When COVID-19 brought travel to an abrupt halt in 2020, travelers were shocked to learn that their insurance didn’t cover travel changes due to an epidemic or pandemic. Many travelers who were on the road as the shutdowns began had to shell out their own money to book earlier flights home, while those with trips scheduled in the future were suddenly out all the money spent on nonrefundable tickets and accommodations.
Now as travel slowly resumes, you might be on the hunt for a new travel insurance plan that won’t leave you high and dry if the worst should happen. Plus, some destinations actually require that you have medical insurance. If you’re confused about where to start, we get it — it’s complicated. That’s why we’re here to lay out your options. Whatever policy you choose, make sure to read the fine print carefully and speak with your provider about any concerns.
1. Cancel for Any Reason (CFAR) Insurance
If you’re extremely worried about losing money on your trip, CFAR insurance is likely the best plan for you. “For travelers with concerns that can’t be covered by a standard policy, including fear of traveling because of coronavirus or sudden travel bans, Cancel for Any Reason coverage remains the best option,” says Kasara Barto, a spokesperson for travel insurance comparison site Squaremouth. “This time-sensitive upgrade is only available within the first two to three weeks of trip booking, so travelers interested in this lenient coverage should search for a policy as soon as possible after booking their trip.”
The major downside of CFAR insurance is that it’s expensive and it doesn’t necessarily guarantee that you’ll get all your money back. Barto notes that CFAR plans are typically 40 percent more expensive than standard travel insurance policies, and they only cover up to a 75 percent reimbursement of nonrefundable trip costs. Bottom line: This kind of policy might only be worth it if you’re taking a really, really expensive trip.
2. Pandemic-specific Insurance
While most insurance providers have kept their policies pretty much the same (i.e. they still exclude the pandemic as a reason for coverage), a select few are offering new plans designed specifically for pandemic-concurrent travel. Seven Corners, for instance, has an option that includes COVID-19 medical coverage, which is valid for up to $100,000 in coronavirus-related medical expenses. Meanwhile, Allianz has added a special COVID-19 provision into some of its policies that cover cancellations, interruptions, and medical expenses arising from contracting the virus before or during a trip. Again, reading the fine print is key here.
There are also travel insurance policies that have been developed specifically for the new ways in which people are traveling — namely, domestic road trips. Berkshire Hathaway Travel Protection launched its ExactCare Lite policy for that exact reason.
If you are traveling domestically, keep in mind that your health insurance will likely cover you during your trip. “In that case, trip cancellation coverage will be the most important benefit for these travelers, as it can reimburse 100 percent of their nonrefundable trip costs if they have to cancel for a covered reason,” says Barto.
3. Provider-offered Travel Insurance
In order to win back travelers, a number of airlines, hotels, and cruise lines are now offering specific COVID-19 travel insurance policies, which might even be free. Virgin Atlantic and Etihad both include free COVID-19 travel insurance with every booking, while hotel groups like Club Med, Iberostar, and Palladium are providing similar programs. Cruise line Atlas Ocean Voyages has also implemented emergency evacuation and return-to-home insurance policies for all guests.
But again, not all provider-offered insurance plans are made equal, which is why reading the fine print is crucial. “While airlines often make a push for customers to add insurance while booking a flight, likely due to a financial arrangement with the insurer, these plans don’t always offer the level of protection you might expect,” says Zach Griff, travel analyst and editor-at-large at The Points Guy. “Coverage only kicks in when certain conditions are met, for example — and voluntarily choosing not to travel, even due to pandemic-related concerns, isn’t typically enough to justify a payout.”
4. Credit Card Travel Insurance
You’re probably aware that many credit cards already have travel insurance policies built into them. “When you pay for covered travel using your card, these programs may reimburse you for lodging, meals, and ground transportation after an airline cancels your flight,” says Griff. While these policies are helpful for general travel issues, they might also cover some, but not all, pandemic-related issues. For instance, they might refund you if you were to fall ill with COVID-19 prior to your trip, but they might not reimburse you for canceling your trip because of border closures due to the pandemic. It’s all up to the insurance provider.
5. Standard Travel Insurance
Even though standard travel insurance policies typically exclude coverage for reasons related to a pandemic, most travel providers like airlines, hotels, and cruises are offering free cancellation to all guests. These cancellation policies might just be the kind of reassurance you need to book your trip. Just note that anything you’ve paid for outside of your flight, hotel, or cruise will likely not be covered, so you’d still be on the hook for those expenses. Additionally, some providers have very specific time frames for cancellation, and others only offer a credit toward future travels rather than a full refund.
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