated shutdown of an airport or air traffic control system.
• Air traffic control or airport shutdown due to fire or power outage.
• Mandatory evacuation due to an unforeseen natural disaster.
• Severe, sudden weather.
• Your home or your trip lodging is uninhabitable due to a natural disaster, vandalism or burglary.
• Hurricane warning or hurricane watch (you must have purchased the policy before the storm was named).
• Terrorist attack.

What trip cancellation insurance does not cover

While trip cancellation policies differ, most plans will not cover incidents that could be foreseen or planned around. For instance, most trip cancellation policies will not cover cancellations resulting from:

• Alcohol or substance use.
• Committing a felony.
• Dental treatment or elective procedures.
• Harm resulting from dangerous activities such as skydiving or bungee jumping.
• Mental or nervous health disorders.
• Normal pregnancy and childbirth.
• Participation in amateur or professional sporting events.
• Self-harm. 

What is “cancel for any reason” coverage?  

If you want to be able to cancel your trip for any reason, not only those specified in your policy, consider buying “cancel for any reason” (CFAR) coverage. This premium upgrade will add about 50% to the cost of your trip cancellation insurance but will give you greater flexibility with your plans.  

CFAR coverage typically reimburses up to 75% of your nonrefundable trip costs when you cancel a trip. But you have to cancel at least 48 hours before your scheduled departure if you hope to file a successful CFAR claim. 

How much does trip cancellation insurance cost?

A basic travel insurance policy with trip cancellation coverage typically costs between 5% and 10% of the total cost of your trip. That means if you take a $5,000 safari trip to Tanzania, your travel insurance might cost between $250 and $500. 

How much you pay for trip cancellation insurance will depend on the travel insurance company, the plan and level of coverage you choose, the number of travelers in your party and their ages, your trip length and trip expenses. 

How to get trip cancellation insurance

Comprehensive travel insurance policies usually include trip cancellation benefits, but you can also buy a standalone trip cancellation policy. 

To shop for trip cancellation insurance, follow these steps. 

• Check if your credit card has travel insurance. If your credit card provides trip cancellation benefits when you pay for trip expenses with that card, you may opt to skip buying a separate trip insurance policy.
• Compare quotes. Choose a travel insurance company by comparing travel insurance plans and quotes online . 
• Buy the plan you want. You can buy travel insurance online. Be prepared to enter your travel dates and destination, the total value of your trip and information about your travel companions.
• Review your plan . After buying travel insurance, you typically have a free look period of 14 or 15 days. If you read the details of your plan and decide it’s not a good fit, you can cancel and request a refund during that period. 

Credit card rewards and trip cancellation insurance

The following cards provide complimentary travel insurance with trip cancellation benefits when you pay for your travel using the card :

• Capital One Venture X Rewards Credit Card * The information for the Capital One Venture X Rewards Credit Card has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. .
• Chase Freedom Flex℠ * The information for the Chase Freedom Flex℠ has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. .
• Chase Sapphire Preferred® Card .
• Chase Sapphire Reserve® .
• Delta SkyMiles® Reserve American Express Card .¹
• Ink Business Preferred® Credit Card * The information for the Ink Business Preferred® Credit Card has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. .
• The Business Platinum Card® from American Express * The information for the The Business Platinum Card® from American Express has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. .¹
• The Platinum Card® from American Express .¹
• United℠ Explorer Card * The information for the United℠ Explorer Card has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. .
• United Club℠ Infinite Card * The information for the United Club℠ Infinite Card has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer.

All information about The Business Platinum Card® from American Express has been collected independently by Blueprint.

Check to see if your credit card offers travel insurance with trip purchases and what coverage it provides. Travel insurance provided by credit cards isn’t usually as comprehensive as a separate policy.

Frequently asked questions (FAQs)

Trip cancellation insurance reimburses you for prepaid, nonrefundable expenses if you need to cancel a trip for a covered reason. Valid reasons for trip cancellation typically include unforeseen events such as a death in the family, sudden weather that leaves your destination uninhabitable or an illness that is documented by a doctor.

Most travel insurance plans bundle together several types of coverage, including trip cancellation insurance. If you have trip cancellation insurance, you can file a claim for any prepaid and nonrefundable expenses associated with a trip when you decide to cancel for a reason listed in your policy. 

When it comes to travel insurance, you’re not limited to cancellation coverage. The best comprehensive travel insurance plans also include coverage for incidents related to epidemics, emergency medical needs, baggage loss and damage, travel delays and trip interruption.

¹Eligibility and Benefit level varies by Card. Terms, Conditions and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by New Hampshire Insurance Company, an AIG Company.

For Capital One products listed on this page, some of the above benefits are provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply.

*The information for the Capital One Venture X Rewards Credit Card, Chase Freedom Flex℠, Ink Business Preferred® Credit Card, The Business Platinum Card® from American Express, United Club℠ Infinite Card and United℠ Explorer Card has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer.

Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.

Blueprint has an advertiser disclosure policy . The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.

Lizzie's commentary has been published in Bankrate, CNBC, the Washington Post, the Washington Examiner, MSN and more.

Kara McGinley is deputy editor of insurance at USA TODAY Blueprint and a licensed home insurance expert. Previously, she was a senior editor at Policygenius, where she specialized in homeowners and renters insurance. Her work and insights have been featured in MSN, Lifehacker, Kiplinger, PropertyCasualty360 and more.

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What Is Trip Cancellation Insurance?

One of the leading reasons travelers elect to purchase travel insurance is for trip cancellation benefits. However, many of those who do purchase travel insurance often have a broken understanding of what exactly trip cancellation insurance covers. Is "trip cancellation" truly as all-encompassing as many believe?

Although trip cancellation benefits are one of the most commonly found travel insurance benefits, it is possibly the most misunderstood. While trip cancellation insurance  can  provide assistance in the worst case scenario, it also comes with a very strict set of rules and regulations. Before canceling your trip and filing a claim for trip cancellation, be sure to understand what this particular benefit will - and won't - cover.

Trip Cancellation Insurance

Trip cancellation insurance is nearly universally available when purchasing a travel insurance policy. The benefit does exactly what it claims to do: those travelers who are forced to cancel their trip for a qualified reason may have their non-refundable fees reimbursed through a travel insurance claim. Those specific reasons may include (but are not limited to):

• The death of the traveler, their travel companion, or an immediate family member.
• An accidental injury immediately before or on the way to their departure
• An  Unforeseen natural weather occurrence at the destination (before being declared a "known event")
• A legal obligation that will interfere with the trip (such as being called for jury duty or as a witness in a trial).

However, missing from this list of commonly approved trip cancellation situations are many other life-changing situations, Employment obligations, unexpected life events (including pregnancy), and other personal situations may also be excluded from traditional trip cancellation insurance benefits. Those who are concerned about these situations affecting their travels may want to consider adding optional benefits to their plan.

Are work reasons covered under trip cancellation insurance?

Under some trip cancellation insurance plans, certain employment situations may  be covered. Travelers who are unexpectedly laid off or unemployed through no fault of their own may be able to recover their non-refundable deposits through their trip cancellation benefits.

However, other situations may not necessarily be covered under trip cancellation insurance. Travelers who are forced to cancel their trip due to starting a new job or are called into work during a vacation period may not necessarily be covered through trip cancellation. Those who are concerned about their employment may want to consider a travel insurance plan with a "Cancel for Work Reason" benefit. 

