Trip Cancellation Insurance: ‘For Any Reason’ Policies

At times, a trip cancellation insurance with a ‘for any reason’ provision is necessary. Booking your tickets ahead of time is a great way to travel. For a start, you can purchase flights at an incredibly discounted rate. Moreover, determining your travel dates in advance gives you a timeframe to plan around. Having said that, sometimes things change. For instance, you could book a July flight during March for cheap. However, who knows what your children’s summer school schedules will look like. Similarly, it may be difficult to define the exact date of your official vacation.

Above all else, traditional travel insurance plans don’t offer a lot of room for flexibility. While medical emergencies are certainly covered, many other cancellation reasons aren’t. To add to that, airline fees are also expensive. At the end of the day, changing your flight could wipe away the financial benefits of early booking. Yet a ‘for any reason’ policy fills these gaps. Not only are the plans affordable, but, as their name suggests, they reimburse you when you cancel your flight for any reason.

Trip Calculation Insurance: ‘For Any Reason’ vs. General Policies

The average ‘cancel for any reason’ insurance is 50% more expensive than a typical travel policy. Moreover, the former will only reimburse you 75% of your expenses, and not the entire price. Yet these policies are certainly still worthwhile. The average cost of an airplane ticket is just shy of $400 ($379, to be specific). Meanwhile, most airlines charge a $200 cancellation fee, which is more than 50% of the price. In contrast, travel insurance companies charge between 4% and 10% (or 6% to 15% for a ‘cancel for any reason’ policy).

To illustrate, assume that a traveler purchased tickets for $400. They would pay $16 to $40 (or 4% to 10% the total price) for general travel coverage. Trip cancellation insurance with a ‘for any reason’ provision would cost $24 to $60. If the traveler’s plans changed (regardless of why), the policy reimburses them $300 (75% of $400). To put it another way, the remaining $100 (25% of the ticket price) is only half the $200 cancellation fee that they would incur without any insurance.

Travel Insurance: What’s Included?

Typical travel insurance plans cover cancellations due to medical emergencies, car accidents, and work/employment commitments. For example, a nurse had a one-week vacation and bought plane tickets to Hawaii. However, the day before the flight, one of the hospital’s workers got sick and the nurse was called in. Therefore, she had to delay her flight an extra 24 hours. In this case, most travel insurance plans will cover work-related schedule changes.

Policyholders are also protected when they become victims of a felony (such as burglary) or their flight gets cancelled due to extreme weather conditions. Yet this doesn’t expand to other situations. For instance, a traveler got worried about civil or political problems in their destination. Flight insurance doesn’t reimburse them if they change their vacation plans. Just as importantly, you can’t file a claim when an event organizer cancels a conference or concert. There may be exceptions to this, though.

Trip Cancellation Insurance: For Any Reason Coverage

A ‘cancel for any reason’ policy will reimburse you when you change your mind about traveling, regardless of why. You could decide to stay an extra day, week, or month before you return home. You may also cancel the trip altogether because you wanted to stay in town or visit another destination. This policy is ideal in several scenarios.

A group of college friends, for example, wanted to book their spring break airplane tickets in November. The students couldn’t know what their class schedule would look like until the next semester starts in January. Therefore, they purchased ‘cancel for any reason’ policies in case they needed to reschedule the flights.

Contacting the Airlines

A ‘cancel for any reason’ policy shouldn’t be your first option. To put it another way, many airline companies may give you a full refund when you cancel early. Generally, the deadline is seven days prior to the flight, but some of them could honor your request if you inform them three days ahead of time. In certain cases, airlines may not give you a refund. Alternatively, they return the price of the ticket in the form of a credit. You may use the amount to book another flight at any point in the future.

Some companies, however, may only let you exchange the ticket for another date or destination, without applying any credits or refunds. Just as importantly, fliers that join a miles membership program or book business/first class tickets enjoy special benefits, including the ability to flexibly cancel or change plans. In short, travelers should understand what the airlines’ policy is and how it impacts potential cancellations. Subsequently, they can make informed and financially-tactical choices.

When you weigh the pros and cons of a traditional vs. ‘for any reason’ policy, keep in mind that the price difference between them is relatively minimal. This is even more so the case when we compare that to airlines’ cancellation fees. While traditional travel insurance covers a handful of circumstances, it isn’t as flexible and convenient as a ‘for any reason’ plan.

To put it another way, paying a small percentage of your already cheap price to obtain coverage is advantageous when you book early. Otherwise, the fees and additional expenses could cost you more than purchasing an inflated ticket right before the flight leaves.

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