Edited by: Keri Stooksbury
& Kellie Jez
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If you travel even occasionally, you’ve probably purchased or at least considered purchasing travel insurance. And if you’re like most consumers, you’d like to find the lowest price possible at the time of purchase, yet have the best coverage in the event of a claim.
Finding a balance between cost and coverage is the best solution, but it’s not as simple as it sounds. It’s difficult to read through coverage descriptions and interpret insurance jargon.
One way to ensure you’re getting the best travel insurance coverage possible is to consider “Cancel for Any Reason” (CFAR) coverage. While there are certain conditions for purchasing this type of coverage, if it’s available for your trip, it may be worth the extra cost in an environment of uncertainty.
Let’s explore CFAR insurance: what it covers, what it doesn’t cover, and some of the time-sensitive restrictions for purchasing the coverage. We’ll also show you how to find CFAR insurance and discuss which policies might apply to known COVID-19 virus-related events.
Cancel for Any Reason insurance is not a stand-alone travel insurance policy but an add-on coverage that expands trip cancellation coverage to include canceling a trip for any reason.
CFAR coverage can be added to a comprehensive travel insurance policy at the time of purchase.
Normally, the trip cancellation insurance you purchase has limited covered reasons, such as illness or legal obligations, for canceling a scheduled trip and receiving any reimbursement. When you purchase CFAR add-on insurance, you can then cancel your trip for any reason — but there are some caveats.
Timing is a critical element in purchasing CFAR coverage as most policies require that you purchase the CFAR coverage within 14-21 days after you make the first initial trip deposit. There may be other requirements for purchasing CFAR insurance such as insuring your trip for 100% of its total cost.
Additionally, only a certain percentage of your trip costs are reimbursed should you have to cancel, typically around 75% but there can be options to purchase less expensive coverage that might cover just 50% of your trip costs.
CFAR insurance is obviously more expensive than just a standard travel insurance policy as it covers more situations and there is an increased likelihood of a claim. You could pay an additional 40% or more to add on the coverage.
Even with the added cost, if you’re booking an expensive trip and there is a chance you may have to cancel, the extra premium can be worth the peace of mind.
You’ll find trip cancellation as a core coverage on most travel insurance policies. The coverage protects you from unforeseen events that may cause you to have to cancel your trip.
Examples of potentially covered events include:
Trip cancellation insurance reimburses for pre-paid, non-refundable trip costs lost due to cancellation of your trip for a covered reason.
CFAR insurance is also trip cancellation insurance, but it offers much broader coverage. The coverage allows you to cancel your trip for any reason, but you will also pay an additional amount for this protection, with restrictions.
Typical requirements for purchasing the coverage include:
CFAR coverage allows you to cancel your trip for reasons not listed as covered reasons on your travel insurance policy.
Some examples of reasons you might cancel and have coverage under CFAR versus standard trip cancellation insurance include:
CFAR does not cover a trip you booked previously. Limitations vary, but requirements to purchase CFAR coverage can be as soon as within 24 hours of the first initial deposit you make on your trip or you may have as much as 21 days.
Coverage is excluded for trips that have already commenced. Once you have started traveling, however, you may have trip interruption coverage.
Additionally, you may find trip cancellation/interruption insurance on your credit card. This coverage is not CFAR insurance and only applies in the same type of situations you’d find in some trip cancellation policies. If you do not need CFAR insurance, the coverage on your credit card may be sufficient. Let’s take a look at a few of the best cards that offer the coverage.
While the trip cancellation coverage that comes with your credit card does not include CFAR insurance, it may still be sufficient to cover your trip. Here are a couple of the best credit cards that offer trip cancellation and trip interruption coverage.
In addition to being one of the best travel rewards cards, the Amex Platinum’s travel insurance benefits include trip cancellation and interruption insurance that offers a benefit of up to $10,000 per trip, and $20,000 per 12 month period per account.
This card is undoubtedly the #1 card for luxury travel benefits. From the best lounge access (of any card) to statement credits, to complimentary elite status, you can’t go wrong.
When it comes to cards that offer top-notch benefits, you’d be hard-pressed to find a better card out there than The Platinum Card® from American Express.
Make no mistake — the Amex Platinum card is a premium card with a premium price tag. With amazing benefits like best-in-class airport lounge access, hotel elite status, and tremendous value in annual statement credits, it can easily prove to be one of the most lucrative cards in your wallet year after year.
Hot Tip: Check to see if you’re eligible for a welcome bonus offer of up to 125k (or 150k) points with the Amex Platinum. The current public offer is 80,000 points. (This targeted offer was independently researched and may not be available to all applicants.)
You’ll find plenty of premium travel benefits on the card, including worldwide access to over 1,200 airport lounges, such as Centurion Lounge network locations. You’ll also receive hundreds of dollars in credits for Saks Fifth Avenue, Uber, and airline incidental fees.
