Trip cancellation insurance protects you from financial losses that might occur if your trip gets cancelled due to an unforeseen event.

For example, say you’ve already booked your trip to Hawaii. Your booking includes your flight, hotel rooms and rental car reservation. However, your spouse gets sick a day before you leave for your trip and the doctor advises them not to risk their health by traveling. In this case, canceling the trip might be costly. However, with trip cancellation coverage, you’re protected against financial losses even if unforeseen circumstances force you to cancel your trip.

Trip cancellation insurance will typically cover you for the following situations:

  • You or your spouse or any other person dependent on you falls sick
  • Death of a traveling companion or family member
  • Damage to your house in a natural disaster, such as a flood, fire or earthquake
  • Complete cessation of travel services due to strike
  • Terror strike at the destination you have planned your trip
  • You or your companion is affected by a termination or a layoff
  • Inclement weather
  • Your spouse becomes pregnant and is not allowed to travel during pregnancy
  • You or your traveling companion is quarantined
  • You or your traveling companion is summoned by the court to appear

There are some other plans that may provide optional coverage on flexible terms, which are known as Covered For Any Reason (CFAR) plans. This option will allow you to cancel your trip for any reason, such as:

  • You feel unsafe to travel due to COVID-19 or any such reason
  • You have last-minute important work in your office, which needs to be done immediately
  • Your child or grandchild wants you to support them by being with them for their performance or sporting event

Who Needs Trip Cancellation Insurance?

It’s wise to get trip cancellation coverage for the following reasons:

  • Expensive Trips: If you’re going on an expensive trip, it’s always a wise decision to insure yourself in case you need to cancel the trip. This will help you protect yourself against the financial loss that you might face due to cancellation of the trip.
  • Travel plans made in advance: If you’ve booked your travel tickets far in advance of your departure date, the chances of an unforeseen incident are high. In such a case, it’s advisable to get trip cancellation coverage.
  • Cruises: It’s quite difficult to cancel a cruise booking. Trip cancellation coverage would give you the peace of mind that you’re covered against unforeseen incidents.
  • Traveling with kids: Kids can fall sick easily. If your child gets sick at the last minute and you’re forced to cancel the trip, insuring yourself against last moment cancellation protects your investment in the trip.

Important Things to Know:

  • Most of the plans are available for U.S. or Canadian residents
  • The insurance policy covers you for 30 days, beyond which an additional per-day fee is charged
  • Pre-existing condition coverage is available if you buy trip coverage within a restricted time limit mentioned in the plan
  • Basic trip coverage generally includes trip cancellation, trip delay, trip interruption, baggage loss/delay, emergency medical coverage
  • The pricing and cost of a trip insurance policy depends on the trip cost and age of the traveler

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