Trip Cancellation Insurance
Trip cancellation insurance is coverage that reimburses travelers for prepaid, non-refundable trip expenses if they must cancel their trip due to covered reasons. Common covered reasons include illness, injury, death of a family member, or severe weather.
Example
“When John broke his leg two days before his $5,000 cruise, his trip cancellation insurance reimbursed him for the non-refundable costs.”
Memory Tip
Cancellation = Can't-go Protection - it protects when you can't go on your planned trip.
Why It Matters
Trip cancellation insurance protects travelers from losing thousands of dollars in prepaid expenses when unexpected events force them to cancel trips. With average vacation costs ranging from $3,000-$15,000 per family, this coverage can prevent significant financial losses from unforeseen circumstances beyond travelers' control.
Common Misconception
Many travelers believe they can cancel trips for any reason and get reimbursed, but standard trip cancellation insurance only covers specific listed reasons like illness, injury, or death. 'Cancel for Any Reason' coverage is a separate, more expensive option that provides broader but limited reimbursement.
In Practice
Maria books a $4,500 African safari six months in advance and purchases trip cancellation insurance for $315. One month before departure, she's diagnosed with pneumonia and cannot travel. The insurance reimburses her full $4,500 in non-refundable costs, saving her from a total financial loss while she recovers from her illness.
Etymology
The term evolved from basic 'trip insurance' as the travel industry grew in the 1970s. 'Cancellation' comes from Latin 'cancellare' meaning to cross out or annul, reflecting the act of voiding travel plans.
Common Misspellings
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