How To Find Travel Insurance That Covers COVID-19-Related Cancellations

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With the holiday season quickly approaching, many people are making their travel plans now. But there’s always a chance you may have to cancel, especially with the threat of the ongoing pandemic. While travel insurance often comes to mind as a solution for protecting your trip plans, not just any policy will do.

Read: How To Budget and Plan for a Vacation in 2021Get Ready: Travel Prep: 10 Financial To-Dos Before Going on a Trip

“Sometimes, people don’t understand that not all travel insurances are the same,” said Jess C., founder of Easy American Travel. “Just because you bought travel insurance doesn’t mean that it will cover everything related to your trip, including your health. Travel insurance companies don’t offer everything in one product, and they slip this into two to three products.”

Here’s everything you need to know to ensure you get the right kind of travel insurance in case of a COVID-19-related trip cancellation.

Where To Purchase COVID-19 Travel Insurance

When it comes to COVID-19 travel insurance, the best option for purchasing is through a travel insurance company. Avoid buying travel insurance policies or vacation waivers that are offered as an add-on by travel agencies or booking sites because they are likely to have more exclusions and less chance of covering COVID-19 cancellations.

Options for COVID-19 Travel Insurance Cancellation

There are a couple of options that can cover you if you have to cancel your trip for reasons due to COVID-19. Here’s what you need to know.

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Cancel for Any Reason Travel Insurance (CFAR)

CFAR coverage is just what it sounds like: With it, you can cancel your trip for any reason, including fear of COVID-19.

“If you’re looking to book a trip for the upcoming holidays, look into buying Cancel for Any Reason (CFAR) Travel Insurance,” recommended Amanda Hand, head of marketing and communications at G1G Travel Insurance. “It’s the best way to protect yourself against unexpected cancellations due to a surge in COVID-19 cases, unexpected border closures and a general fear of travel — all things not covered by standard travel insurance plans.”

To get a CFAR insurance plan, you’ll have to purchase a standard travel insurance plan and add the CFAR coverage.

CFAR typically covers 50%-75% of your lost, prepaid travel expenses as long as you purchase it within 14-21 days of your first trip payment and cancel your trip by the specified deadline, which is typically 48 hours before your scheduled departure.

Be advised that the window of time to purchase CFAR may vary by company and not all travel insurance companies offer it. Make sure to read the fine print of the CFAR policy to double-check cancellation deadlines.

Trip Cancellation Insurance

If you are only concerned about contracting the virus and not being able to proceed with your travel plans, trip cancellation insurance may be the way to go.

“Now, if you don’t want to opt for a CFAR plan, a standard trip cancellation plan can cover you if you get sick and can no longer travel, as long as it’s substantiated by a doctor,” said Hand. “There are several other reasons for cancellation that are covered, like a family member passing away or a travel companion getting sick with COVID-19.”

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Cost of Trip Cancellation Insurance and CFAR Coverage

When planning for a trip and the costs of insurance, it can be helpful to know how much extra you may spend. Expect to pay 5%-10% of your total trip cost to add trip cancellation insurance. If you decide to add CFAR coverage, it will typically cost around 40% of your base travel insurance price. For example, if your trip costs $3,000, your travel insurance could cost $150-$300. Then, adding a CFAR plan could cost an additional $120, or a grand total of $270-$420.

Should You Purchase COVID-19 Trip Cancellation Insurance?

“With the uncertainty of travel restrictions around the world, one thing is certain: the need for travel insurance,” said Chelsea Capwell of Travel Insurance Master. “Be sure to review your specific plan details before purchasing and your destination’s, tour’s, and/or cruise’s requirements for the most up-to-date information.”

If you’re only concerned about getting ill from COVID-19 or having a companion become ill, trip cancellation insurance can cover those circumstances. However, if you are concerned that travel to your destination may become unsafe or ill-advised due to COVID-19 or that you may become fearful to travel, you should seriously consider adding CFAR coverage because the trip cancellation insurance will not cover those circumstances.

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