Trip Cancellation Insurance: Plans & Coverage

Example Scenarios	% of Cancellation Policies on Squaremouth that Offer This Protection	Important Points to Know
Traveler, companion, or a family member becomes ill or dies	100%	Typically only applies to close relatives & travel companions. Details vary by policy
Flights are cancelled due to a blizzard	99%	Typically requires you to cancel the entire trip, not just a flight
A hurricane warning is issued for your destination	99%	May apply to hurricane warnings, or may require an evacuation or a disaster declaration
A terrorist attack occurs at or near your destination	93%	Generally doesn’t apply to fear of terrorism
You’re laid off from your job	86%	Doesn’t apply to terminations due to poor performance
Your travel supplier ceases operations due to financial insolvency	69%	May not apply if a travel supplier declares bankruptcy but is still operating
Your employer cancels your vacation	35%	You may be ineligible if you recently started your job

Caveats & Exclusions to Consider

Cancellation terms can vary significantly between policies, so it’s important to read your plan certificate closely and familiarize yourself with any fine print, caveats, and exclusions.

For example, the following caveats could limit your trip cancellation coverage:

• Trip Cancellation coverage may exclude pre-existing medical issues unless your policy includes a Pre-Existing Condition waiver.
• Most policies come with both a per-person and per-policy reimbursement limit. The average reimbursement rate for cancellation policies on Squaremouth is around $50,000, but can be as high as $150,000 per person on some policies, so it’s important to ensure your policy matches your trip cost for each of the above parameters.
• Most policies require you to insure your full trip costs for coverage to apply, and underinsuring your trip could even disqualify you from time-sensitive benefits, like CFAR.
• Reimbursement is limited to the actual trip cost of your trip, verified by booking receipts when submitting a claim. So, be sure not to overstate your trip cost when booking, as this will not lead to a higher claim payout.

Consider Cancel For Any Reason (CFAR) Coverage

CFAR coverage is the only way to cover you for scenarios commonly excluded from Trip Cancellation coverage, including the ones mentioned above.

Cancel For Any Reason coverage is only offered as an optional add-on and provides 50-75% reimbursement when you cancel for any reason.CFAR coverage is particularly valuable when visiting riskier destinations, traveling during winter storm and hurricane season, or when you have a higher chance of cancelling for a reason that falls outside standard coverage.

CFAR is available on roughly 36% of the plans on Squaremouth, and can be found by using our online quote tool to filter for policies with CFAR coverage. Lastly, this is a time-sensitive benefit, so be sure to purchase early.

How Much Is Trip Cancellation Insurance?

Trip cancellation coverage is offered as part of a comprehensive policy, which our internal sales data from the past 12 months shows costs around $35 per day for full trip cancellation protection.

The average comprehensive travel insurance policy cost customers $448 with an average trip length of 13 days.

That said, premiums vary depending on many factors such as, trip cost, destination, age, trip length, types of coverage and limits, and state of residence. As a rule of thumb, expect to pay between 4%-10% of your total insured travel expenses for comprehensive travel insurance.

>> Learn how to calculate your trip cost

Do I Need Trip Cancellation Insurance?

We recommend Trip Cancellation insurance if you fall into one of the following groups:

• Travelers booking “bucket list” or once-in-a-lifetime trips: It’s a good idea to protect the time and large sums of money spent on planning these trips.
• Those traveling during hurricane season or winter: These seasons have a high risk of weather-related cancellations. Even if you aren’t traveling in a hurricane-prone area, the entire flight network can be disrupted by delays and cancellations at major air hubs due to regional weather events.
• Seniors and retirees: Seniors tend to spend the most on travel, and therefore, have the most to lose if a trip is cancelled.
• International travelers: International trips cost more and have a higher risk of disruption.
• Travelers with elderly or ill family members: You may want trip cancellation coverage in case you need to cancel for a funeral or medical emergency.
• Cruise passengers: Cruises are switching to stricter cancellation policies post-pandemic, with non-refundable deposits and steeper penalties.
• Group tour travelers: Cancellations may depend on group coordination and factors outside your control.

Most Popular Trip Cancellation Insurance Plans

These are the top three most popular plans for Trip Cancellation Insurance on Squaremouth due to the value and the benefits offered.

IMG iTravelInsured Travel LX offers the highest overall limit for trip cancellation of the plans on our site, while Travel Insured International FlexiPAX is a good value for families with kids. Tin Leg Gold provides the best balance of benefits for the price.

