Travel insurance, also known as trip insurance, can help cover some or all of your expenses if your trip is canceled or disrupted due to illness or other issues. “No one ever plans a vacation thinking they will have to cancel, but insurance protects you from all of the ‘life happens’ moments,” says Tiffany Hines, chief executive of Global Escapes, a travel agency based in Athens, Georgia.
Additionally, travelers have the option of purchasing CFAR, or cancel for any reason, coverage. This form of coverage comes at an additional cost, but it allows you to get reimbursement for a percentage of your expenses if you have to cancel for reasons beyond death or illness, such as a job loss or your boss denying your vacation days.
If you add cancel for any reason coverage to your policy — an option that reimburses you for cancellations for reasons beyond those covered by typical policies — your premiums will be about 50% higher, so travel insurance coverage for a $3,000 trip would cost $180 to $360. Experts say travel insurance may not be necessary unless you’re splurging on a big-ticket item like renting a beach house, purchasing theme park tickets for the whole family or staying in a luxury hotel.