If your trip is canceled due to a covered reason, coverage is afforded up to $10,000 per incident. The benefit is limited to $20,000 per occurrence (more than 1 person could be covered) and $50,000 per 12-month period.
A fantastic travel card with a huge welcome offer, good benefits, and perks for a moderate annual fee.
The Chase Sapphire Preferred® card is one of the best travel rewards cards on the market. Its bonus categories include travel, dining, online grocery purchases, and streaming services, which gives you the opportunity to earn lots of bonus points on these purchases.
Additionally, it offers flexible point redemption options, no foreign transaction fees, and excellent travel insurance coverage including primary car rental insurance. With benefits like these, it’s easy to see why this card is an excellent choice for any traveler.
The Chase Sapphire Preferred card is packed with benefits and earns big on travel and dining. When it’s time to redeem your Ultimate Rewards points, they’re worth 25% more in value towards travel when redeemed through the Chase Travel Portal. You also have the flexibility to transfer your points to Chase travel partners to redeem for award flights and/or free hotel nights.
For more options, see our dedicated article on the best credit cards for travel insurance coverage.
Due to recent events, you may be looking for coverage that allows you to cancel a future trip if you make a decision not to go due to the coronavirus pandemic. Many existing policies cover trip cancellation due to your own illness, or the illness of other covered individuals, and the coronavirus can be included.
If you simply decide not to go due to fear of traveling or getting quarantined, however, these are not covered reasons under an existing travel insurance policy without CFAR.
Trip cancellation policies typically cover sudden and unexpected events. Since the virus is now a “known event,” a term commonly used in the insurance industry, the only way to secure coverage for a voluntary trip cancellation is by purchasing CFAR coverage on a comprehensive travel insurance policy.
Also, not all travel insurance companies sell CFAR, and those that do have restrictions like the ones we mentioned previously. There is, however, plenty of availability for those who would like to purchase coverage for an upcoming trip or a very recently booked one.
Most travel insurance websites that have made statements addressing the virus offered information on how to purchase appropriate coverage and spoke candidly as to how existing policies apply to the COVID-19 virus.
Here’s a sampling of what they’re saying:
“Select a comprehensive travel policy with CFAR coverage.”
The popular travel insurance search engine, Insure My Trip, informs consumers that if they are looking for policies that could cover COVID-19-related claims, they’ll need to select a comprehensive policy with Cancel for Any Reason coverage.
Another popular site, Squaremouth, represents dozens of travel insurance providers and offers a guide to purchasing travel insurance in light of the pandemic. It also posts a helpful list of statements issued by travel insurance companies explaining whether the virus is covered under their existing policies.
You’ll find a wide selection of travel insurance policies that allow you to add CFAR coverage.
“World Nomads does not have an endemic or pandemic exclusion for policies which means that you may make claims arising from the COVID-19 for the benefits specified in your policy.”
While World Nomads does not offer CFAR add-on coverage, it reminds its policyholders that the coronavirus is a covered illness on its policies just like other illnesses as they relate to trip cancellation and other related trip coverages.
“Many travelers are looking for the flexibility to change their travel plans and seek compensation — they want Travel Insurance Cancellation For Any Reason.”
Aardy recommends Cancel for Any Reason insurance if you’re booking an expensive trip and think you might need to cancel. Its site makes it easy to find and compare travel insurance policies that offer the coverage.
The primary reason to purchase CFAR insurance is to be able to cancel your trip for any reason you feel necessary. The enhanced ability to cancel your trip causes the premium you pay for CFAR coverage to be higher. It is estimated that the surcharge can be at least 40% added to the price of a travel insurance policy.
With that being said, you may be willing to pay the extra money to have peace of mind that you’ll recoup most of your funds should you need/want to cancel.
So, where can you purchase CFAR insurance? Fortunately, it’s readily available but you’ll have to be diligent and read the fine print. Here are some examples of getting a quote for the coverage and making sure it’s included.
Insure My Trip recommends a comprehensive policy with Cancel for Any Reason coverage for consumers who are looking to select policies that would cover voluntary trip cancellations.
When searching for a comprehensive travel insurance policy for 2 travelers, ages 35 and 37, going to Italy on a $3,000 trip about 6 months in the future, the quotes ranged from $118 to $270. When adding CFAR insurance, the quotes increased to a range from $189 to $315, which includes both travelers.
The site also notes that these policies do not cover New York state residents for CFAR due to insurance regulations.
Squaremouth is a travel insurance search engine allowing you to search, compare, and purchase travel insurance for dozens of insurance companies offering travel insurance.
