Travel Insurance Articles

Trip Cancellation Insurance

Trip Cancellation Insurance - What Does it Cover

Trip cancellation insurance is a type of travel insurance where the insured gets the reimbursement for the financial losses they may acquire when forced to cancel their trip due to an unexpected situation. When we say "unexpected situation", it does not include necessary reimbursements for the reason that you may have decided not to continue the trip.

Trip cancellation insurance coverage has several aspects to consider.

Trip cancellation due to death, injury, and illness are three of the most common causes most trip cancellation insurance companies cover. With this coverage, the person insured along with one or more person traveling with him/her are insured for reimbursements. It gives you the non-refundable amount of the trip when death of immediate family members living at your home occurs. Other policies also include other relatives, business partners, and the family members of your traveling companion. However, if the cause of death is due to the pre-existing condition, a cancelled trip is not qualified for reimbursement.

Personal emergencies are also qualified to trip cancellation insurance claims. Missing the flight due to unexpected situations such as vehicular accident is qualified for the claim. When you decided to cancel your trip if the government summons you or if you get food-poisoned and have to be brought to treatment among other reasons, filing a claim may also be legitimate.

When your airline provider filed for bankruptcy after you have bought the trip cancellation insurance, you have the right to get your claim. However, many trip cancellation insurance providers only cover bankruptcy so in case the airline fails due to other reasons, you cannot run after your reimbursements for it is clearly said in the policy that the company will only cover "bankruptcy".

Another point to note is the travel agency failure. Since many trip cancellation insurance providers do not honor claims for travel agency failure, you would not get even a small amount. Nonetheless, if you get your trip cancellation insurance from your travel agency, you are covered if the charter operator, airline or tour operator fail but would not get coverage if the agency fails. Similarly, if you get your insurance from a tour operator, you won't get reimbursement if the operator fails.

You are eligible for a claim if in case disaster strikes at your place and the trip is interrupted or requires cancellation. These may be typhoon, earthquakes, flood, or even when your house caught fire and other unavoidable calamities. Such situations are included in the coverage of most trip cancellation insurance policies.

If in case your destination encounters unexpected calamities such as earthquakes, flood, or fire, and would require trip cancellation, you can have your rightful claim. Civil unrest and terrorism could also be the reasons for a cancelled trip. If in case your destination has communicable disease and your flight is cancelled, you are also entitled to a claim.

Trip cancellation insurance costs less than what you may expect. On the average, the insurance would charge 5-7% of the total worth of the protection. For instance, you buy a policy worth $10,000 you would only pay $500-$700. This is a small price compared to what it may cost you if you did not acquire trip cancellation insurance.

Trip cancellation insurance provides protection to everyone insured and does not intend to ask for money that you cannot use once the policy is fulfilled. Trip cancellation insurance keeps your money secured, giving you the right to claim it in case something "unavoidable" happens before and even during the trip with relevant reasons.