Insurance Blog

Posted: 12/20/20227,324 Views

With recent protests and instances of civil unrest erupting in parts of Peru – an incredibly popular international destination – many tourists may be wondering if the trip cancellation coverage component of travel insurance would allow them to be reimbursed if they decided to cancel their trip due to civil unrest. This post aims to answer that question.

How Trip Cancellation Coverage Works

Trip cancellation coverage is a primary component of travel insurance. It is designed to reimburse you up to the covered amount for the prepaid, nonrefundable portion of your trip costs if you must cancel your trip for a covered reason.

They key phrase here is “covered reason.”

Each travel insurance plan will have a policy/certificate that lists the exact reasons that are included and excluded from trip cancellation coverage. It is incredibly important that you read this document prior to purchase, as not all travel insurance plans are the same.

If I Cancel My Trip Due to Civil Unrest, Will My Travel Insurance Cover It?

Once again, the official answer comes down to what is listed in the policy/certificate for the particular plan. However, the general answer will usually be “no.” But there are some caveats.

The majority of travel insurance plans do not list civil riots, government regulation or prohibition, or even declared or undeclared war as valid reasons for trip cancellation. In most cases, civil unrest does not affect the entirety of a country or city, so it is still possible for you to go on the trip, even if you’d now prefer not to. Choosing to cancel simply because you are uncomfortable traveling to the destination is not a covered reason for cancellation. 

But remember those caveats? There are a few. Civil unrest can, at times, lead to acts of terrorism. Most travel insurance plans do list terrorist incidents that occur within a specific number of days prior to your scheduled departure date as a covered reason for cancellation. The exact number of days and how a terrorist incident is defined can vary depending on the plan, so read the policy/certificate first.

Another covered reason that can be related to civil unrest is property damage to your destination accommodation. If civil unrest results in your hotel or other prepaid, nonrefundable accommodation being damaged significantly, you may be able to file a claim for trip cancellation reimbursement in accordance with the policy/certificate wording. 

To summarize, while it’s understandable that you may no longer want to travel to your destination due to civil unrest, simply being uneasy about going to a certain place is not a covered reason for cancellation. However, if civil unrest, political upheaval, or any other reason results in a terrorist incident or damage to your destination accommodation, trip cancellation may be covered. In all cases, the wording of the policy/certificate will prevail.

An Additional Trip Cancellation Option

If you want the flexibility to be able to cancel your trip for reasons not covered by standard travel insurance, consider cancel for any reason (CFAR) travel insurance. Provided you meet the eligibility requirements of the CFAR insurance you have purchased, you can receive 50%-75% of your nonrefundable, prepaid trip costs back if you decide to cancel. However, keep in mind that depending upon the penalty percentage for cancellation, the exact amount you can get back may vary.

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