Cancel for Work Reasons is often an add-on benefit offered through some travel insurance plans. Adding a Cancel for Work Reasons benefit will add a nominal fee to the overall policy, while adding trip cancellation clauses, including (but not necessarily limited to): 

• A change of work schedule, forcing the traveler to work during your scheduled trip
• An unforeseen emergency situation, including natural disaster, fire, or vandalism
• The traveler's company is involved in an acquisition or merger
• The company relocates the traveler over 250 miles.

In order to submit a claim through trip cancellation insurance, travelers must provide documented proof of the event taking place. Those who cannot provide documentation run the risk of having their claim denied.

Can I cancel for any reason with trip cancellation insurance?

There are some life situations travelers face which make them uncomfortable about traveling. Whether it is the threat of terrorism , an active winter storm season , or a veterinary emergency , travelers can have many different reasons to consider canceling their next trip. Although trip cancellation insurance may not cover all of these unique situations, a "Cancel for Any Reason" benefit can help travelers reclaim most of their non-refundable trip costs.

In order to add a Cancel for Any Reason benefit to a travel insurance plan, travelers much purchase their travel insurance plan within days of their initial deposit (usually between 14 and 21 days) and pay an additional fee. In addition, travelers must also insure the entire cost of their trip, regardless of any other travel insurance they may have. Once added, travelers have the freedom to cancel their trip for literally any reason. When a claim is filed, travelers may be reimbursed for a portion of their non-refundable trip costs. The most common Cancel for Any Reason benefits cover between 50% and 75% of the non-refundable trip costs.

While trip cancellation insurance may sound like a free pass to cancel travels, modern adventurers need to know what their travel insurance plan actually covers. By knowing what trip cancellation insurance actually covers and the difference in all trip cancellation benefits, travelers can ensure they are buying what they actually need.

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Please Note - If you are cruising around Australia you need to select Pacific. With Regions, variances can apply for Bali, Indonesia, Japan and Middle East. You are not required to enter stop-over countries if your stop-over is less than 48 hours.

If you don’t know where you’re traveling to within the next 12 months, choose Worldwide to ensure you’re covered no matter where you go. If you’re travelling to multiple countries choose the region that you are visiting that is furthest away (excluding stopovers less than 48 hours). In most cases you will be covered for the closer regions as well. For example, if you choose Europe, you will also be covered in the Middle East, Asia and Pacific.

Worldwide means anywhere in the world

Americas means USA, Canada, South America, Latin America, Hawaii and the Caribbean

Europe means all European countries, including UK

Middle East refers to the area from Syria to Yemen; Egypt to Iran

Asia generally means Asia and the Indian subcontinent. For some insurers this excludes Japan*

Pacific means the South West Pacific, Australia and Indonesia/Bali*. Select Pacific for domestic cruises in New Zealand waters

New Zealand means domestic travel within New Zealand only

*Note: Variances apply for Bali, Indonesia, Japan and Middle East. Check that your destination is covered once directed to your chosen insurer’s site.

Travel Insurance Cancellation Cover

The common misconception is that all cancellations, delays, or missed travel situations are covered by travel insurance, but this is not the case. We help explain the misunderstandings around travel insurance and cancellation cover, so that you can head on holiday knowing when you're covered.

What is  Cancellation cover?

If you have a comprehensive travel insurance policy , it includes cancellation cover. Cancellation cover varies across insurers, but it generally means the lost deposits and cancellation fees for pre-paid holiday arrangements due to unforeseen circumstances, which are not expected, intended, or within your control. Different sections of your travel insurance policy relate to different times and parts of your trip. Generally, anything that happens before travelling falls under ‘Cancellation’ and anything that happens once you have already started your journey will generally fall under ‘Alternative Transport Expenses’, ‘Travel Delay Expenses’ or 'Disruption of Journey'. But they are all different remedies to unforeseen circumstances which might affect your trip.

What are "unforeseen circumstances"? 

...and when are you covered for travel delays, alternative transport and cancellation? Provided that you purchased your policy before you became aware of the circumstances (or they were published in the media), commonly covered scenarios include:

Bad weather or natural disasters

If your flight or cruise is cancelled due to severe weather or a natural disaster , such as a volcanic eruption, tornado, or bushfire, you may be able to claim for transport, accommodation and other pre-paid expenses. Most insurers also offer cancellation cover if your home in Australia is affected by a natural disaster, and you need to defend it or if it is rendered uninhabitable by a flood, fire, or explosion.

Sickness or injury

If you become injured or ill and become unfit to travel, or if you have to return home if a medical practitioner notifies the insurer that you are unfit to continue with your trip. You will need this in writing and it generally cannot be from an undeclared  pre-existing medical condition .

Sickness or injury of a family member

If you need to return home or cancel a trip because a family member is unwell or there has been a death of a close family member. This is subject to limitations - most insurers do not cover if the relative is over 80-85, if they were hospitalised due to a  pre-existing medical condition , or the relative resides outside Australia or New Zealand. Check out our guide on family emergencies for more.

Strikes, civil unrest or riots

If a strike , civil unrest or riot directly affects your flights or accommodation. If the unrest or rioting hasn't directly affected your travel arrangements, cancelling your trip may be considered by your insurer as a 'change of mind' scenario, which is generally not claimable.

Accident en route

If you missed your flight/booked transport because of a motor vehicle accident, railway accident or marine accident en route and you can prove that there was no other way for you to get to your transport carrier. You will generally need a letter from an authority, such as the police or transport provider to prove the accident happened.

Theft of passports, travel documents or credit cards

If your passport or documents are stolen, travel insurance will reimburse you for your expenses incurred when replacing your items, as well as cancellation fees or lost deposits if you are unable to continue your journey due to theft of your passport.

Getting to special events

If your flight or other transport has been cancelled or delayed, and you need to reach a special event, such as a sporting event, wedding, or funeral, many insurers cover your alternative transport expenses to get there on time - even if the reason your flight or transport was cancelled was the airline's fault. Different insurers consider different things a 'special event', so check that your policy does what you need it to.

Delays or disruption of journey

If you experience a flight delay (typically of more than six hours), and your airline doesn't look after you, your travel cover can provide accommodation and food benefits of around $200-$250 per adult for each day the disruption occurs. If you miss a connecting flight due to the first airline's fault, some insurers also cover the cost of getting you on a new flight - provided that you've left at least 3-5 hours for connections. Check your insurer's policy documents to see if they offer this, or give them a call.

Cancellation of annual leave - if you're in the emergency services

Many insurers cover full-time defence force, police and other emergency service personnel coverage if their annual leave is revoked. Again, each insurer is different on this, so be sure to check your policy works for your circumstances.

cancellations that are  not covered

Cancellations where the airline is responsible.

If your flight was cancelled due to a mechanical fault, overbooking, maintenance, repairs, rescheduling, service faults, a pilot sleeping in, or the airline closing down then you are generally covered. It is the airline’s responsibility to compensate, reimburse, or find an alternative flight for the traveller – not the insurer. The exception is where insurers offer alternative transport expenses or disruption of journey benefits, which help you get to a special event, like a wedding, or cover meals and accommodation, regardless of whether the airline was at fault.

Missing flights where you're responsible

Slept in? Turned up to check-in too late? Delays caused by your negligence are not covered under travel insurance. Insurers will ask that you left ‘sufficient’ time to get to the airport. This includes missed connecting flights .

