Generally, travel insurance policies cover unforeseen events. Financial default often requires meeting additional conditions such as purchasing within an advantage period from the date of first deposit (usually 14 - 21 days) and most have a 14 day waiting period from the time insurance is purchased. Make sure the policy covers your travel provider. A few insurance carriers (i.e Elvia) list companies it will cover if they suddenly default. AIG Travel Guard, Travelex and MH Ross list troubled companies they will not cover.