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Am I covered if I need to cancel a trip?

While no one wants to cancel a trip, sometimes it’s necessary. But what if you’ve already booked flights and hotels – are you out of all that money? This will depend on the answers to these three questions: 

  • Did you have trip cancellation travel insurance?  
  • Are your bookings refundable?  
  • What is the reason you’re cancelling?  

We’ll explain why these factors matter and how they impact your ability to get refunded if you must cancel a trip. 

Trip Cancellation: Before You Leave

Trip cancellation travel insurance is designed to help you recoup your costs if you cancel a trip before you leave. Keep in mind that not all reasons for cancellation are covered – we’ll discuss that more below. 

Expenses that can be covered include airfare, accommodation, transportation, cancellation fees and more – any non-refundable, unused prepaid travel arrangements.  

Refundable and Non-Refundable Bookings 

The first step will be to see if you can get any type of refund directly from where you booked. Your eligibility will depend on the vendor’s cancellation policy and the type of ticket you purchased.  

For example, many airlines offer a basic fare that is nonrefundable. However, if you purchase a higher tier, you may be able to cancel and get a full refund.  

In many cases, you may be able to cancel but will not be refunded the full amount. The vendor may keep an administration fee, charge a cancellation fee, or even keep an amount of the full cost. Trip cancellation coverage can help cover these expenses.  

Reason for Cancelling 

A few of the scenarios that can be covered by trip cancellation travel insurance include: 

  • A personal medical or dental emergency 
  • A death or major illness in your family 
  • The person you are travelling with has a change of plans due to a personal or family emergency 
  • Your destination has extreme weather such as a hurricane or flood 
  • Your flight or tour is cancelled or delayed 
  • Your visa to your destination is denied 
  • Your home is damaged, or business is inoperable due to an unforeseen event 
  • You lost the financial resources needed to take the trip (i.e., you lost your job) 
  • You contract COVID-19 and need to quarantine or self-isolate 

It’s important to note that not every circumstance is covered by a trip cancellation travel insurance policy. Some insurance companies may not offer coverage for COVID-19 or offer it only as an add-on. You may also be able to purchase ‘Cancel for Any Reason’ coverage – a much more expensive but comprehensive option. 

Trip Interruption: During the Trip

When your trip is cut short part-way through this is trip interruption. The reasons are largely the same as for a “cancellation” but the timing is different.

However, your insurance will not cover a trip interruption if you could have been reasonably informed that you would possibly have to interrupt your trip. For example:

  • You cancel your family’s Hawaii vacation because there’s a hurricane. Was it a freak storm with unlucky timing OR is this Hawaii’s hurricane season?
  • Sadly your grandpa passes away. Was it an accident or unexpected illness OR was his health already in decline when you bought your plane ticket?
  • You have a personal medical emergency or don’t have time to get the shots you need for travel. Did you remember to consult your doctor before you made your travel plans OR did you forget to plan ahead?
  • Your flight is delayed so you cancel the trip. However the flight takes off after an hour’s delay. Could you have waited instead of cancelling out of frustration?

Ensure you know what qualifies for reimbursement and help getting home when it comes to trip interruption.

Travel Advisories 

Many travel insurance companies use official government websites like the Government of Canada’s Travel Advice and Advisories website as their basis of “reasonably informed.” If a recommendation or precaution is listed there before you book your vacation and you cancel your trip on account of one of those listed items, you will not receive compensation. However, if it is not listed or is added after you book your trip, you would be covered. 

For example, let’s say in March you book a trip to Colombia for September. In July you decide to cancel the trip because you’re worried about a COVID-19 surge there. You would not receive compensation from your trip cancellation insurance because the Canadian Government had warned of the virus before you booked your trip. However, let’s say you cancelled your trip due to a new illness that you were concerned about. The government added a travel advisory after you booked your trip, so you would be covered as this illness was not listed at the time that you booked. 

Cancelling a Trip 

Trip cancellation travel insurance can cover your non-refundable expenses if you’re unexpectedly forced to cancel your trip or vacation, so long as the reason is covered by your policy. Make sure you’ve purchased this coverage before your trip and preferably before you’ve made any bookings.  

When you do cancel a trip, follow these tips: 

  • Contact your trip cancellation travel insurance company or your broker to start a claim. 
  • Fill out the claims form and any other paperwork your travel insurance company sends to you. 
  • Start the cancellation process as soon as possible to maximize your chances of getting refunds.  
  • Gather any relevant documentation for the reason you’re cancelling. 
  • Get a copy of the vendor’s cancellation and refund policies. (you can find these on their website or request they be emailed or mailed to you.) 
  • Keep all receipts and communications.  
  • Provide information of any other policies that may apply such as credit card or employee benefit travel insurance.  

Speak to your broker for more details on trip cancellation insurance. This coverage can be very valuable – especially when cancellations are so common due to the pandemic. However, not all scenarios are covered or may be more expensive to insure. That’s why speaking to a broker is a good place to start. They’ll find you the best coverage for your budget and help you understand your trip cancellation insurance.