Cancellations due to undeclared pre-existing conditions

If you cancel because of a pre-existing condition that you didn't declare, or a family emergency where the cause is a pre-existing condition.

Change of mind

If you decide you don't want to go on holiday anymore, travel cover won't cover you.

Cancellation of annual leave

Unless you're in the defence force, police, or other emergency services, you're generally not covered if your employer revokes your annual leave.

Visa refusals or not having the appropriate documents

If your destination visa is denied and you've already paid for flights and accommodation, travel insurance cannot help, as it’s up to the traveller to verify that their visa requirements have been met. Likewise, if you are turned away from the foreign country because you weren't aware of a visa requirement, most insurers consider this to be a general exclusion. In some cases, the airline might refund your tickets as they're not allowed to fly passengers to a country without a visa.

If you or another member of your group is suddenly required to sit an exam and cannot travel then most travel insurance will not cover your travel costs.

Underbooked tour

If your tour is cancelled due to underbooking, this is generally not a covered situation.

A travel insurance policy is a legal document and yet so many travellers chose not to read the Product Disclosure Statement which explains in detail all the policy benefits. Each insurer has a list of inclusions and exclusions, to avoid any doubt, check this before you travel.

Insolvency of a travel provider

If your travel agent, tour provider or airline becomes insolvent, very few insurers cover this. Check out our guide to learn more about who covers different travel company insolvency situations.

Claiming for  travel cancellations

Claiming for trip cancellations doesn't have to be difficult. Check your insurer's product disclosure statement, and read through the sections on cancellations, alternative transport expenses, travel delays, etc, as well as the general exclusions so you're aware of what you can and can't claim for. Find your insurer's claims web page, fill out the form and upload your documents. You'll generally need copies of your itineraries, refund advice, proof of payments and proof of the reason for your trip cancellation - this will vary depending on the reason you need to cancel your holiday. Visit our guide more on claiming for travel cancellations and delays .

Compare  Cancellation Coverage 

It depends on which policy you choose. Most insurers offer different cover levels and often at very different price points. We've compared the cheapest comprehensive-style policy offered by each insurer to give you a rough idea. To compare coverage and prices for your trip, use our quote function above.

Trip Cancellation FAQs

Does holiday insurance cover cancellation due to work.

Your trip cover may cover work-related issues, depending on your circumstances. If you are a full-time employee and are made redundant, you may have provision to claim with some insurers. Additionally, if you are a full-time employee of the defence forces or emergency services and your annual leave is revoked, many insurers will cover you for cancelling your trip. Checking for benefits like this can help in the long run.

Does travel insurance cover accommodation cancellations?

Comprehensive travel insurance includes cancellation benefits for accommodation, flights, and other pre-paid deposits if you need to cancel your trip due to illness, injury, natural disasters, family emergencies, and other unforeseen circumstances.

Does trip insurance cover cancellation or delays due to natural disasters?

Yes, provided that you were unaware of the natural disaster, and it hadn't been published in the mass media, you may have provision to claim for a cancellation due to natural disaster . However, some insurers have natural disaster add-ons which aren't automatically included. Other insurers only cover for natural disasters occurring within Australia - so check your policy before you buy.

Does travel insurance cover cancellations due to strikes or riots?

Yes, provided you didn't know about the strike or rioting beforehand, it would generally be covered with most insurers. You would have to demonstrate that the strike or riot directly affected you though - so get a letter from your airline or accommodation or tour provider as evidence.

Does holiday insurance cover cancellations due to terrorism or war?

Very few insurers offer cancellation coverage for terrorism or acts of war - this is often a general exclusion, or they will only cover medical expenses if you are injured. Check your policy documents before you buy to confirm what coverage is available.

Does trip insurance cover cancellations if I don't want to go anymore?

No, there are no insurers that we are aware of which cover if you cancel your trip and change of mind.

Does insurance cover cancellation due to sick pets?

While you might think of your pets as a member of the family - we certainly think of ours that way - but most insurers do not cover you to cancel your trip if your furry buddies become ill. However, some insurers will cover your pets for veterinary treatment. 

Crystal Moran

With a research and journalism background, and certified in Tier 2 General Insurance General Advice, Crystal is passionate about investigating customers’ tricky travel questions and helping them find the answers they’re looking for. A writer and filmmaker whose favourite trips have been to film festivals in Cuba and South Korea, and campervanning around the USA, she loves getting to know new people and seeing a glimpse of the world through their eyes.

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You’re covered for cancellation – but do you know what that really means?

When it comes to getting your  travel insurance direct  from a provider, many of us want that little nugget we know as cancellation cover.

But then we put in a claim for something we’ve cancelled and –  whoa!  – it gets denied. Why? What went wrong?

A quick explanation of cancellation cover

In a nutshell, cancellation cover, in terms of travel insurance, means that if something goes wrong and it is necessary and unavoidable to cancel your trip before you head off, you may be able to claim back money you otherwise have lost (up to the amount stated in your insurance policy).

For instance:

• Diane books an end-of-year trip to Paris. A week before she’s scheduled to depart, she’s injured in a minor car accident and isn’t allowed to travel. She has to cancel her flights (which cost $2,500) and her hotel booking (which cost $1,800).
• Neither the airline or the hotel will give Diane a refund, meaning she’s now out of pocket for $4,300. But through her travel insurance, Diane can recover the money she’s lost less any excess payable.

What exactly can you claim for under cancellation cover?

Cancellation generally covers you for the cost of cancelled flights, hotels, visas, tours/excursions, paid-for activities or sports, and prepaid meals, less applicable excess. This is all assuming that the expenses cannot reasonably be recovered from any source.

If you booked your trip through a travel agency and they charged you fees, you might be able to claim back some of these costs too, depending on your policy.

Getting the ’emergency’ circumstances of your claim right

What constitutes an emergency at InsureandGo?

• The unforeseeable  death, injury, or illness  of you (or your relative, business associate or travelling companion, in some instances).
• A  fire, storm, flood or burglary  at your home or place of business within 48 hours of your leaving date.
• When you, your relative or travelling companion are a member of the armed forces, police, fire, nursing or ambulance services and you have to stay in Australia because of an emergency or you are posted overseas.
• Fallin g pregnant after purchasing the Policy and where you will be more than 30 weeks pregnant (or 20 weeks for multiple pregnancies) at any time during your trip or where your doctor advises you’re unfit to travel due to complications of pregnancy and childbirth.
• A  cancelled education or tuition course overseas,  if the sole purpose of your trip is to attend that course and it was cancelled due to circumstances outside your control.

What aren’t you covered for?

Cancellation won’t cover you if you simply change your mind about your trip or fail to organise your trip properly – e.g. if you book the wrong leaving date or you didn’t organise your visa/passport in time.

You also won’t be able to claim under cancellation if you can’t get leave from your job, if you miss your flight (or similar) or if you didn’t tell the appropriate organisations that you cancelled your trip and were charged extra because of this.

What happens if you need to cancel your trip after you depart?

Take note! Cancellation only covers you if you cancel your trip before your planned leaving date.

If you want cover for cancelling your trip after you leave, you’ll need to choose a policy that offers:

• Trip Curtailment  , which will cover you (for up to the amount in your policy) if you need to cut your trip short and return home.
• Journey Resumption  , which covers the cost of your airfare from Australia if you’ve returned home (due to an emergency) and then need to pick up the same trip later on.

