Travel insurance will often cover expenses related to unexpected cancellations by your carrier or destination providers, e.g., costs associated with a canceled flight, including accommodation, meals and other incidentals. Cancellations due to emergencies are often also covered, some possible examples include the following:
- Medical advice telling you that you cannot travel
- A death or (sometimes) medical emergency in your family
- A major disaster at home such as a house fire
- Disasters or upheavals at your planned destination that occur after you booked your trip
- Depending on what's happened, the insurer might pay re-booking fees, refund lost deposits, or pay for travel home. Travel insurance pays only for direct losses such as these; you won't get additional compensation for things like your disappointment at your holiday being cancelled.
More expensive policies may also cover your own discretionary cancellations if there is an exceptional circumstance: for example, there are some travel insurance policies that will pay you the cost of your ski lift tickets if a resort has shut due to lack of snow.
There are always a raft of conditions about acceptable and unacceptable cancellations. Some examples of troublesome situations:
• You can purchase insurance covering a trip home because of the death of a family member, but a trip home due to the death of a friend almost certainly won't be covered and even a de facto partner's death might not be;
• Family medical emergencies other than a death often aren't covered; for example the insurance might not cover a trip home to be with a family member who has been hospitalized or diagnosed with cancer --even if it's your own child;
• Many policies cover cancellations or delays due to terrorist activities, but the August 2006 terrorist threat in London demonstrated that few cover cancellations or delays due to the mere threat of terrorist activity;
• If your transportation carrier shuts down, you may not get paid unless they declare bankruptcy;
• Most policies will not cover a strike if you book travel after union members vote to approve a strike (which could be weeks or months ahead of the actual strike). Also, be aware of de facto strikes such as a "sickout"--usually by just one segment of the airline (such as pilots). A few policies may not cover this or cover it only as a delay.
• Some policies cover cancellations if a destination has recently become unsafe due to either a declaration of war or a recommendation by your government to cancel travel to a particular area; others do not cover this.
Take care with cancellation waivers offered by tour packagers or operators and travel packagers/consolidators who've arranged your travel. If you or they must cancel, such waivers typically cover only what you've paid them, and not other related commitments you've made. They a