Going to travel? Think about trip cancellation insurance

Only one week is left until June, the first month of summer. In spite of the recession and slowing economic activity, many people are going away on vacations. Traveling is one of the most enjoyable pastimes - and one of the most expensive! 

If you or someone in your family gets sick at the last moment, you can lose some or all of your prepaid trip expenses. Compensate the losses with trip cancellation insurance! It is aimed to protect travelers who have to cancel a trip due to an unforeseen emergency. 

What is trip cancellation insurance

Trip cancellation insurance will cover your prepaid, nonrefundable expenses if you are forced to cancel a trip. Basically, most policies state that they will reimburse your losses if you, your close family member or your traveling companion have a sudden illness, injury, sickness, or even death. 

Trip cancellation insurance may also cover travelers that are chosen for jury duty, quarantined, or hijacked; if their home is damaged by fire, hurricane or earthquake or if their tour operator, cruise line or airline declares bankruptcy. 

Most policies state that the insured persons cannot receive the benefits just because they changed their mind. So if you decide to cancel a trip because you are afraid of Swine Flu, you may lose your money. Luckily, you can find policies that allow "cancel for any reason" upgrade for an additional fee.

Trip cancellation insurance will cover any prepaid travel-related expenses that you can’t obtain a refund for - airfare, cruise deposits, hotel accommodation, car rental deposit and possibly cancellation penalties imposed by various agencies.

The cost of trip cancellation insurance will vary, but the traveler can expect to pay fees that range from 5% to 10% of the total cost of their trip. Sometimes trip cancellation insurance cannot be purchased without travel medical insurance from the same company. 

If you decide to purchase trip cancellation insurance, it makes sense to do it in advance to have longer coverage time. The premium will remain the same no matter when you buy your insurance. If you hesitate, you may have an unexpected event that will not be covered. 

Keep in mind that trip cancellation insurance may be available automatically through your credit card company if you book your trip using their credit card. Don’t pay twice! Just call your customer assistance center and ask them about this service. 

How to purchase trip cancellation insurance online 

1.    Look for a reliable insurance company. Ask your friends and travel agents, browse travel forums or just use searching engines. There are many websites where you can find what you need - Travelex, Travel Insured, USA Assist, Travel Guard and others. 
2.    Obtain online quotes. Typically, you will need to enter your travel details including trip dates, trip cost, your primary residence, and age of all travelers. Then, click “Obtain quotes” button to receive a list of all plans that you are eligible for. 
3.    Make sure that you have enough coverage to compensate your losses if your trip is cancelled. 
4.    Read the fine print carefully to find out what expenses are covered by the policy. Trip cancellation insurance is packaged differently by a wide variety of travel companies and agencies. 
5.    Read exclusion clauses. For instance, most policies state that they will not pay the benefits if the insured have to cancel their trip due to an illness that they have been treated for by a doctor in the last 1-6 months.
6.    Pay attention to expiration dates. Some policies may require the insured to cancel their trip no later than 48 hours before the departure date.