Just how much money can you claim back?

How much money you can claim under cancellation will depend on the limits in your specific travel insurance policy (by the way: Limits means the maximum amount of money you can claim).

• Some insurance levels (such as InsureandGo gold) offer  unlimited cover  if you cancel your trip. This means your claims aren’t capped, so you can claim back the costs of any prepaid flights, hotels etc. if cancellation of your trip is necessary and unavoidable due to any one of the many reasons listed in the policy.
• Sam does the right thing and insures his trip to New York, but it only includes $4,000 of Cancellation cover. Due to a death in the family, Sam has to cancel. His flights cost $3,000 and his hotel bookings cost $2,500.
• Sam can only claim back $4,000 in cancellation, so he loses $1,500 of his own money.

Add up the total cost of all your bookings to see if your cancellation limit is enough to cover you if you end up cancelling your trip.

InsureandGo offers unlimited cancellation cover under our gold policy, and up to $15,000 in cancellation under our silver policy. Grab a quote now!

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Unlimited overseas medical expenses cover

Unlimited cancellation in our Gold policies

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• Plan Your Trip
• Safety & Insurance

What Is Cancellation Cover In Travel Insurance

Published: December 18, 2023

Modified: December 28, 2023

by Emera Mcglothlin

• Sustainability

Introduction

Traveling can be an exhilarating experience, offering the opportunity to explore new destinations, immerse oneself in different cultures, and create lasting memories. However, amidst the excitement of planning a trip, it's crucial to consider potential unforeseen circumstances that may disrupt or cancel your travel plans. This is where cancellation cover in travel insurance becomes a vital aspect to safeguard your investment and provide peace of mind.

When embarking on a journey, whether for leisure or business, various factors such as sudden illness, adverse weather conditions, or unexpected emergencies can lead to the cancellation or interruption of your trip. In such instances, having comprehensive cancellation cover can alleviate financial burdens and mitigate the impact of unforeseen events.

Cancellation cover is designed to protect travelers from financial loss in the event of trip cancellation, interruption, or delay. Understanding the specifics of this coverage is essential for travelers to make informed decisions and ensure adequate protection throughout their travels. In this article, we will delve into the intricacies of cancellation cover in travel insurance, exploring its significance, components, and how to select the most suitable coverage for your travel needs. Whether you are planning a relaxing beach getaway, an adventurous hiking expedition, or a crucial business trip, having a clear understanding of cancellation cover is paramount to safeguarding your travel investment and enhancing your overall travel experience.

Understanding Cancellation Cover

Cancellation cover, also known as trip cancellation insurance, is a fundamental component of travel insurance that provides financial protection in the event that you need to cancel or interrupt your trip due to unforeseen circumstances. This coverage is designed to mitigate the financial losses associated with non-refundable deposits, prepaid expenses, and cancellation penalties incurred as a result of unexpected events.

One of the key aspects of understanding cancellation cover is recognizing the diverse scenarios it encompasses. Whether you need to cancel your trip before departure or cut it short due to an unforeseen event, cancellation cover offers a safety net to minimize the financial repercussions. It typically extends to various situations, including but not limited to sudden illness or injury, the death of a family member or travel companion, natural disasters, airline strikes, and other unforeseen events that may disrupt your travel plans.

It’s important to note that cancellation cover is not a one-size-fits-all solution. The specifics of the coverage, including the covered reasons for cancellation, vary among insurance providers and policies. Understanding the terms and conditions of your cancellation cover is essential to ensure that it aligns with your specific travel needs and provides adequate protection in the face of unexpected eventualities.

Furthermore, cancellation cover is not limited to reimbursing the prepaid expenses for flights and accommodations. It may also extend to additional expenses incurred due to trip interruption or delays, such as additional accommodation, transportation, and non-refundable expenses that may arise from the disruption of your travel plans.

By comprehending the scope of cancellation cover and its relevance in safeguarding your travel investment, you can make informed decisions when selecting a travel insurance policy. The next section will delve into the specific components included in cancellation cover, shedding light on the comprehensive protection it offers to travelers.

What Does Cancellation Cover Include?

Cancellation cover encompasses a range of components that collectively provide comprehensive protection against unforeseen events that may disrupt your travel plans. Understanding the specific inclusions of cancellation cover is essential for travelers to gauge the extent of protection offered by their travel insurance policy. Here are the key components typically included in cancellation cover:

• Reimbursement of Non-Refundable Expenses: Cancellation cover typically reimburses non-refundable expenses, such as prepaid airfare, accommodations, and tour packages, in the event that you need to cancel your trip due to covered reasons, such as illness, injury, or other unforeseen events.
• Coverage for Trip Interruption: In addition to trip cancellation, cancellation cover often extends to trip interruption, providing reimbursement for the unused portion of your trip if you are forced to return home prematurely due to covered reasons.
• Protection for Additional Expenses: Cancellation cover may include coverage for additional expenses incurred as a result of trip interruption or delays, such as accommodation, transportation, and other necessary expenses that arise due to unforeseen events.
• Emergency Assistance and Support: Many travel insurance policies with cancellation cover offer access to 24/7 emergency assistance services, providing support and guidance in navigating unforeseen situations while traveling.
• Flexibility in Covered Reasons: Some cancellation cover policies offer flexibility in the covered reasons for trip cancellation, encompassing a wide range of unforeseen events, including job loss, legal obligations, and other unexpected circumstances.

It’s important for travelers to review the specific details of cancellation cover included in their travel insurance policy, as the inclusions may vary based on the insurance provider and the type of policy selected. By gaining clarity on the components of cancellation cover, travelers can assess the extent of protection offered and make informed decisions when planning their trips.

Understanding the inclusions of cancellation cover is crucial for travelers to ascertain the level of financial protection provided by their travel insurance policy. The following section will delve into the significance of cancellation cover and why it is an indispensable aspect of travel insurance.

Why Is Cancellation Cover Important?

Cancellation cover plays a pivotal role in mitigating financial risks and providing peace of mind for travelers, making it an indispensable component of travel insurance. Understanding the importance of cancellation cover is essential for travelers to grasp the value it adds to their overall travel experience. Here are key reasons why cancellation cover is crucial:

• Protection Against Unforeseen Events: Unforeseen circumstances, such as sudden illness, injury, or the death of a family member, can necessitate the cancellation or interruption of a trip. Cancellation cover provides financial protection against such events, ensuring that travelers do not incur substantial losses due to non-refundable expenses.
• Preservation of Travel Investment: Travel expenses, including airfare, accommodations, and tour bookings, often involve non-refundable deposits and cancellation penalties. Cancellation cover safeguards the financial investment made in these arrangements, offering reimbursement for prepaid expenses in the event of covered cancellations or interruptions.
• Peace of Mind and Security: Knowing that cancellation cover is in place provides travelers with a sense of security and peace of mind, allowing them to focus on their travel experiences without the looming concern of financial loss in the face of unforeseen events.
• Mitigation of Trip Disruptions: In the event of trip interruption or delays due to covered reasons, cancellation cover extends to provide reimbursement for additional expenses, such as accommodation and transportation, mitigating the impact of unforeseen disruptions on travel plans.
• Flexibility and Adaptability: Cancellation cover offers flexibility in accommodating a wide range of covered reasons for trip cancellation, providing travelers with the adaptability to address unforeseen events that may arise before or during their travels.

