Travel Insurance

What Trip Cancellation Insurance Covers & What It Doesn’t

What Trip Cancellation Insurance Covers & What It Doesn’t

So, let’s face it: When it comes to traveling, nobody’s lucky 100% of the time. When we travel, we have to grapple with things like canceled flights, missed connections, baggage loss and sometimes we have to cancel our trips before we even get off the ground, literally.

Fortunately trip insurance has built-in cancellation protections that help soften the blow if you have to put the kibosh on your trip before your departure date.

Let’s take a look at what trip cancellation insurance covers, as well as what it doesn’t. 

What Does Trip Cancellation Insurance Cover?

Here’s a quick look at the types of situations trip cancellation may cover as well as what it likely won’t cover. If you’re interested in learning more about what trip insurance does and doesn’t cover, check out this post

Infographic titled "What Trip Cancellation Covers". The graphic describes what non-refundable costs trip cancellation insurance covers.

What Is a Covered Reason for Trip Cancellation?

Coverage for trip cancellation will vary from plan to plan, however there are a few typical instances in which trip cancellation may be covered under a trip insurance plan. It’s best to review your trip insurance policy’s description of coverage to understand exactly what instances may be covered under your plan.

Here are a few examples of what may be a covered reason for trip cancellation:

  • Documented theft of passport/visa
  • Sickness, injury, or death of insured or family member, child caregiver, or travel companion
  • Job loss
  • Documented traffic accident
  • Inclement weather
  • Natural disasters
  • Terrorist incident
  • Jury duty
  • Travel alert or travel warning for levels four or higher

Does Trip Insurance Cover Cancellations Due to the Illness of the Policyholder or Travel Companions? 

Yes! The good news for trip insurance policyholders is that most plans will reimburse 100% of prepaid travel expenses in the event that the policyholder, an immediate family member, or their travel companion is too ill to travel.

The illness must prevent you from being able to travel and will need to be documented and a physician will have to order for you not to travel.

Does Trip Insurance Cover Weather Cancellations? 

Yes! In general, trip insurance will cover trip cancellations caused by inclement weather either in the policyholder’s hometown or at their destinations. However, the situation must meet certain qualifications.

For example, the weather event has to render either the policyholder’s home or their hotel in their destination country uninhabitable, or shut down an airport for at least 24 consecutive hours. If the specified conditions are met, basic trip insurance will reimburse the policyholder for the entirety of prepaid travel expenses.

Illustration with a traveler holding a selfie stick in Greece on one side and scene of a tree being uprooted next to a house due to a hurricane on the other.

Does Trip Insurance Cover Cancelled Flights?

It depends. If the flight is canceled for more than 24 hours due to inclement weather, basic trip insurance may reimburse the policyholder for all of the prepaid travel expenses. However, if the cancellation is airline-caused, trip insurance would only offer coverage if the airline failed to provide ANY form of compensation to the policyholder.

If airline issues lead to flight cancellation, it’s the airline’s responsibility to reimburse the traveler.  However, trip insurance can help cover things related to an airline-caused cancellation like expenses for an overnight hotel stay, or a hotel-to-airport shuttle.

Illustration showing a snowboarding on a mountain on one side and a man looking at flight delays board in an airport to see that his flight is cancelled.

Does Trip Insurance Cover Cancellations Due to Job Termination? 

It depends. If the policyholder (or their travel companion) loses their job through no fault of their own, basic trip insurance would cover the trip cancellation if certain qualifications are met. The termination has to have occurred after the trip insurance policy effective date and before departure.

Additionally, the policyholder (or their travel companion) must have been with the company for at least a year before being let go.

Illustration with a scene of a cruise ship in Antartica on one side and a woman carrying a box of her belongings out of her office after being laid off on the other.

Does Trip Insurance Cover Covid-related Cancellations?

Yes, under certain conditions trip insurance can cover Covid-related cancellations. If you contract Covid and are unable to go on your trip as a result, and your Covid is documented by an attending physician as an illness preventing you from travel, it may be covered under a trip cancellation benefit.

However, if you fall ill with Covid and are not hospitalized, not ordered to quarantine, or have no documentation from an attending physician regarding your diagnosis and travel, you may not be covered unless you add the Cancel For Any Reason benefit to your policy. Cancel For Any Reason travel insurance, or CFAR, insurance allows travelers to cancel their trip plans before their departure date and still recoup certain prepaid travel expenses like hotel deposits and nonrefundable flights.

There are a few other reasons basic trip insurance may cover a canceled trip. For example, a death of a loved one, a birth of a new family member, a bad traffic accident on the way to the airport, the policyholder and their travel companion legally separate or start divorce proceedings after the policy effective date.  

Illustration of a tourist holding a selfie stick in Barcelona on one side while the other side shows a traveller wearing a mask and luggage with an X through it. The travelled cancelled his trip due to Covid

While trip insurance can’t save anyone from having to cancel their trip plans, it can make that reality a little less harsh. And fortunately for us travelers, the beauty and wonder of the world isn’t going anywhere. It will be there waiting for us, we’re finally ready to put our travels back on our calendars.  

Ready to Protect Your Trip Investment? VisitorsCoverage Has a Trip Insurance Plan For You

Worried about losing money if you have to cancel your trip? You’re definitely not alone. At VisitorsCoverage, we have plenty of top-rated trip insurance plans to choose from.

Whether you’re ready to buy or just have a few questions, our Customer Success Team of licensed travel insurance experts is ready to help.