Vacation Cancellation Insurance covers the costs of the unexpected and you need to cancel your vacation. For example, you may get sick, have an accident that prevents you from traveling, or there may be sudden bereavement in the family.
Policies can also pay if you are divorced or unemployed before your trip.
Cancellation insurance generally covers the cost of your vacation if canceled or for any of the reasons listed in your policy. It is an essential part of your travel insurance and can save your life if you have no choice but to cancel your trip.
Although cancellation coverage is normally included in all travel insurance policies, it is essential to check the terms and conditions of your plan. Coverage amount and terms may vary by policy and provider. Always check the wording of your plan carefully so you know exactly what circumstances are covered.
Buy when you book!
Cancellation coverage provides valuable protection in the lead-up to your trip departure, so it’s important to purchase your policy as soon as you book or incur financial expenses.
The cancellation section of your policy usually also includes “reduction” coverage. This is when you must cut your trip short, either for the same reasons that could lead you to cancel, or for a problem beyond your control at your destination, such as your accommodation is no longer available. .
What about cancellation coverage and Covid-19?
Many providers had limited or adjusted their vacation cancellation coverage on policies purchased after March 11, 2020, when Covid-19 was officially documented as a pandemic. Now, Covid-19-related trip cancellation requests are likely to be omitted from most insurance plans, as the virus is considered a “known event” that travelers will be aware of.
Likewise, if you choose to travel overseas to a destination where the Foreign, Commonwealth and Development Office (FCO) advises against non-essential travel upon departure, your travel insurance plan will be invalid and any complaint will be rejected. .
What does holiday cancellation insurance cover?
Vacation cancellation insurance plans typically cover the cost of pre-booked flights, transportation, accommodation, and any other agreed-upon costs that you cannot recover due to a last minute change in plans.
It can also cover activities and excursions that you have already paid for or that you have to pay because you have already booked them. However, there may be an upper limit per visit on the amount your provider will cover.
To receive payment, the circumstances of the cancellation must be out of your control. These conditions generally include events such as:
Fire, flood or burglary at your home shortly before your departure
Grieving a loved one
Accident or illness
The vacation destination becomes dangerous.
According to the policy, you may also be covered if you or someone you are traveling with becomes pregnant after the plan has been purchased, or if your doctor recommends that you not travel because of pregnancy complications.
If you work in the armed forces, you may also be covered if you are asked to return to duty before the end of your trip.
If your claim is successful, you will receive money to compensate for your loss, up to the financial limit you specify when you purchase your policy. The higher the coverage requested, the more expensive your insurance will be.
What is not covered?
You will not receive payment for transportation, accommodation or activity costs if you need to cancel them due to:
injury caused while under the influence of alcohol or over-the-counter medications
your airline cancels your flights. This is because the airline will be the one to compensate you
you’ve changed your mind about your vacation. This is called “reluctance to travel” and it is not something you can insure against.
What is the complaints process?
You can cancel your trip and make a claim at any time prior to your departure. As soon as you realize you need to cancel your trip, contact your insurer or check their website for details on how to make a claim.
Remember that you will need to provide evidence to support your claim. Evidence may include, but is not limited to:
unused tickets and tour booking receipts
You can also request a “discount” if you need to shorten your trip at any time. Discount coverage applies when you have already left for your vacation and need to leave before you plan.
In most cases, you can claim for the same reasons as cancellation coverage. However, with discount coverage, your claim is based on the days you haven’t used up rather than your entire vacation.
What if your airline cancels your flights?
If your flight is delayed for more than three hours or canceled, your airline should cover the costs. If you don’t know how to make a claim, check your airline’s website or call them.
Your travel insurance may cover the costs you incur as a result of a cancellation, up to a certain amount. Your policy documents will have details.