By recognizing the significance of cancellation cover, travelers can make informed decisions when selecting a travel insurance policy, ensuring that their travel investment is safeguarded against unforeseen events. The next section will provide insights into how travelers can choose the right cancellation cover to suit their specific travel needs and preferences.

How to Choose the Right Cancellation Cover

Choosing the right cancellation cover is a critical aspect of securing comprehensive protection for your travels. With various options available in the realm of travel insurance, understanding how to select the most suitable cancellation cover is essential for travelers to ensure adequate protection aligned with their specific needs. Here are key considerations to guide you in choosing the right cancellation cover:

• Evaluate Your Travel Plans: Assess the nature of your trip, including destination, duration, and planned activities. Understanding the specifics of your travel itinerary will aid in determining the level of cancellation cover required to safeguard your investment.
• Review Covered Reasons: Examine the covered reasons for trip cancellation and interruption provided by different insurance policies. Look for comprehensive coverage that encompasses a wide range of unforeseen events, offering flexibility in addressing potential trip disruptions.
• Assess Coverage Limits: Evaluate the coverage limits for trip cancellation, ensuring that the policy offers reimbursement for non-refundable expenses up to a sufficient amount to cover your travel investment.
• Consider Additional Benefits: Look for cancellation cover policies that offer additional benefits, such as coverage for pre-existing medical conditions, emergency medical assistance, and other travel-related services that enhance the overall protection provided.
• Compare Policy Exclusions: Pay attention to the exclusions specified in cancellation cover policies, ensuring that you are aware of any limitations or conditions that may impact the coverage provided.
• Seek Professional Guidance: If navigating the complexities of cancellation cover and travel insurance seems daunting, consider seeking advice from insurance professionals who can provide insights and recommendations tailored to your specific travel needs.

By meticulously evaluating these considerations and conducting thorough research on available travel insurance options, you can make an informed decision when selecting the right cancellation cover for your travels. Understanding the nuances of cancellation cover and its alignment with your travel plans is instrumental in ensuring that you embark on your journeys with confidence and financial security.

As you navigate the process of choosing the right cancellation cover, it’s essential to prioritize comprehensive protection that aligns with your travel needs and preferences. The next section will summarize the key insights presented in this article, emphasizing the significance of cancellation cover and its role in enhancing the travel experience.

As travelers embark on journeys filled with anticipation and excitement, the significance of cancellation cover in travel insurance cannot be overstated. This essential component serves as a safeguard against unforeseen events that may disrupt travel plans, offering financial protection and peace of mind throughout the travel experience.

Understanding the intricacies of cancellation cover, including its inclusions, flexibility, and relevance to diverse travel scenarios, empowers travelers to make informed decisions when selecting a travel insurance policy. By evaluating the covered reasons, coverage limits, and additional benefits offered by various cancellation cover policies, travelers can align their protection with the specific nuances of their travel plans, ensuring comprehensive coverage that addresses potential trip disruptions.

Moreover, recognizing the importance of cancellation cover in preserving travel investments, mitigating financial risks, and providing adaptability in the face of unforeseen events, underscores its indispensable role in enhancing the overall travel experience. With cancellation cover in place, travelers can embark on their journeys with confidence, knowing that their financial investment is safeguarded and that they have a safety net to navigate potential trip interruptions.

Ultimately, the process of choosing the right cancellation cover involves careful consideration of travel plans, coverage details, and policy inclusions, culminating in a decision that prioritizes comprehensive protection tailored to individual travel needs and preferences. By embracing the value of cancellation cover and its role in enhancing the travel experience, travelers can embark on their adventures with a sense of security, flexibility, and readiness to embrace the enriching experiences that travel offers.

In conclusion, cancellation cover in travel insurance serves as a cornerstone of financial protection, offering travelers the assurance and resilience to navigate unforeseen events and disruptions, ultimately contributing to a more secure and enjoyable travel experience.

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Trip Cancellation

Insurance benefits underwritten by BCS Insurance Company (OH, Administrative Office: 2 Mid America Plaza, Suite 200, Oakbrook Terrace, IL 60181), rated “A” (Excellent) by A.M. Best Co., under BCS Form No. 52.201 series or 52.401 series, or Jefferson Insurance Company (NY, Administrative Office: 9950 Mayland Drive, Richmond, VA 23233), rated “A+” (Superior) by A.M. Best Co., under Jefferson Form No. 101-C series or 101-P series, depending on your state of residence and plan chosen. A+ (Superior) and A (Excellent) are the 2nd and 3rd highest, respectively, of A.M. Best's 13 Financial Strength Ratings. Plans only available to U.S. residents and may not be available in all jurisdictions. Allianz Global Assistance and Allianz Travel Insurance are marks of AGA Service Company dba Allianz Global Assistance or its affiliates. Allianz Travel Insurance products are distributed by Allianz Global Assistance, the licensed producer and administrator of these plans and an affiliate of Jefferson Insurance Company. The insured shall not receive any special benefit or advantage due to the affiliation between AGA Service Company and Jefferson Insurance Company. Plans include insurance benefits and assistance services. Any Non-Insurance Assistance services purchased are provided through AGA Service Company. Except as expressly provided under your plan, you are responsible for charges you incur from third parties. Contact AGA Service Company at  800-284-8300 or 9950 Mayland Drive, Richmond, VA 23233 or [email protected] .

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Covered reasons for trip cancellation explained

• November 6, 2023

We’re here to pull back the curtain on trip cancellation and break down the ways you’re covered. In this post we go through the “fine print” you need to know in order to understand what’s protected under your trip cancellation benefit with your Faye plan.  

First of all, what is a covered reason?

Covered reasons are specific events that may happen to you or your travel companion that deem you eligible to make a claim and receive reimbursement on approved claims.

With Faye, trip cancellation coverage is built into most plans that are purchased more than 48 hours before your departure date. Meaning you’re covered for up to 100% of unused, prepaid non-refundable trip costs, including covered flights, hotel bookings, tickets & activities. FYI: your trip cost is determined by the dollar amount you provide to us when you purchase a Faye plan so make sure it reflects the sum of the non-refundable expenses for your trip (best practice: exclude refundable expenses, i.e. refundable airfare, as it would be given back by the airlines directly). If you have any questions, you can always call our 24/7 support team and increase the trip cost pre-trip if needed. 

Faye’s trip cancellation covered reasons

Now to get into the specifics of what Faye’s trip cancellation coverage protects. You can be reimbursed for any of the following covered, unforeseen events:

Medical complications and death

• Your, a family member’s, a traveling companion’s, a traveling companion’s family member’s or business partner’s death that occurs before departure on your trip.
• Your, a family member’s, a traveling companion’s, traveling companion’s family member’s or business partner’s, sickness or injury, that occurs before departure and is examined and treated by a physician prior to cancellation (unless it is not reasonably possible to do so); and as certified by a physician, results in medical restrictions so disabling as to cause you to cancel your trip.
• Sickness or injury of your business partner must be so disabling as to reasonably cause you to cancel your trip to assume daily management of the business.
• You or your traveling companion have complications of pregnancy, which are verified by medical records and such complications occur after the effective date of coverage.
•  Your host at your scheduled destination is unable to provide accommodations due to a life-threatening sickness or injury, or due to their death.
• You or your traveling companion are quarantined.

