Does travel insurance cover COVID-19?

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If you’ve planned a trip any time after mid-March of 2020, there is a good chance that you’ve also thought about purchasing something you might not have considered in the past, travel insurance. Since the onset of the COVID-19 pandemic, one thing has become apparent, flexibility is key when it comes to travel right now.

We have seen airlines cancelling flights, countries prohibiting inbound travel from the United States and coronavirus flare-ups across different parts of the world. So it’s understandable that at the top of everyone’s mind right now is the question – if my trip is cancelled because of COVID-19, will I be able to recover my money?

Many travelers who might not have previously considered purchasing traveler insurance are starting to look for ways to ensure that they won’t lose money in the event that their trip is called off. While many airlines have taken great precautions to protect travelers from contracting COVID-19, there is always the chance that you will need to cancel a trip due to the coronavirus.

Although an unforeseeable pandemic might seem like the exact scenario that would prompt someone to purchase travel insurance before booking their trip, in most cases, cancellations due to COVID-19 are not covered. In order to understand why this is the case it’s helpful to take a closer look at what travel insurance is covering and other ways to protect yourself in the event of a COVID-19 related cancellation. 

Does travel insurance cover COVID-19?

To determine whether or not you should purchase travel insurance, let’s start by looking at the question – does any travel insurance cover COVID-19 related trip interruptions?  

Travel insurance is a supplementary form of insurance purchased before you take a trip. It commonly provides medical coverage, trip cancellation coverage and protection in the event of lost luggage or other travel-related inconveniences. Although it might seem like travel insurance is a large umbrella that covers all travel-related expenses, that’s not quite the case. There’s always the fine print…

The World Health Organization designated COVID-19 as a known pandemic in early March. For this reason, most travel insurance companies will claim that interruptions due to COVID-19 are not covered by their plans because this is categorized as a “foreseen event,” meaning that you were aware of the pandemic if you booked travel after mid-March. 

There are two specific situations that travel insurance might cover COVID-19 related claims, but again, check with your travel insurance company to verify:

1. Your travel plans were interrupted because you contracted COVID-19. 
2. You had booked your travel plans before mid-March, 2020. 

Another form of travel insurance to consider is expensive but could cover COVID-related cancellations: a Cancel for Any Reason (CFAR) policy. The pros of this type of insurance are outlined in the name, you can cancel your trip for any reason at all and receive a refund for a percentage of the money that you spent. This might be a 50% or 75% refund on the cost of your trip, depending on how much you paid for the policy. These policies are typically twice as expensive as regular traveler’s insurance, but guarantee that you will be refunded a portion of the money that you spent.

• CFAR Pros: It’s a sure thing and you can avoid arguing with insurance companies about your claim for a refund. 
• CFAR Cons: It’s expensive and you will only receive a partial refund. You can only purchase this before you book a trip (not retroactively). 

Other ways to protect your trip

Since travel insurance doesn’t reliably protect COVID-19 related interruptions in most cases, travelers should think about different methods that can be used to protect your trip before booking travel plans. Here are a few different tactics to consider:

• Check the change and cancellation policy on your hotel or Airbnb before booking. Even before COVID-19 (do we even remember those days at this point) one of the benefits of booking a stay with Airbnb was the transparency of their cancellation policy. Every time you book a stay you can view the host’s cancellation policy, which ranges from flexible to strict, with flexible policies giving the option to cancel up to 48 hours in advance. Many of the major hotel chains are offering flexible bookings during COVID-19, allowing for stays to be changed or cancelled with no fee. Make sure to check with your preferred property and chain to see the most up to date policies.

• Book your flights with an airline that has a flexible change and cancellation policy. Booking a flight on an airline that offers a flexible cancellation policy is a tactic that many of our readers utilized long before COVID-19 became a consideration (although you usually needed elite status or to book with miles to avoid change fees, except on Southwest). When booking a last-minute low fare to a new destination, it’s nice to have that peace of mind that you can simultaneously cancel or cancel your flight just as easily as you booked it. All airlines have their own COVID-19 change fee waivers in effect right now, but big U.S. carriers like Delta, United, American and Alaska have recently announced policies that will kill change fees permanently on all domestic and select international flights.

• Purchase your flights and hotels with a credit card that offers travel insurance and ask your credit card company specifically how they are managing COVID-19 related itinerary changes with their travel insurance policy. If the travel insurance policy does not specifically state how they are treating claims due to COVID-19 you’ll want to have that conversation with them directly. Many of the cards that offer travel insurance are also listed as some of our favorite travel credit cards, so that’s a bonus! The Chase Sapphire Preferred® Card and the Chase Sapphire Reserve® both offer amazing travel insurance and great trip cancellation and trip delay coverage.

Bottom line

In many situations, travel insurance won’t cover your COVID-19 related travel modifications or cancellations, but there are many other ways that you can protect yourself when booking a trip! The key is to give yourself options for easily changing or cancelling your travel plans so that if worse comes to worst, you can easily recover and rebook at your convenience. 

Featured image by Eduard Goricev / EyeEm / Getty Images