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Travel insurance that includes cover for cancellations and delays could provide peace of mind if you paid a lot of money for your next holiday. It could reimburse you for pre-paid or non-refundable expenses in the case that your trip gets unexpectedly cancelled or delayed.

So, is it cover you should consider? We run through all the benefits below.

What is ‘travel cancellation insurance’?

Travel insurance can help you recover or limit your losses if unexpected and unforeseeable events cause you to cancel or cut short your domestic or international trip, up to a certain amount. The maximum amount you can claim will depend on the policy limits set by your insurer.

It’s not necessarily called ‘travel cancellation insurance’; rather, cancellation cover or cover of lost deposits and cancellation fees is often included automatically in comprehensive policies or can be purchased as an add-on.

What’s covered by insurance for travel cancellation cover?

Provided you’re insured by the appropriate product, you’ll be covered for deposits, pre-payments and cancellation charges for:

  • accommodation,
  • activities,
  • costs for hired equipment, and
  • transport.

In short, it can cover the financial losses if an unforeseen event has made it impossible or extremely difficult for you to make it to your trip. If you cancel because you ‘changed your mind’ though, you usually won’t be covered unless you have ‘cancel for any reason’ cover. With this type of cover, a part of your losses will be covered.

Depending on the specific policy, what’s covered may vary significantly, though. You should always check your insurer’s Policy Disclosure Statement (PDS) for a complete outline.

Circumstances that are generally covered by insurers include:

  • You suffer from an unforeseen illness, injury or death. This can extend to your travelling companion (who you booked the trip with) or a relative.
  • You’re made redundant from your job.
  • There’s a fire, storm or burglary at your home within a certain time before your departure date.
  • There’s a natural disaster or significant weather event at your intended destination.
  • Your travel documents are stolen just before your departure.
  • A travel warning is placed on a destination after you purchase cover.

In all circumstances, you’ll have to provide documentation and evidence (i.e. a medical certificate or police report) proving your hardship.

A couple sightseeing on a bus

What cover options are available?

Depending on your insurer, they may offer a few different policy options and features for you to choose from.  Should the worst happen, there are cover options that can help relieve the financial and emotional stress.

Note: The inclusions and exclusions of the following will vary depending on your policy and insurer.

What cover options are available?

Travel delay cover

This covers meal and accommodation expenses if your flight is delayed for longer than a certain period (i.e. six or 12 hours) due to reasons out of your control.

If your flight is cancelled, this won’t compensate you for the cost of the tickets, as your airline will normally offer you an alternate flight. That said, they may not be obligated to reimburse you for flights.

Insurers usually offer travel delay cover as a part of cancellation cover.

Cancel for any reason cover

This allows you to, as the name suggests, cancel for any reason! Although this policy may come at a higher price, cancel for any reason travel insurance will cover you even if you change your mind about a trip.

There are a few restrictions on this type of policy. For example, you won’t be able to cancel within a certain amount of time before your departure date (usually 48-72 hours). Furthermore, cancellation cover typically only reimburses 50-75% of your holiday costs, depending on your policy and insurer.

Furthermore, it’s only available if you purchase within a certain number of days of your initial accommodation deposit or the date you purchased plane tickets (usually 10-30 days). Note that not all insurers offer cancel for any reason cover.

Trip curtailment

If you need to cut your trip short because of an unforeseen event – such as a serious injury, illness or the death of a relative – this policy will cover the costs of having to return home. You may even be able to claim the costs of accommodation and travel that you have not used.

What is commonly excluded from travel insurance that covers cancellations?

Most insurers won’t cover you if you want to cancel a trip because you changed your mind or didn’t organise it properly. For example, if you miss your flights because you slept-in or misplaced your documents, you won’t be covered for cancellation.

Other common reasons why cancellation insurance won’t cover you may include:

  • You had to cancel because of a pre-existing medical condition unknown to the insurer;
  • Your annual leave was cancelled, unless you work in emergency services (e.g. police, defence force);
  • Your visa is denied or you don’t have the right documentation with you while you’re travelling;
  • Your flight is cancelled or delayed due to an event within the airline’s control (e.g. a mechanical issue) – that said, the airline will typically compensate or reimburse you;
  • You cancelled a trip because of an unforeseen illness, but you didn’t see a doctor before cancelling the trip;
  • You broke up with your partner;
  • COVID-related losses.

Note: Always check your insurer’s PDS to find policy-specific exclusions as exclusions can vary between insurers.

Frequently asked questions

Frequently asked questions

Will travel insurance cover missed flights?

Your insurer may or may not cover missed flights, depending on the circumstances. If you miss your flights because you were disorganised, for example, you are unlikely to be covered. However, if you miss your flights because of the following reasons, you may be covered:

  • You were involved in a motor vehicle accident;
  • A natural disaster, severe weather, riots or civil unrest started after you purchased your policy and caused you to miss your flights;
  • You have a doctor’s note stating that you are unfit to continue with your trip. The reason you are unfit to continue the trip can’t be because of a pre-existing medical condition unless this was previously disclosed and covered by your insurer.

These guidelines may vary depending on your insurer and policy.

What are policy limits?

A policy limit is the maximum amount you can claim for each benefit. There’ll be policy limits for everything your policy covers, which will be outlined in your PDS. We highly recommend you understand the maximum amount you can claim before you take out cover.

Ready to compare travel insurance?

Now that you know more about travel insurance for cancellations and delays, you can see that it can be invaluable protection for unexpected events that can derail your trip.

So, what are you waiting for? Compare travel insurance today! Comparing helps you figure out what will suit your trip, at a price you’re comfortable paying.

Best of all, you can compare a variety of policies and get free quotes from some of Australia’s top insurers when you compare with us. And if you do find a policy you like, we don’t add any hidden fees or mark up the price if you purchase through us.

Ready to look for a better deal? It’s easy to compare with us.

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