Natural disasters and transportation issues

• You or your traveling companion are directly involved in a traffic accident, while en route to your scheduled trip departure city, documented by a police report.
• Mandated shut down by local government authorities of an airport or air traffic control system resulting in the complete cessation of services (other than terrorism or act of war) for at least 6 consecutive hours of your air common carrier.
• Due to a natural disaster, a mandatory evacuation is ordered by local government authorities at your scheduled destination which prevents you from traveling to or arriving at your scheduled destination.
• Your or your traveling companion’s primary residence or scheduled destination is made uninhabitable and remains uninhabitable during your trip by a natural disaster or burglary.  Friendly FYI that a hurricane is foreseeable on the date it becomes a named storm, therefore claims are only payable if a hurricane is not foreseeable prior to your effective date for trip cancellation.

Crime and financial defaults

•  A documented theft of your passports or visas specifically required for your trip. A police report must be provided.
• You or your traveling companion are the victim of a felonious assault within 10 days prior to the scheduled departure date.
• The financial insolvency or financial default of an entity that directly provides travel arrangements, including an air common carrier, cruise line, tour operator, or other travel entity that causes a complete cessation of travel services if the financial insolvency or financial default occurs more than 14 days following your effective date for your trip cancellation benefit.  Benefits will be paid due to financial insolvency or financial default of an airline only if no alternate transportation is available. If alternate transportation is available, benefits will be limited to the change fee charged to allow you to transfer to another airline in order to get to your intended destination.

Work and service obligations

• You or your traveling companion are subpoenaed, served with a court order, required to serve on a jury, or required to appear as a witness in a legal action, provided you or your traveling companion are not a party to the legal action except if you must appear in a law enforcement capacity.
• You or your traveling companion or family member are called to active military duty either to serve or to provide aid or relief in the event of a natural disaster.
• You or your traveling companion’s previously granted military leave is revoked or reassigned. Official written revocation or re-assignment by a supervisor or commanding officer of the appropriate branch of service will be required. The military leave for the dates of travel must have been approved prior to the effective date of trip cancellation coverage and the leave revoked or reassigned after the effective date of trip cancellation coverage.
• You or your traveling companion are involuntarily terminated or laid off from your job. The termination notice must occur at least 1 day after your trip cancellation effective date. You or your traveling companion must have been employed with the same employer for at least 1 continuous year. This does not include temporary or seasonal employment, independent contractors, freelancers or self-employed persons.

Terrorism and travel alerts

• You or your traveling companion are hijacked.
• A terrorist incident by a recognized terror organization occurs before your trip within 30 days of your scheduled departure date in a city listed on the scheduled itinerary of your trip, provided your travel supplier (if applicable) did not offer a substitute itinerary.
• A travel alert or travel warning for levels 4 and higher is issued for cities listed on your itinerary after your effective date for trip cancellation to a destination specifically listed on your itinerary. The travel alert or warning must occur within 30 days of the scheduled departure date.

When to cancel your trip

Don’t forget that you must report cancellations to the travel supplier – like your airline – within 72 hours of the event causing the need to cancel. If the event delays the reporting of the cancellation beyond 72 hours, you should report the event as soon as possible. At Faye, we do not cover increased amounts of unused, non-refundable prepaid payments or deposits that result from all other delays or reporting beyond 72 hours.

What’s the difference between covered reasons and foreseeable events?

Faye and most travel insurance providers do not cover expected or foreseeable events or problems. Simply put, if you’re purchasing travel protection and you’re already thinking that you might need to cancel for a specific reason, then that reason is probably a foreseeable event. If this is the case, you’re better off planning your trip when there isn’t a high likelihood of canceling. 

A common example of foreseeable events is a level 4 travel alert .  If you’re booking a vacation and you’re destination lands on the level 4: do not travel list from the U.S. State Department and you buy travel protection after it’s on the list, you won’t be covered. However, if you cover your trip prior to your destination being placed on the list then it would be a covered scenario as it is not foreseeable yet. 

Travel the Faye way

We hope we’ve managed to demystify what a covered reason for trip cancellation is! Have more questions? Contact our support team at [email protected] . 

Read more with Faye

Debunking the 5 most common travel insurance myths

The unique benefits of travel insurance you may not know about. Hint: it includes your dog

Expert tips on the right time to buy travel insurance

• Home     Policy Wording Explained     What is Cancellation?

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What is Cancellation?

Cancellation cover is one of the main reasons people take out travel insurance, alongside cover for medical expenses and personal possessions, as no one wants to be both disappointed and out of pocket if they are unable to go on their holiday.

In terms of travel insurance cancellation cover is there to protect you against financial loss should an unforeseen circumstance prevent you from going on your planned holiday or trip. Expenses can include, but are not limited to; loss of accommodation, pre-paid car hire, unused flights and pre-booked excursions.

What does Cancellation cover me for?

Although we don’t like to think about it, sometimes unexpected events happen and as a result we are forced to cancel our dream holiday. Should this happen your travel insurance policy will reimburse pre-paid, non-refundable costs.

The majority of travel insurance policies will provide cancellation cover for the following limited reasons;

• Death, injury or illness of you or a travelling companion
• Death, injury or illness of a close relative not travelling with you
• You or a travelling companion are called for Jury Service
• You or a travelling companion are made redundant

It is worth noting there are a few travel insurance policies that offer more extensive cover. This is usually termed as; ‘cancellation due to any cause beyond your reasonable control’.

Beware, most standard travel insurance policies will not provide cover for cancellation due to death, injury or illness of a non-travelling close relative if it is related to an existing medical condition. If this cover is important to you, it may be worth looking for a policy that will offer the cover, there are a few that do.

Do I need Cancellation cover in my travel insurance policy?

Yes. Cancellation is one of the main reasons people claim on a travel insurance policy and as no one can predict the future, when it comes to booking a holiday and purchasing travel insurance it’s better to be safe than sorry.

If you are the type of person that books last minute city breaks leaving in a day or two then you may not feel it is necessary to buy a travel insurance policy that includes cancellation. But, say something was to happen whilst you are away and you needed to come home early, you would need a policy with this cover included.

In addition, you may have spent weeks organising your dream family holiday to Disney World and now you’re considering whether or not you need to take out a policy with cancellation cover because it’s more expensive and there is no way you’re going to miss this trip – right?! Unfortunately, illness and injury are unavoidable no matter how careful we are – without the protection of cancellation cover you will be left out of pocket should you or a travelling companion fall ill and can no longer travel!

Beware, travel insurance should be purchased as soon as you have booked your holiday to ensure you are covered straight away should the worst happen – and this includes multi trip policies too!

Is Cancellation covered in my policy as standard?

Cancellation is generally covered as standard, however as the cancellation cover limit can vary between policies we advise you read your policy wording carefully to ensure you are covered for the full cost of your holiday.

For example, a policy may have adequate medical and personal possession cover but what if the cancellation cover limit is only half what you paid for your holiday? In this case, insurers may only pay up to the cancellation cover limit and also reduce the amount they will pay for other sections such as medical expenses and personal possessions by the same percentage (i.e. if the policy cover limit is 50% of the total trip cost, all other claims will be reduced by 50%).

Although policies that have higher cancellation cover tend to be a little more expensive, spending a few extra pounds now could save you from losing thousands later!

Be sure to check exclusions too as the majority of policies will not offer cover for cancellation due to a natural disaster or if the airline ceases trading. To ensure you are fully covered we recommend looking for a policy that will cover Force Majeure and Scheduled Airline Failure/End Supplier Failure.

