A travel insurance policy covers the trip cancellation, medical expenses, any loss or delays, evacuations and 24*7 assistance!
That means your trip cancellation insurance is covered, once you opt for a travel insurance while booking the trip, your non-refundable, pre-paid expenses are reimbursed if there's a valid reason!
How Does a Trip cancellation Insurance work?
Once you have booked all the necessary tickets for your trip and due to some unforeseen event, you happen to cancel your trip! In such cases, the tour operator will charge various cancellation fees to cancel your trip. These cancellation charges vary from one operator to another!
The closer the departure date, the higher the cancellation charges! Also, no show and very late cancellation cause an extremely high cancellation charge, usually even 100% of the trip cost!
That's where the trip cancellation insurance comes into the picture! The tour operator charges a cancellation insurance fee while booking the trip.
So, if you have bought a ticket that costs say $900 and you cancel your trip a week from departure, then the operator might charge you 75% cancellation fee.
This may cost $675 of the total amount paid i.e. you will only receive $225! But if you have opted for cancellation insurance, you will receive the full cancellation fee i.e. $675 won't be deducted from the reimbursement amount.
When Can You Opt for Cancellation Insurance?
You can only opt for full reimbursement under the cancellation insurance rule if the reason you stated...
- is listed in the policy - is unforeseen and unintentional - takes place after you have opted for the cancellation insurance
Common scenarios when Cancellation Insurance is Granted
- A family member dies
- You or some close family member is injured or ill
- Change of dates of paid leaves from work
- Some damages occur in your home -Any natural calamity or a terrorist activity takes place at your place of destination
- You need to reappear for an examination - Your ID or travel ticket is stolen - Your visa has been denied
- You need to look out for a job or are made redundant
In case of any of the above events or other genuine reasons, you need to opt for cancellation insurance, you will have to claim the reimbursement within 5 days of the event, with proper supporting documentation (such as medical certificate, death certificate, a certificate from employer, etc)!
How To Purchase Trip Cancellation Insurance
While you are booking your tickets, you will find an option of opting for the trip cancellation. There are additional charges incurred, usually 4-7% higher than the original ticket rates, when you opt for cancellation insurance.
Scenarios When Cancellation Insurance Won't Work
In case you have cancelled the trip due to illness but failed to visit a doctor before doing so! In such a case, you won't have valid supporting documentation (medical certification) as proof of your illness. However, some insurance policies allow you to have a doctor visit within 72 hrs of cancelling the ticket!
You need to have proper documentation ready with all bills, receipts, any refunds you received alongside the document that justifies your cancellation.
You have purchased the ticket when there was a natural phenomenon waiting to happen and authorities had already warned against the same.
Carefully read the terms and conditions of the trip cancellation insurance before opting for same and keep in mind all the situations when you will be able to benefit from the same, just in case you need to cancel your trip!