Trip Cancellation Insurance: The Complete Guide
Trip cancellation is the benefit most people buy travel insurance for and the one with the most rules. This guide covers what it pays, every covered reason and what each one requires, the difference between cancellation and interruption, how a claim works, and the reasons that are not covered.
What trip cancellation pays
If you cancel a trip before you leave for a reason the policy lists, trip cancellation refunds 100 percent of the prepaid, non-refundable money you insured: deposits, the cruise fare, the tour, flights you cannot refund, a rented house. It pays what the suppliers keep, so if the airline refunds your fare in full there is nothing to claim for the flight, and if the cruise line keeps the whole fare the claim pays the whole fare.
Two things set the ceiling. The trip cost you put on the policy is the most it will ever pay, which is why you insure everything non-refundable and add later payments as you make them (the trip cost answer explains how). And it only pays for a listed reason. The base policy does not pay for a reason it does not name, however good the reason; that is what the Cancel For Any Reason upgrade is for.
The covered reasons
Every plan has its own list, and the lists are long and mostly the same. These are the reasons on nearly every plan we compare, with the condition each one carries and the proof the insurer will ask for.
| Covered reason | The condition | What you will be asked for |
|---|---|---|
| You, a travel companion or a family member gets sick or hurt | A doctor has to examine the person and say in writing that they cannot travel. Family is defined broadly: spouse, children, parents, siblings, grandparents, in-laws and more. | A doctor’s statement, usually on the insurer’s own form. |
| A death in the family, or of a travel companion | Before or during the trip. | A death certificate. |
| A hurricane or other disaster makes your destination uninhabitable | The hotel or the home you were going to stay in is unusable, or your airline or cruise line cannot get you there. A named storm is only covered if you bought before it was named. | News reports, the supplier’s notice, or a government order. |
| Your home is made uninhabitable | Fire, flood, burglary or a disaster in the days before you leave. | A police or fire report, or an insurance claim number. |
| Your airline or cruise line stops running for a set time | Weather, a mechanical problem or a strike shuts the carrier down for the number of hours the plan names, often 24 to 48. | The carrier’s written confirmation. |
| You lose your job | Laid off after a set length of employment, usually one to three years. Quitting or being fired for cause does not count. | A letter from the employer. |
| Your employer cancels your approved leave, or you are required to work | On the plans that list it; some cover it only for certain jobs. | A letter from the employer. |
| Jury duty, a subpoena, or military orders | You are called, and it cannot be postponed. | The summons or the orders. |
| Your tour operator or airline goes bankrupt | On plans with financial default coverage, with a waiting period after you buy, and only for suppliers not already in trouble when you bought. | Public notice of the default. |
| A terrorist incident at your destination | In the city you are going to, within a set number of days before you leave, on the plans that list it. | Government or news confirmation. |
| A traffic accident on the way to the airport | You or your car were involved and you missed the departure. | A police report. |
| You are quarantined, or your passport is stolen | On the plans that list them. | The order, or the police report. |
The one that matters most is the first. Illness and injury are the reason behind most cancellation claims, and the rule is simple: a doctor has to examine the person, before the departure date, and say in writing that they cannot travel. A phone call, a note written after the fact, or your own judgment that you were too sick will not do it. If you feel ill in the week before a trip, see a doctor and ask for the insurer’s form.
Cancellation and interruption
Trip cancellation covers you before you leave. Trip interruption covers the same reasons after you leave, and every package plan includes both.
| Trip cancellation | Trip interruption | |
|---|---|---|
| When | Before you leave | After you leave |
| What it pays | 100 percent of the insured prepaid, non-refundable trip cost | The unused part of the trip, plus the cost of getting home early, or of catching up if you are delayed on the way |
| The limit | The trip cost you insured | 100 to 175 percent of the insured trip cost: 150 on most plans, 175 on Generali Premium, 100 or 125 on the basic plans |
| The reasons | The same list, on both | The same list, plus a few that only make sense on the road, such as a family member at home falling ill |
Interruption pays more than 100 percent on most plans because a last-minute flight home costs more than the flight you had booked. A plan with 150 percent interruption on a $6,000 trip can pay up to $9,000: the unused hotel nights and tours, plus the one-way fare home.