When does cancellation cover start?

The start date for cancellation cover will depend on the type of policy you have purchased.

If you have brought a single trip policy or a long stay policy, the start date should be when you leave home to begin your holiday however cover for cancellation will begin as soon as the payment for the policy has been processed.

Multi-trip policies are a little different, they are designed to cover a 365-day period. The start date of the policy should be from when you require cancellation cover to begin and not the date that you travel. Generally speaking, the start date for a multi-trip policy should be within 31-days of you paying for the policy. It is worth noting that if you need to cancel your holiday before the policy start date, then no cover will be available.

How does Cancellation work when it comes to making a claim?

No one likes to submit a claim; the paperwork, insurance jargon and the tiresome waiting – not our idea of fun! But what if making a claim meant you could potentially book another holiday to replace the one you had to cancel? – now that’s more like it!

If your policy covers cancellation, your travel insurance company will assess a claim’s payment for any pre-paid expenses.

It is important to note that when making a claim for cancellation your travel insurance company will require a number of documents to assess the situation; this often includes but is not limited to, receipts and proof of purchase, doctor/consultant letters and any legal documents stating your requirement for Jury Service. We recommend you read your policy wording carefully beforehand to ensure you have everything needed to assist the claim process.

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Travel Insurance | Definition, Benefits, Considerations, Selection

What is travel insurance.

T ravel insurance is a type of policy designed to cover various risks and losses associated with traveling. It can provide financial protection for unforeseen events that may occur before or during a trip.

Travel insurance policies often cover a wide range of incidents, such as medical emergencies, trip cancellations, lost luggage, and more.

By purchasing travel insurance, individuals can have peace of mind knowing they are protected against potential financial setbacks while exploring new destinations.

Travel insurance is crucial for mitigating risks that can occur during a trip . It provides a safety net for travelers, ensuring that they have financial support when faced with unexpected situations.

Having travel insurance can also alleviate stress and anxiety associated with traveling, especially for those venturing to unfamiliar destinations or participating in high-risk activities.

In addition, it can help travelers avoid the burden of paying for costly medical treatments or losing non-refundable deposits due to unforeseen cancellations.

Benefits of Travel Insurance

Medical emergencies and evacuation.

One of the primary reasons to obtain travel insurance is to cover potential medical emergencies that may occur during a trip. Medical coverage can help pay for hospital bills, doctor visits, and even emergency evacuation if needed.

In some cases, travelers may require emergency transportation back to their home country for specialized treatment. Travel insurance can cover the cost of this evacuation, which can be extremely expensive if paid out-of-pocket.

Trip Cancellation, Interruption, and Delay

Trip cancellation, interruption, and delay coverage are essential components of travel insurance. These policies protect travelers from financial losses due to unforeseen events that may disrupt their travel plans.

Trip cancellation coverage reimburses travelers for non-refundable expenses if they need to cancel their trip before departure due to covered reasons.

Trip interruption coverage provides reimbursement for additional expenses incurred if a trip is cut short, while trip delay coverage compensates for expenses such as accommodations and meals if a traveler is delayed for a specified period.

Factors to Consider When Purchasing Travel Insurance

Duration and frequency of travel.

When choosing a travel insurance policy, it's essential to consider the length and frequency of your trips. Frequent travelers or those planning extended trips may benefit from purchasing an annual multi-trip policy, which covers multiple trips within a year.

Annual multi-trip policies can be more cost-effective than purchasing individual policies for each trip. However, they may have limitations regarding the maximum duration of each trip, so it's crucial to review the policy details carefully.

Destination and Activities

The destination and activities planned during a trip can significantly impact the type of travel insurance needed.

Travelers heading to remote or high-risk locations may require more comprehensive coverage, including medical evacuation and emergency assistance services.

Similarly, travelers participating in adventure sports or other potentially dangerous activities should ensure that their chosen policy covers these specific pursuits. Some policies may exclude certain activities or require additional coverage to be purchased.

How to Choose the Right Travel Insurance Policy

Comparing travel insurance providers.

Before purchasing travel insurance, it's crucial to compare different providers to find the best policy for your needs. This involves researching various companies, reviewing their coverage options, and evaluating their customer service and claims processes.

By comparing travel insurance providers, travelers can gain a better understanding of the policies available and make an informed decision about which policy is best suited to their individual needs and preferences.

Evaluating Coverage Options

When selecting a travel insurance policy, it's important to carefully review the coverage options available. Travelers should ensure that the policy provides adequate protection for their specific needs, such as medical coverage, trip cancellation, and baggage loss.

In addition, it's crucial to review the policy's limits, deductibles, and exclusions. These factors can significantly impact the level of protection provided by the policy.

Travelers should select a policy that offers sufficient coverage limits and reasonable deductibles, while also being mindful of any exclusions that may apply to their specific situation.

How to File a Travel Insurance Claim

Understanding the claims process.

Filing a travel insurance claim can be a daunting task, but understanding the process can make it less overwhelming. Familiarizing oneself with the required steps and documentation needed can help ensure a smoother experience when submitting a claim.

The first step in the claims process is to notify the insurance provider as soon as possible when an incident occurs. Timely communication is essential, as some policies have strict deadlines for submitting claims.

Gathering Necessary Documentation

When filing a travel insurance claim, it's crucial to gather all necessary documentation to support the claim.

This can include receipts, invoices, medical records, and any other relevant paperwork that demonstrates the expenses incurred as a result of the covered event.

Travelers should also provide a detailed written account of the incident, including dates, locations, and any other pertinent information.

By providing thorough documentation, travelers can help expedite the claims process and increase their chances of receiving a favorable outcome.

Travel Insurance and COVID-19

The COVID-19 pandemic has significantly impacted the travel insurance industry, prompting changes in coverage and policy offerings.

As travel restrictions and health concerns continue to evolve, insurance providers have adapted their policies to address the unique challenges presented by the pandemic.

Many travel insurance providers now offer policies that include coverage for COVID-19 related expenses, such as medical treatment, quarantine, and trip cancellations due to the virus.

However, it's essential to carefully review each policy's specific coverage and exclusions related to COVID-19.

In conclusion, travel insurance is an essential component of any travel plan, providing financial protection and peace of mind in the face of unexpected events.

By carefully considering factors such as duration, destination, and activities, travelers can select the best policy for their needs.

Understanding the claims process and staying informed about COVID-19 related coverage can further enhance the benefits of travel insurance, ensuring that travelers are well-prepared for any challenges that may arise during their journeys.

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Why the federal government is paying upfront to fix the Baltimore bridge

The federal government stepping in to pay to rebuild the bridge doesn’t necessarily mean taxpayers will cover the entire bill.

After President Joe Biden said the federal government would pay to replace Baltimore’s Francis Scott Key Bridge, a project estimated to cost from  $400 million  to  over $1 billion , some social media users questioned why the company that owned the ship isn’t footing the bill.

Biden, in  March 26 remarks  after the accident, said the federal government “will pay for the entire cost of reconstructing that bridge,” and he expected congressional support for that effort.

On social media, users expressed outrage.

“That ship was commissioned by a Danish company. It was operating under a Singapore flag … President Biden thinks the American taxpayers should foot the bill to clean up the mess and rebuild the bridge. I think there’s a foreign company that owes us a bridge!” read  three   Facebook   posts  that shared the same graphic.

