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Flight Cancellation Insurance: Your Questions Answered

Cancelled Flights
Allianz - Cancelled Flights

I got the flight cancellation email at 1 a.m., five hours before I was supposed to depart for Toronto for a long weekend. “We have automatically rebooked you on another flight,” it said.  “We apologize for the inconvenience.”

Oh. OK, I thought sleepily. I read it again. The new flight was 24 hours later. Wait. That’s not OK!

Luckily, I had Allianz Travel Insurance, so I knew everything would be OK. But I still had questions: Could I salvage my trip? What was I supposed to do? And how could my flight cancellation insurance help me?

Here are the answers to all those questions.

What is flight cancellation insurance?

Generally speaking, flight cancellation insurance reimburses you for covered, non-refundable costs related to a canceled flight.

When you’re buying travel insurance, you won’t see “flight cancellation insurance” listed as a specific benefit in your plan. That’s because several different benefits can apply to flight cancellation, depending on whether the canceled flight ends up delaying your trip, interrupting your trip, or canceling your trip altogether.

Read more: What Should I Do If My Flight Is Canceled?

How does flight cancellation insurance help when the airline cancels your flight—and you end up canceling your whole trip?

Let’s say you find yourself in the same situation I was in, when the airline cancels your flight and messes up your travel plans. In this scenario, you have to decide if you’ll accept the rescheduled flight, or if you’ll cancel the trip altogether.

If you opt not to rebook after a canceled flight, then the airline should refund your money. “A consumer is entitled to a refund if the airline canceled a flight, regardless of the reason, and the consumer chooses not to travel,” says the Department of Transportation. This applies even if you purchased a non-refundable ticket. However, airlines often will issue that refund in the form of a travel credit or voucher, instead of cash.

What about other pre-paid travel expenses, such as an Airbnb rental or museum tickets you’d already purchased? That’s where travel insurance comes in. If your airline can’t get you to your planned destination for at least 24 consecutive hours from the originally scheduled arrival time because of a natural disaster, severe weather; an FAA or foreign equivalent mandate; or a strike, then your trip cancellation benefits kick in. That means you can cancel your trip and file a claim for your pre-paid, nonrefundable trip costs.

If your trip has already begun, and you miss at least 50% of the length of your trip due to a travel carrier delay (e.g. a canceled flight), then your trip interruption benefits can reimburse those pre-paid, nonrefundable trip costs.

How does flight cancellation insurance help when the airline cancels your flight—and your trip is delayed?

In this scenario, the airline cancels your flight and rebooks you on a different one. You’ll still reach your destination, but later than you planned. Then, travel delay benefits become your best friend.

Did your canceled flight causes a covered travel delay, as defined in your plan? Then your trip delay benefits can reimburse you for meals, a hotel stay, transportation and other eligible expenses during the delay (up to the maximum limit for your plan). You also can be reimbursed for the portion of the trip that you miss. Voilá: your unexpected layover has turned into a mini-vacation, with your key expenses paid.

If your plan includes SmartBenefits®, you can opt to receive a fixed inconvenience payment of $100 per insured person, per day, for a covered delay. You don’t need to provide any receipts — just proof of the delay.

How does flight cancellation insurance help when the airline cancels your flight—and the rescheduled flight won’t work for you?

Your brother’s getting married abroad in Mexico on Saturday, at a gorgeous resort in San José del Cabo. Unfortunately, the demands of your job mean you can’t fly until Friday. And wouldn’t you know it? A storm cancels your flight, and the best the airline can do is put you on a plane leaving late the next evening.

That’s not going to work. You can’t miss the ceremony—you’re the best man! Can flight cancellation insurance help?

Yes. If your travel carrier can’t get you to your destination for at least 24 hours from your originally scheduled arrival time due to a covered reason (such as severe weather), your travel insurance trip interruption benefits can reimburse you for alternate transportation, less available refunds, if you can get to your original destination another way. So if you discover that another airline has an available seat on a flight leaving Friday night, go ahead and book it so you can make it to the wedding on time.

What if you need help figuring out your alternate transportation plans? Contact 24-hour assistance. While we can’t book travel on your behalf, we’ll do our best to help research the options and assist you with finding a new flight.

How does flight cancellation insurance help when you make the decision to cancel your flight?

Your trip cancellation benefits can reimburse you for a canceled flight and other pre-paid, nonrefundable trip expenses—but only when you cancel for a covered reason.

Covered reasons are specific situations and events that, when they occur, mean you may be eligible to make a claim. It’s important to know that most travel insurance plans do not cover flight cancellation for any reason.

Your plan documents will list all the covered reasons for trip cancellation, such as:

  • You or a traveling companion becomes seriously ill or injured, or develops a medical condition
  • A family member who is not traveling with you becomes seriously ill or injured, or develops a medical condition
  • A traveling companion or family member dies
  • You need to attend the birth of a family member’s child
  • Your primary residence is uninhabitable
  • Your destination is uninhabitable

Flight cancellation insurance can’t reimburse you if you cover for a non-covered reason, such as:

  • You oversleep and miss your flight
  • You change your mind at the last minute and decide not to go
  • Your dog gets sick
  • You leave your passport at home, and the airline won’t let you board

Have questions about what can and can’t be covered? Contact us! We’re always here to help.

Is flight cancellation insurance worth it?

With airline cancellations and delays on the rise, it’s always smart to defend yourself with travel protection you can trust. When you get flight insurance as part of a complete travel insurance plan, you can travel without worrying about all the things that could go wrong. If cost is an issue, consider an affordable travel insurance plan such as OneTrip Basic or OneTrip Cancellation Plus.

Find the right travel insurance for your next trip.

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