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| Step | What to do | Why it matters |
|---|---|---|
| 1. Cancel with every supplier as soon as you know | The airline, the cruise line, the tour operator, the hotel. | The policy pays what the suppliers keep. Cancel late and the penalties grow, and the insurer only pays the penalty that applied on the day you should have cancelled. |
| 2. Get the proof the same week | The doctor’s form, the death certificate, the employer’s letter, the carrier’s confirmation. | A doctor who examined the person in person, before the departure date, is what the claim turns on. It is the first thing the insurer checks. |
| 3. Collect the money trail | Booking confirmations, receipts, and each supplier’s cancellation confirmation showing what it refunded and what it kept. | The claim pays the difference between what you paid and what came back. |
| 4. File online, then follow up | Most insurers take claims on their website and ask for the documents as uploads. Note the claim number. | Answer requests for more documents quickly; a claim waits on you, not the insurer, once it is filed. |
A claim moves quickly when the documents are complete and stalls when they are not. The doctor’s form and the supplier’s cancellation confirmations are the two things to get right on the day.
What is not covered
Changing your mind. Nerves about a destination, or a news story about it. A friend or relative who drops out. A work conflict that is not a required transfer or a cancelled leave on a plan that lists it. A storm that already had a name when you bought the plan. A price drop, a better deal, or a visa or passport you did not get in time. A condition that changed inside the look-back period, unless you have the pre-existing condition waiver. For any of those, the base policy pays nothing, and the Cancel For Any Reason upgrade pays 75 percent if you added it within 14 to 21 days of your first trip payment and cancel at least two days before departure. The exclusions answer has the full list.
What the plans say
Every one of the 54 plans on the comparison pays 100 percent of the insured trip cost for a covered cancellation, and nearly every one covers sickness, injury and death of the traveler, a travel companion or a family member on a doctor’s say-so, a destination made uninhabitable by a disaster, jury duty, and a carrier shut down by weather. Interruption pays 150 percent of the trip cost on most plans, 175 percent on Generali Premium, and 100 or 125 percent on the basic plans (Generali Standard, Trawick Pathway Essential, Tin Leg Economy, Seven Corners Basic). The reasons that differ by plan are job loss, cancelled leave, financial default, terrorism and quarantine; the policy document for the plan you are looking at is the only place to check them, and the comparison shows it before you buy.
Questions people also ask
What is a covered reason for trip cancellation?
A reason on the policy’s list: you, a travel companion or a family member gets sick or hurt or dies, a hurricane makes your destination uninhabitable, your home is damaged, your airline stops running for a set number of hours, you lose your job, you are called for jury duty or military service, your tour operator goes bankrupt, a terrorist incident at your destination, a traffic accident on the way to the airport. Each plan’s list is in its policy document, and the reasons above are on nearly every one.
Does travel insurance cover cancelling because I got sick?
Yes, if a doctor examines you and says in writing that you cannot travel. That is the single most common cancellation claim. The condition has to be new or unexpected; a condition that changed in the look-back period before you bought is only covered with the pre-existing condition waiver.
Does travel insurance cover cancelling because a family member is sick?
Yes, on nearly every plan we compare, as long as a doctor says the illness is serious enough to keep you home or to need you there. Family is defined broadly and usually includes in-laws and grandparents. It does not have to be someone travelling with you.
How much does trip cancellation pay?
100 percent of the prepaid, non-refundable trip cost you insured, minus whatever the suppliers refunded. If you insured $5,000 and the cruise line kept $3,500, the claim pays $3,500. That is why the number you put on the policy matters: it is the ceiling.
What is not a covered reason?
Changing your mind, nerves about a destination, a friend who drops out, a work conflict that is not a required transfer, a storm that already had a name when you bought, a price drop, a visa you did not get. For all of those you need the Cancel For Any Reason upgrade, which pays 75 percent.
Does trip cancellation cover the flights I booked with points?
Only what you paid in cash: the taxes and fees. Some plans will pay the fee to redeposit the points, up to a small limit. Points themselves are not a covered loss.
Is trip cancellation the same as trip interruption?
No. Cancellation is before you leave and pays the trip cost. Interruption is after you leave and pays the unused part of the trip plus the cost of getting home, up to 100 to 175 percent of the trip cost depending on the plan. Every package plan includes both.
Related: When should I buy travel insurance? · Can I get travel insurance if I have a pre-existing condition? · Does travel insurance cover flight delays? · What does travel insurance cover?
Plan facts on this page (covered reasons, interruption percentages, the doctor’s-statement rule, the two-day rule for Cancel For Any Reason) were checked against the policy documents for the 54 plans on the CoverTrip comparison and the insurers’ plan pages on 12 and 13 September 2026.
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Damian TysdalDamian Tysdal is the founder of CoverTrip and a licensed travel insurance agent since 2006. He believes travel insurance should be easier to understand, and started the first travel insurance blog in 2006. About CoverTrip.