See our list of the top Cancellation Travel Insurance Plans for 2026

How to Buy Trip Cancellation Insurance

1. Calculate how much coverage you need. To get a quote, you need to know your total trip cost. Start by calculating major expenses like airfare, accommodations, and cruise bookings. Be sure to only include non-refundable expenses in your cost.
2. Determine what other benefits you need in your plan. Consider whether you’ll need other benefits like Emergency Medical, Medical Evacuation, and adventure sports coverage, as well as what amount of coverage you’ll need.
3. Compare plans. Use our quote form on Squaremouth to get a list of plans that contain all your required benefits and to compare quotes for your trip.
4. Balance affordability and coverage. Aim to find the best value for the money, but be sure to prioritize adequate coverage over lowest pricing.
5. Purchase your plan early. We strongly recommend purchasing your policy as soon as possible after booking your trip. Buying coverage early minimizes the chance of an illness or event occurring that could be excluded from coverage. Plus, many policies have time-sensitive benefits that require you to purchase coverage within 14-21 days of your initial trip deposit.

How Do I Use My Trip Cancellation Insurance?

To file a Trip Cancellation Insurance claim, first review your policy to verify that your cancellation reason can be covered under your insurance.

Cancel your trip and request a refund from your travel suppliers as soon as possible. You’ll need to provide proof that you weren’t eligible for a refund when requesting insurance reimbursement.

Gather all the documents you need to support your claim, including receipts, doctors’ notices, messages from your airline or other common carrier, proof of refunds, vouchers, or denials.

Submit your claim via your provider’s online claim portal by the deadline specified in your policy, and check back periodically for requests for additional information or documents.

Is Trip Cancellation Insurance Worth It?

Trip Cancellation Insurance is worth it if you need to protect an expensive vacation or your trip has the risk of disruption due to illness, airline, or weather-related issues.

According to our summer 2026 travel survey, 85% say travel insurance is essential. Our internal data from the past 12 months shows that customers received an average of $4,944 in reimbursements for approved cancellation claims.

If there’s a high chance of your trip getting cancelled or disrupted, you should strongly consider purchasing travel insurance.

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FAQs: Trip Cancellation Insurance

What Is the Difference Between Trip Cancellation and Trip Interruption Insurance?

Trip Cancellation insurance is a pre-departure benefit that covers 100% of your trip if you need to cancel it due to a covered reason. Trip Interruption insurance, on the other hand, is a post-departure benefit. It covers up to 150% of your trip costs, including your return ticket, if your trip is cut short. This includes arriving late to your destination due to a covered delay or ending your trip early due to a covered reason, such as a family emergency.

Can I Buy Trip Cancellation Insurance Only?

Yes, some policies offer Trip Cancellation insurance with no medical coverage for a slightly lower cost. Look for plans with a $0 limit for Emergency Medical and Medical Evacuation coverage when comparing plans on Squaremouth’s quote page.

Does Travel Cancellation Insurance Offer Refunds for Flight Credits?

No, you won’t get travel insurance for cancelled flights if you receive a flight credit. Flight credits are considered a refund, and flight cancellation insurance only covers non-refundable costs. If you want your travel insurance policy to refund your flight costs, you’ll need to turn down any flight credits that your airline offers.

Can I Buy Trip Cancellation Insurance After Booking?

Yes, you can buy Trip Cancellation Insurance after booking your trip. You can purchase coverage up to a day before your trip, though we recommend purchasing a policy as soon as possible to qualify for time-sensitive benefits and to take full advantage of your policy.

Can I Buy Trip Cancellation Coverage If Someone Else Paid for My Trip?

Yes. Even if another person booked or paid for your trip, you can still purchase your own travel insurance policy with Trip Cancellation coverage. Simply insure the prepaid, non-refundable costs associated with your share of the trip, such as your airfare or portion of the hotel expenses.

Use the original booking date when completing your quote, even if someone else made the booking. Keep invoices, receipts, and credit card statements on hand, as these will be required when filing a claim.

Are Trip Cancellation Insurance & Flight Cancellation Insurance The Same Thing?

No, Trip Cancellation insurance is built to reimburse your entire trip cost if you are forced to cancel, whereas flight cancellation insurance is built to allow you to cancel a flight and receive a refund for the cost of your ticket. Therefore, travel insurance with Trip Cancellation coverage is much more comprehensive as it protects your entire trip cost, including your flights, and also offers coverage for things like lost and delayed bags, missed connections, and delayed flights.