It’s not difficult to find CFAR coverage on Squaremouth. Using the same criteria of 2 travelers, ages 35 and 37, traveling to Italy in 6 months, spending $3,000 for their trip, the site offered plenty of options.
To find policies with CFAR coverage, simply insert your information, and when the results appear, apply the Cancel for Any Reason filter by checking the box.
Searching for a policy with CFAR on TravelInsurance.com is easy. Using the same criteria as previous quote searches, the results looked really competitive. Note, however, that CFAR is an add-on at checkout.
Still, the ease of getting a quote and the comparison feature made it simple to find a policy with CFAR coverage and compare policy details between plans.
While we highly recommend World Nomads for its innovative and comprehensive travel insurance policies, it does not offer CFAR add-on coverage.
If you are an active traveler who participates in outdoor activities or sports, or you’re involved in other adventure-related travel, chances are you’ll find coverage that matches your travel profile with World Nomads.
Aardy.com is a licensed insurance company that allows you to compare over 30 travel insurance providers online. It also has a staff of agents to assist you should you need help selecting a policy.
Once again, we used a scenario of 2 travelers ages 35 and 37 traveling to Italy on a $3,000 trip in October. Benefits listed are per person but total prices include all travelers.
AardvarkCompare is unique in that it also analyzes the travel insurance coverage that the airlines offer when you purchase a ticket. Its advice is to not limit yourself to the 1 option offered by the airline at the time of purchase but to compare several options and select the 1 with the most coverage for the best price.
Hot Tip: AardvarkCompare offers this tip for realizing big saving on airline tickets: if you’re purchasing a refundable fare ticket because you’re not sure of your exact schedule or think there is a chance you might have to cancel, purchase a non-refundable fare for a fraction of the cost and insure the flight with CFAR. A $450 non-refundable flight can be covered for as little as $40 on Aardy or for similar rates on the other sites we mentioned that offer CFAR.
Insurance is regulated by the individual states, so there are differences in policies and premiums depending on where you live. However, some regulations are consistent, such as the Free Look Period, which allows you to review a purchased policy for a specified number of days, usually 10-14 days. If you do decide not to keep the policy, you can cancel and receive a full refund.
Due to the state of New York’s insurance regulations, CFAR insurance is not available for sale in that state.
You may not be able to purchase travel insurance or CFAR coverage for travel to some high-risk areas. If an area is restricted, it will not even be possible to secure a quote for a trip that includes such destinations within the itinerary.
While CFAR coverage may only reimburse 50%-75% of your trip costs, keep in mind that you may be able to recoup some costs from travel providers. For example, an airline might issue a refund minus any change/cancellation fees or a tour operator may issue a partial refund, depending on the situation.
Travel insurance can be a valuable resource should you need it, but it can also give you peace of mind before your trip, knowing you won’t lose your entire investment should you not be able to go. With CFAR insurance, you can also simply decide not to go and still be protected for the majority of your trip expenses.
Purchasing CFAR insurance can make sense even when you’re just purchasing a flight. Airlines offer insurance, but it’s usually just 1 option and not the best price or coverage. Using one of the travel insurance sites that compares several providers can help you select a policy that may give you better value.
While it may not make sense to insure inexpensive trips, if you’re booking flights, hotels, and activities that involve non-refundable deposits, having the added protection will ease your mind and come through for you if you should need to use the coverage.
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For rates and fees of The Platinum Card® from American Express, click here.
Yes, if you’re booking a trip and have some doubt as to whether you might have to cancel, it can be worth it.
In addition to protecting your investment, you are also purchasing the peace of mind you receive in the time frame leading up to your trip.
While CFAR insurance does not cover 100% of your trip costs, you may be able to recoup a portion of your trip costs from the travel provider.
Prices for adding CFAR insurance to a travel insurance policy vary based on coverage. If you purchase coverage that reimburses up to 50% of your total trip costs, it will cost less than purchasing coverage that reimburses up to 75%.
Travel insurance providers show estimates that the cost can range from 40% of the base policy price to 70% of the base price as an additional amount for the coverage.
Cancel for Any Reason insurance, when added to a comprehensive travel insurance policy, allows you to cancel your trip for any reason. Whether you didn’t get your passport renewal back in time, have an unexpected wedding you’d like to attend, or simply decide not to go, you’ll be covered under CFAR insurance.
This broad coverage comes with restrictions, however. You must insure your trip for 100% of its cost, purchase the coverage shortly after you make your first trip deposit, and coverage does not reimburse 100% of your trip costs.
No, trip cancellation insurance that comes with your credit card only covers specific reasons for canceling a trip. Typically covered reasons include your illness, an immediate family member’s illness, jury duty, or your home is made uninhabitable.
Cancel for Any Reason insurance covers canceling your trip for any reason if you have added the coverage on a travel insurance policy at the time of purchase and paid the additional premium.
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