Trip Cancellation vs. “Cancel for Any Reason” – What’s the Difference?

Published by December 5, 2012

One of the most popular reasons travelers purchase travel insurance is to obtain trip cancellation coverage so they may be reimbursed for pre-paid non-refundable trip expenses if they can’t go on their trip. However, many travelers also make the mistake of spending too much on “cancel for any reason” coverage when it is not necessary. There are several factors that distinguish these two separate benefits. Here are the most important differences:

1. “Cancel for any reason” coverage can increase the premium by about 40%. The benefit allows travelers to cancel their trip without providing a reason, but won’t reimburse 100% of trip costs. Reimbursement averages for “cancel for any reason coverage” usually range between 60-90%.

2. Aside from not reimbursing 100% of trip costs, there are a couple of other stipulations that come along with the “cancel for any reason” benefit. Travelers must insure all pre-paid non-refundable expenses and must cancel their trip at least two days prior to the departure date. Additionally, this benefit is time-sensitive and usually must be purchased within 14-30 days of the initial trip deposit.

3. Trip cancellation offers 100% reimbursement for pre-paid non-refundable expenses in the event a trip is cancelled for one of the covered reasons listed on the policy, such as illness or injury of a traveler, traveling companion or family member.

4. Trip cancellation is not a time-sensitive benefit and may already cover several potential reasons for cancellation that travelers may be thinking of.

Travelers should check policy details to determine the covered reasons for trip cancellation before resorting to spending extra on “cancel for any reason.” While the benefit can provide useful coverage for travelers in specific circumstances, it is typically an unnecessary expense.