Is ‘Cancel for any reason’ travel insurance worth it?

Is it worth buying CFAR travel coverage?

It depends. Many vacation travelers find the ‘cancel for any reason’ coverage gives them the best protection for their financial investment in situations where their standard cancellation coverage doesn’t provide coverage.

Specifically, ‘Cancel for any reason’ lets you cancel your trip up to two days before departure and receive reimbursement for all or most of your pre-paid nonrefundable trip expenses no matter what the reason for cancelling.

This coverage costs a little more, but if you think you may have to cancel your trip for a reason that is not listed in the covered reasons for trip cancellation, you may find the cost is worth it.

What does ‘Cancel for Any Reason’ travel insurance cover?

Even when you think about and plan for anything that could go wrong on your trip – the death of an elderly relative, a sick child, a broken pelvis – you cannot predict the future. While travel insurance plans offer a range of reasons you can cancel your trip, not every eventuality is included. Think about all the travelers who lost money on trips canceled for a pandemic, for example. They could never have predicted that circumstance.

The number one reason that travelers buy travel insurance is for this coverage. Cancel for any reason, or CFAR, is considered a guarantee that you will be able to recover the majority of your trip expenses if you have to cancel.

This coverage lets you cancel your trip, and no questions asked, you’ll recover up to 75% of your trip costs. If the trip your planning is expensive, that price tag won’t look so big if you have to cancel unexpectedly.

When is ‘Cancel for any reason’ travel insurance useful?

Let’s discuss a few examples where you might find this coverage a good idea. If you find a travel insurance plan with the right amount of coverage for your trip, but you look at the covered reasons for trip cancellation and the exclusions and notice that you can’t get reimbursement under the standard trip cancellation benefit for:

• travel arrangements canceled by an airline or cruise line
• financial circumstances of the insured, a traveling companion, or a family member
• any government regulation or prohibition

These are just a few examples of trip cancellation exclusions that may be in your plan’s description of coverage.

So, what happens if you book an expensive cruise with a few college buddies, and later you discover that your boss’s child is very ill and you will have to attend a crucial business meeting in her stead? This particular situation is not covered under standard trip cancellation coverage. If you are unable to make a change to the business meeting, you could be out several thousands of your own personal dollars.

It’s situations like this where travelers appreciate having ‘Cancel for any reason’ on their travel insurance policy.

Read What travel insurance does not cover for more information.

Important notes about CFAR coverage

• It’s important to note that this coverage typically requires advance purchase within a certain number of days (usually 10-15) of making your initial trip deposit. So, if you’re going to purchase this coverage, get your vacation travel insurance plan purchased quickly.
• This coverage typically must be purchased when you purchase the travel insurance plan; it’s not something that can be added on later.
• Coverage amounts vary from 50%-100% of a traveler’s nonrefundable trip costs, and in some cases, the coverage is subject to a cancellation penalty.

See a full review of ‘Cancel for any reason’ coverage and a list of travel insurance plans that offer this coverage.

How much does CFAR coverage cost?

CFAR coverage is the best way to hedge your bets against travel uncertainty, but how much are you going to have to pay for it? While some travel insurance plans include CFAR coverage in the price, it’s more commonly managed as an add-on to the plan you select. The fee for this coverage is typically calculated as a percentage of the travel insurance policy you select.

A standard comprehensive (package) plan will cost between 4 and 10% of the total trip cost, and CFAR can add 40-60% more on top of the plan (not the cost of the trip).

Consider this example: Two 50-year-old travelers are headed to the Caribbean and they’re spending $5,000 on the trip.

• A standard package plan will cost about $250, or 5% of the total trip cost.
• A plan with the CFAR upgrade will cost around $375, which is includes the additional 50% ($125).

If their trip has to be canceled because a parent suddenly dies, however, that extra cost isn’t going to matter one bit. This couple won’t get all of their money back, but they’ll get a lot more than they would have without the CFAR coverage.

Related topics

• Covered reasons for trip cancellation
• When to buy your travel insurance plan?
• What is cancel for work reasons coverage?