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No one plans to cancel their trip, but sometimes life happens. You might have been planning a trip for months, only to have a change of plans due to an illness, injury, or some other calamity. Travelling is expensive enough, and the last thing you want to do is lose your deposits or spend thousands of dollars booking a last-minute flight home.
Fortunately, trip cancellation and interruption insurance can protect you in these situations. It reimburses you for your expenses or pays for new flights so you can get home.
You can buy a stand-alone trip cancellation policy from an independent insurer, but many people choose to rely on the trip cancelation policy that their credit cards offer.
What is Trip Cancellation Insurance?
Trip cancellation insurance reimburses the cost of your trip if you have to cancel at the last minute or covers the cost of rebooking flights if you have to interrupt your trip and return home.
There are many travel rewards credit cards with trip cancellation insurance as a perk. Generally, these policies have a limit stated in the fine print of your credit card agreement. It can be as little as $500 or as much as $10,000, depending on the card you use. Most cards tend to offer coverage of around $1,500 to $5,000. These funds can be used to cover rebooking flights, hotels, or other travel costs.
Depending on the card, this coverage might only take effect in certain conditions. For example, many plans cover your trip if there is severe weather, if you get sick, or if anyone in your immediate family dies. Some plans also cover things like terrorism in the country you’re traveling to. Other plans offer even more expansive policies that could cover you if you lose your job, if you have jury duty, or if your home is burglarized.
Make sure to read the policies on your card carefully to understand exactly what is covered and how much you would get reimbursed. Many people don’t read the coverage policy and assume that they have more coverage than they actually do. They later find out that their credit card travel cancellation policy isn’t enough to cover the full cost of their trip and that they should have gotten supplementary coverage.
Also, it’s important to remember that these policies only cover your trip if you paid for it on your credit card.
Credit Cards That Offer Trip Cancellation Insurance
Interested in getting a credit card with trip cancellation insurance? There are many good options out there.
The Citi Double Cash card offers a great travel policy. It provides up to $5,000 in reimbursements per traveler per trip. The terms are also quite broad for how you might qualify for trip cancellation insurance.
It may cover you if you need to cancel your trip due to injury or illness, if you lose your job, if you’re called to jury duty or active military service. It may also cover you if there is a mandatory evacuation, terrorist incident, or severe weather event at the destination – or if your home is burglarized. There are also a few other situations in which you might qualify to be reimbursed by your trip cancellation insurance.
The Wells Fargo Visa Signature card also offers good coverage. It provides up to $2,000 in reimbursement for canceled travel. But it limits reimbursement to situations involving accident, injury, death or disease in your immediate family, and the default of the airline.
Ultimately, there are many credit cards with trip cancellation insurance, but plans can vary in coverage significantly. That’s why it’s critical that you read the fine print closely so you understand the coverage amounts and situations in which it will apply.
If travel insurance is important to you, then you might want to shop around to find a policy that may cover what you need. If you end up with a card that doesn’t provide enough coverage, it could make sense to buy additional trip cancellation insurance from a supplementary provider.