YOU ASK:

What does cancellation cover actually cover on travel insurance?

WE ANSWER:

The Trip Cancellation Benefit provided by travel insurance pays in the event that you have to cancel your planned trip. It pays for the portions of the trip that are non-refundable. This includes non-refundable airline tickets, cruise ship deposits and hotel reservation deposits.

Usually, there are just specified reasons when the travel insurance provider will pay for trip cancellation.

  • First, when a deposit or cruise payment has been given and you can't get a refund of your payment because the carrier has gone bust.
  • Second, if the weather condition prevents you from traveling.
  • Third, if there is an emergency (such as when you or a family member gets sick before the trip).
  • Other travel insurance companies make additional provisions, such as trip cancellation due to your termination or resignation from your job, terrorist activity (like hijacking of the plane), airline strikes, natural disasters that occur close to your residence and jury duty.
  • Sometimes, you can also cancel because of terrorist activities.

Trip cancellation coverage varies depending on the provider, so it is best to check the terms and conditions of the travel insurance policy. Some travel insurance providers may also exclude airlines, tour operators and carriers that are not on their list of accepted carriers. The insurance companies may also exclude reasons related to pre-existing conditions.

However, if you still want additional protection regarding trip cancellation, you could also purchase "trip cancellation for any reason". Under this provision, you can cancel for virtually any reason - some problems at the office that needs your immediate attention, you weren't able to get your passport or visa on time or because you have simply changed your mind.

Some trip cancellation insurance may also pay for related expenses due to your need to cut your trip short because you need to return back home to attend to an emergency. This may include penalties incurred, the cost of the ticket to return home (which, when bought at the last minute can be quite expensive) and other expenses.

Trip cancellation can also cover for unexpected trip delays, where you would have to find alternative accommodations and spend for your meals.

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