Does Trip Cancellation Insurance Cover Illness, Injury, or Death?

Yes, Trip Cancellation insurance almost always covers cancellations due to illness, injury, or death and is found on all cancellation policies sold on Squaremouth.

Cancellation for Medical Reasons generally includes coverage for:

• Injury, illness, or hospitalization to you or a travel companion, including Covid-19 or another covered pandemic-related virus
• Severe injury or illness of an immediate family member that requires your care
• Death to a non-traveling immediate family member

This benefit only applies to serious illnesses that prevent you from starting your trip and requires documentation from a medical professional. It won’t cover the cost of medical care, or illnesses or injuries that existed when you purchased the policy.

Does Trip Cancellation Insurance Cover Hurricanes, Severe Weather, & Natural Disasters?

Yes, hurricanes, severe weather, and other natural disasters like floods, wildfires, earthquakes, and volcanoes are included under 99% of Trip Cancellation policies on Squaremouth.

Generally, weather has to be classified as a natural disaster or cause destruction, major closures, or a complete cessation of services to qualify. However, certain providers can cover any cancellation by a common carrier due to severe weather conditions. Some can even cover obstructions to public roadways or public transportation that prevent you from getting to your common carrier.

Coverage only applies to unforeseen events and excludes named storms and forecasted weather events that occurred before you bought your policy.

Does Trip Cancellation Insurance Cover Terrorism?

Yes, terrorism is commonly covered by Trip Cancellation insurance and is included on 93% of the policies on Squaremouth. Typically, the following conditions must be met:

• The attack must occur in or near a city listed on your itinerary
• The attack must occur within 7-30 days of your scheduled departure date
• There have been no other terrorist incidents in the same city within a specified period of time before your departure date, usually 90 days

Most insurance companies require the event to be a certified act of terrorism by the U.S. Department of State, the Secretary of the Treasury, or the federal government where the attack occurred. Some providers won’t consider an event an act of terrorism unless there is loss of life or major property damage. Plans may also require a Level 4 “Do Not Travel” advisory from the U.S. Department of State.

Does Trip Cancellation Insurance Cover Jury Duty or Other Legal Obligations?

Yes, most policies let you cancel your trip and receive reimbursement if you are forced to attend legal summons like jury duty, a court subpoena, or other mandatory legal obligations, but it does not apply to legal obligations arising from illegal acts or drug and alcohol-related offenses.

To file a claim, you’ll need to supply an official copy of your subpoena or summons.

Does Trip Cancellation Insurance Cover Bankruptcy or Financial Default?

Yes, 69% of policies on Squaremouth offer Financial Default coverage that reimburses you if your travel supplier unexpectedly stops operating due to financial insolvency. This is a time-sensitive benefit, which means you must purchase coverage within 10-21 days of your initial trip deposit.

That said, bankruptcy, where travel services may continue to be offered by the provider, is not the same as financial default and may not be covered.

Does Trip Cancellation Insurance Cover Cancellations For Work Reasons?

Cancellations for Work Reasons is only covered by about 35% of policies on Squaremouth. Some plans also offer it as an optional add-on benefit. It covers travel cancellations due to unforeseen work requirements, like:

• Revoked PTO
• Required work attendance during your trip
• Mandatory schedule changes

This coverage only applies when previously approved time off is revoked by an employer. It does not cover situations where you start a new job and have never had your vacation time approved. Cancel for Work Reasons also excludes foreseen or voluntary work changes.

Does Trip Cancellation Insurance Cover Employment Layoffs?

Yes, 86% of the Trip Cancellation policies on Squaremouth cover cancellations due to a layoff. Eligibility requirements for this benefit typically include:

• Full-time employment: Coverage does not usually apply to seasonal, part-time, self-employed, or short-term employees.
• Minimum employment length: Typically between one to three years.
• No fault: Coverage only applies to terminations due to things like mass layoffs or budget cuts, not due to job performance.
• Waiting period: Terminations are only covered after a set amount of days after your policy’s effective date, typically 14-30 days.

Does Trip Cancellation Insurance Cover Transportation Strikes?

Yes, some policies can cover travel cancellations due to strikes from a common carrier, including airline, air-traffic-control, and train strikes. For this coverage to apply, you must have purchased your policy before the strike became a foreseeable event. If the strike was announced before you purchased your policy, coverage won’t apply.

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Please be aware that coverage and eligibility requirements for this benefit differ by policy.