How Does Trip Cancellation Insurance Work?

We all need to break from all the hustle and bustle of life. Each one of us plans on taking at least one trip every year, away from our homes, doing something we don’t generally do – take a hike, lay on a hammock with a book, or go swimming to let some steam off. Based on our preferences, we book flight/train tickets and make hotel reservations in advance without taking uncertainties into consideration. But, what if when it’s finally time to board that train/flight, something happens, and you cannot make it? There will be a deep regret. Not only will it shatter your travel plans, but it will also drain all your money down the gutter. You won’t receive any refund if you cancel your trip right when you have to leave. However, you can escape such unnecessary losses by opting for an international travel insurance plan with a trip cancellation cover. So, let us take a deep dive into the trip cancellation cover and understand why it is a lucrative financial tool.

What does Trip Cancellation Insurance Cover?

A trip cancellation cover offers a refund on your pre-paid, non-refundable, and deferred expenses related to the trip. In case you have made all the bookings but cannot travel due to sickness, illness, or death of the insured, travel buddy, or a family member, you will be eligible for an insurance claim. Some insurers offer Trip Cancellation Insurance as a standalone plan, whereas others offer it as an add-on cover.

What is Trip Cancellation Insurance?

Trip cancellation insurance covers your expenses if your trip is canceled unexpectedly. It reimburses the prepaid, non-refundable, and forfeited costs if unforeseen circumstances beyond your control prevent you from traveling. Typical events covered include illness, injury, or death of the insured, their travel companion, or an immediate family member. Usually, trip cancellation insurance is offered as an add-on to a travel insurance policy, but some providers also offer it as a standalone plan

How does Trip Cancellation Insurance work?

Trip cancellation insurance provides coverage for non-refundable expenses like flight tickets and hotel bookings when your trip is unexpectedly canceled for covered reasons. Follow these steps to understand its process:

Step 1: Purchase a Policy

Start by buying a trip cancellation insurance policy, either as part of your travel insurance plan or separately.

Step 2: Know Covered Reasons

Check your policy to understand the covered cancellation reasons, such as illness, injury, or the death of the insured or an immediate family member.

Step 3: File a Claim with Documents

If your trip is canceled for a valid reason, file a claim by submitting required documents, such as medical reports, death certificates, or FIRs, to support your case.

Step 4: Receive Reimbursement

Once your claim is approved after verification, your insurance provider will reimburse the eligible trip cancellation expenses. This ensures financial protection against unforeseen trip cancellations. Read More: What Is The Role Of Medical History In Travel Insurance?

Inclusions Under Trip Cancellation Insurance

Inclusions of a Trip Cancellation Insurance Plan can differ from insurer to insurer. However, here’s what is covered in travel insurance with trip cancellation cover:

1. Death of an immediate family member
2. Damage to your place of residence
3. Serious illness or injury (applicable for you as well as your family)
4. Natural disaster at the travel destination
5. Terrorist attack at the travel destination
6. Changes in the dates of your paid leave at work
7. Having to reappear for an exam
8. ID or travel ticket theft
9. New job or loss of job
10. Denied tourist visa

* Standard T&C Apply Note: Cancellation insurance coverage is applicable as long as the reason is listed in the policy and uncertainties occur after you purchase insurance. The reason behind the trip cancellation must be unintentional and unforeseen. Read More: Why Do You Need Insurance Even When Traveling Within Your Country?

Exclusions under Trip Cancellation Insurance

Here are a few exclusions under the Trip Cancellation Insurance Cover:

1. Pregnancy and pregnancy-related issues
2. Addiction to drugs or alcohol
3. Nervous system diseases, depression, and anxiousness
4. Mistakes committed by the transport service provider
5. Any riots or labour disputes that existed when you bought the insurance cover
6. Cosmetic procedures undergone for a cause other than an accident
7. Flying even though the doctor has recommended against it due to a medical condition
8. Any rules enacted or published by a public body

Conclusion

Trip Cancellation Insurance comes in handy during multiple situations. However, ensure that you buy this insurance well in advance, so you can successfully claim losses. Do not forget to make a comparison of travel insurance plans offered online. Check out the travel insurance premium calculator to avail the best plan at a feasible rate. Moreover, read through the policy document before you opt for a travel insurance plan or a trip cancellation cover.

FAQs

Q. Does travel insurance cover trip cancellation?

Yes, travel insurance typically covers trip cancellations due to unforeseen events like illness, injury, or natural disasters. However, coverage varies by policy, so it’s important to review the terms for specific inclusions and exclusions.

Q. Should I buy trip cancellation insurance?

If your trip involves significant expenses like flights, accommodations, or tours, trip cancellation insurance is advisable. It provides financial protection in case unforeseen events force you to cancel or delay your plans.

Q. How does travel insurance work for trip cancellation?

Travel insurance reimburses non-refundable expenses if you cancel your trip due to covered reasons, such as medical emergencies or severe weather. You must file a claim with necessary documentation to receive compensation.

Q. Does travel insurance cover Cancelled trips?

Yes, travel insurance can cover canceled trips if the reason aligns with the policy’s covered events, such as illness, death of a family member, or natural disasters. Voluntary cancellations are usually not covered.

Q. How soon should I purchase trip cancellation insurance after booking my trip?

It’s best to purchase trip cancellation insurance immediately after booking your trip. Many policies require coverage to be bought within a certain period, such as 14–21 days, to cover pre-existing conditions.

Q. Is trip cancellation insurance included in all travel insurance policies?

No, trip cancellation insurance is not included in all travel insurance policies. It’s often an optional add-on or part of comprehensive plans. Always confirm its inclusion when purchasing a travel insurance policy. * Standard T&C Apply Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.