“Why are WE responsible for paying for this!! Make it make sense!!” another  Facebook post  said.

Former House Speaker Newt Gingrich, R-Ga., criticized Biden, writing  in an X post , “Why add a billion dollars to US debt when the big insurance companies exist for precisely this purpose?”

The ship that struck the bridge was owned by Singapore-based company Grace Ocean Private Ltd. It was managed by Singapore-based ship management company Synergy Marine Group, and chartered by Danish shipping company Maersk.

Grace Ocean Private Ltd. and Synergy Marine Group filed a court petition April 1  seeking to cap their liability  at about $43.6 million.

The federal Department of Transportation on March 28  announced $60 million  in “quick release” Emergency Relief funds for the Maryland Department of Transportation Department to begin rebuilding the bridge, describing it as an “initial down payment of funds.”

Getting the bridge repaired and the Port of Baltimore open to ship traffic is an economic imperative for Maryland and for the U.S.,  Maryland  and federal  officials  said.

The bridge carried more than 30,000 vehicles a day, state officials said. The Port of Baltimore in 2021 was the 17th largest in the U.S. in terms of annual total tonnage of cargo, U.S. Department of Transportation  data shows.

Maryland’s Democratic governor, Wes Moore,  said  March 31 on “Fox News Sunday” that the bridge collapse isn’t affecting Maryland’s economy alone, but also states across the country.

The support Baltimore has received “isn’t because anyone is trying to do Maryland a favor,” Moore said. “It’s because the national economy relies on the Port of Baltimore being up and running,”

Where will the money come from and will feds foot the entire bill?

The federal government stepping in to pay to rebuild the bridge doesn’t necessarily mean taxpayers will cover the entire bill.

When reporters asked Biden March 26 whether the company that owned the ship should be held responsible, Biden  said , “That could be, but we’re not going to wait if that happened. We’re going to pay for it to get the bridge rebuilt and open.”

Transportation Secretary Pete Buttigieg said at a  March 27 news briefing  that “any private party that is found responsible and liable will be held accountable” for the bridge accident.

Analysts  say  insured losses including for bridge repair and business interruption could amount to up to $4 billion. But lawsuits in similar disasters have taken years to settle.

Peter Knudson, a National Transportation Safety Board spokesperson, said its investigation is expected to last one to two years.

Sen. Chris Van Hollen, D-Md.,  said  on ABC’s “This Week with George Stephanopoulos” that “The federal government will pay 90% of the costs,” and he plans to introduce legislation to cover the other 10%.

Treasury Secretary Janet Yellen in a  March 27 MSNBC interview,  said money from the 2021 Bipartisan Infrastructure Law could help pay some of the costs, but said she expected insurance to cover those costs partly.

Buttigieg  said  March 31 on CBS’ “Face the Nation” that more than the initial $60 million in emergency released funding will come, but “it is possible we may need to turn to Congress to supplement that fund. That has happened in the past.”

Although some Republicans in Congress have  expressed opposition  to paying for the repairs, Senate Minority Leader Mitch McConnell, R-Ky.,  said  in an April 1 radio interview that the federal government will pay “the lion’s share” of the cost to replace the bridge.

Buttigieg pointed to bipartisan support for a $250 million reconstruction package following 2007 collapse of the Interstate N35 in Minnesota.

The bridge’s  August 2007  collapse near downtown Minneapolis took down 111 vehicles, killing 13 people and injuring 145. The NTSB concluded that the probable cause was “inadequate load capacity, due to a design error” of some of the bridge’s structures.

With the state  estimated to lose  about $60 million in economic output in 2007 and 2008 because of the bridge’s absence, Congress three days after the bridge’s collapse authorized the reconstruction funding. Two days after that, former President George W. Bush signed it into law. The bridge was completed in 13 months.

URS Corp., the engineering company tasked to evaluate the bridge before it collapsed, agreed to pay $52.4 million to the tragedy’s victims.

Federal government has paid up front for similar disasters

Steve Ellis, president of the Taxpayers for Common Sense, an independent group that analyzes federal spending, said the federal government often intervenes after disasters to pay for the immediate response.

“In this case, where there are other insured actors, like the shipping line, the federal government should go after them for reimbursement and penalties,” Ellis said.

Andy Winkler, director of the Bipartisan Policy Center’s infrastructure project, said the Biden administration’s quick offer of assistance in the Baltimore bridge collapse does not preclude the federal government from recouping costs should a private sector party be found responsible.”

Here are some examples of the federal government paying up front and seeking reimbursement later:

Deepwater Horizon and Exxon Valdez oil spills:  Ellis and Winkler each pointed to the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, and Ellis also noted the 1989 Exxon Valdez oil spill in Alaska as examples of the federal government contributing to upfront costs and recovering moneymore through settlements with the companies responsible. Those settlements took six years to reach in the Deepwater spill and two in the Exxon spill.

The Deepwater spill, triggered by an oil rig explosion that killed 11 people, was the largest U.S. marine oil spill ever,  releasing about 130 million gallons of oil  into the sea and soiling five states coastlines. The federal government reached a $20.8 billion settlement with BP, the largest environmental settlement in U.S. history, that was  approved  in 2016 by a federal judge.

“The federal government provided assistance, including funding to support cleanup efforts, all while aggressively pursuing compensation for all damage,” Winkler said.

Before Deepwater Horizon, the  1989 Exxon Valdez  oil spill had been the worst in U.S. history. An Exxon oil tanker struck a reef in Prince William Sound, Alaska, spilling 11 million gallons of crude oil into the water. Exxon agreed to pay $1 billion in fines and damages, the  Enviromental Protection Agency said in 1991 . Overall,  Exxon said  it has paid $4.3 billion after the accident in compensatory and cleanup payments, settlements and fines.

East Palestine train derailment:  In 2023, after a train derailed in East Palestine, Ohio, the state led the initial emergency operation with federal and local support.

Days later, the EPA  ordered  its operator, Norfolk Southern, to reimburse the agency for cleanup.

Norfolk Southern claimed that companies responsible for the destroyed tank cars and spilled chemicals should share cleanup costs, which it said amounted to more than $1.1 billion. But in  March , a federal judge ruled that solely Norfolk Southern should fund the cleanup.

The  $1.1 billion figure  reflects any costs charged to Norfolk because of the derailment, as well as the more than $104 million paid directly to residents and the East Palestine community, Norfolk spokesperson Connor Spielmaker told PolitiFact.

The EPA told PolitiFact in an April 1 email it will send Norfolk Southern a bill for all of its personnel, time and resources spent.

Washington highway bridge collapse:  In Washington state in May 2013, the Interstate 5 Skagit River Bridge in Mount Vernon, about halfway between Seattle and the Canadian border, collapsed after a wide-load-bearing 18-wheeler crashed into the bridge. A month later, the U.S. Department of Transportation’s Federal Highway Administration released $15.6 million from emergency funds to pay for the repairs, but required the state to seek reimbursement,  The Seattle Times reported .

In 2019, the Washington Supreme Court ruled that Mullen Trucking and Motorways Trucking, the  two companies responsible for the crash, were responsible for paying $17 million to pay the repair costs instead of taxpayers,  The Seattle Times said .

PolitiFact Senior Correspondent Amy Sherman and Researcher Caryn Baird contributed to this story.

This fact check was originally published by PolitiFact , which is part of the Poynter Institute. See the sources for this fact check here .

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