There are travelers who struggle with their travel insurance, of all things.
You are so excited about your upcoming trip that you cannot imagine any reason why it should not take place or be canceled. That is only human—and so understandable. And of course, that is how it should be.
However, once we come to our senses, the topic of travel insurance should immediately come to mind. While you can still take out international health insurance the day before your trip, you should take out travel cancellation insurance as soon as you book your trip in order to immediately benefit from the insurance coverage.
Now, one might assume that everyday work in a travel agency consists exclusively of wonderful travel stories. That's true, but unfortunately there are also stories like this one:
- A valued customer books a long-distance trip at short notice for over €15,000. Although he was certain that nothing could happen in the next two weeks before departure, he booked travel cancellation insurance for himself and his partner. Two days later, through no fault of his own, he has a car accident, has to go to hospital and, after a long convalescence, into rehabilitation. Due to the short notice, the cancellation fee for the trip was already 80%. He received €3,000 (= 20% of the trip price) from the tour operator and the 80% cancellation fee from his travel cancellation insurance.
- During her South Sea cruise, the father of one of our customers, who had stayed at home, fell seriously ill and died within two days. The trip interruption insurance covered the costs of the complicated return journey for the customer and her husband from a very remote South Sea island to their family in Germany and also reimbursed the portion of the travel costs that the two were unable to use due to their premature return.
- A family books a trip during the winter for the following fall vacation. In the summer, one of the children becomes chronically ill. The entire family can cancel the trip and accompany the sick child in the hospital. The cancellation costs are covered by travel cancellation insurance.
- During the trip, a customer falls ill with gastroenteritis shortly before the return journey. On the day of her return, the local doctor certifies that she is unfit to travel. She has to extend her trip and recover from her illness on site. The trip interruption insurance covers the costs of the extension and the rebooked return flight. Not only for the customer, but of course also for her co-insured husband.
These are just four examples of many that show you why it is important to take out travel cancellation insurance.
I will gradually expand the list as important events are added. This will give you an idea of how important travel cancellation insurance/travel interruption insurance can be for you.
Without taking out such insurance, you usually have no choice but to bite the bullet and pay the cancellation fees or transfer the trip to a replacement person for a rebooking fee. In medical emergencies, however, you often have better things to do than look for replacement persons.
In addition to essential international health insurance, travel cancellation insurance in conjunction with travel interruption insurance is essential to protect you from financial loss.
The jungle of travel insurance offers is overwhelming if you are a layman looking for good travel insurance. It is best to take out your travel insurance where you book your trip. Your travel agency knows you and your trip best and can offer you the right insurance.
These are the most important questions and answers about travel cancellation insurance and travel interruption insurance.
To make it easier for you to find the perfect travel insurance policy, I have put together some advice and tips for you here.
1. What is the purpose of travel cancellation insurance and travel interruption insurance?
A lot can happen between booking your trip and the trip itself. Life is colorful and varied. Many events happen exactly when you least need them to. No, I'll go further: hardly anyone ever needs to be ill.
But then it happens: you come down with a gastrointestinal infection, or a parent suddenly falls seriously ill, or your child breaks an arm during physical education class.
How fortunate that you have a competent travel agency that recommended good travel cancellation insurance and travel interruption insurance along with your trip: your agency will cancel the trip for you, and after a little correspondence, you will receive a full refund of the trip price*.
As always, the principle of insurance only works if it is taken out for an event that COULD POSSIBLY occur, i.e., that is not expected at the time of taking out the policy.
The basic requirements are as follows:
– The event has not yet occurred at the time the insurance is taken out and was not expected to occur.
– The event affects you or a "person at risk" named in the insurance terms and conditions. These are usually first-degree relatives.
– The event makes it unreasonable for you to travel.
What is the difference between travel cancellation insurance and travel interruption insurance?
Travel cancellation insurance reimburses your cancellation costs incurred at the time of cancellation of your travel contract before departure. This is also referred to as "contractually owed cancellation costs." It is important that the cancellation is made in good time and for an "insured reason":
Period of validity: Date of travel booking = conclusion of insurance ——–> Start of trip
Travel interruption insurance covers the costs incurred if you have to cancel, interrupt, or extend your trip. In addition to the additional costs, the insurance also reimburses you for unused vacation services.
Validity period: Start of trip ——–> End of trip
2. For what reasons can travel cancellation insurance be claimed?
Please read the terms and conditions of your travel cancellation insurance provider (a typically German word :-)), to find out which "insured events"are covered.
Always bear in mind that a lower price automatically means less coverage. Therefore, focus your attention on the content of the insurance policy, not just the price.
Important: Travel cancellation insurance only covers events that have not yet occurred at the time of travel and were not foreseeable.
While cheaper insurance policies only cover accidents and illness, good insurance policies also cover events such as pregnancy, unemployment, court summonses, and much more.
It does not cover cancellation costs for illnesses that already existed at the time of travel. Please contact me if you have a pre-existing condition that could be a reason for cancellation. We have special insurance for this case, which we can offer you under certain circumstances.
3. What costs does travel cancellation insurance cover?
If you cancel a flight or an entire trip, cancellation fees will apply. These can be found in the general terms and conditions of your tour operator or in the fare conditions for your flight. In many cases, the shorter the notice period for cancellation, the higher the cancellation fees.
A small example:
1. Your total travel price is: €1,000 (Let's assume you have already paid the entire travel price.)
2. The cancellation fee at the time of cancellation according to the tour operator's terms and conditions: up to 7 days before arrival = 80%;
80% of €1,000 = €800.00. Your cancellation costs are therefore €800.
3. If you have already transferred the full travel price (=100%, i.e. €1,000) to the tour operator, the tour operator will retain 80% (= €800) and transfer 20% back to you.
4. And now your travel cancellation insurance comes into play. Of course, you will have to deal with a little paperwork, but if everything is in order, you will be reimbursed 80%, i.e. €800.00*, after submitting all certificates and documents and passing the positive review.
If you wish to reschedule your trip within a foreseeable period of time, in a few cases—to be confirmed by the insurance company—it may also be possible to rebook for a later travel period. The travel cancellation insurance will then cover the additional costs for the rebooking.
The calculation is somewhat more complicated for travel interruption insurance:
Suppose you interrupt your trip for an insured reason 5 days before the end and, for medical reasons, are only fit to travel again 3 days after the booked end of the trip. Travel interruption insurance will then reimburse you for 5 days of travel (which you were unable to use) as well as the additional costs for the rebooked return trip*.
4. When should travel cancellation insurance be taken out?
Take out your travel cancellation insurance and travel interruption insurance directly when you book your trip. Once your trip is firmly booked, cancellation fees will apply.
Many insurance companies offer you the option of taking out a policy within 14–21 days of booking your trip. Please bear in mind that your trip is not covered between the time of booking and the time of taking out insurance. If you think back to my first example above, you would be left with €12,000 in cancellation fees if you were involved in an accident two days after booking your trip.
It is negligent if someone advises you to take out travel cancellation insurance weeks after booking your trip. This is not in your best interest. Stay away from this provider.
As with all insurance policies, travel insurance must be taken out before the insured event occurs. If you wish to make a claim, you must provide very detailed evidence to support your claim.
You can take out travel interruption insurance in combination with travel cancellation insurance.
5. Who is insured?
Individual insurance policies only cover the policyholder.
In the case of family insurance, the insurance cover also applies to co-insured persons, such as spouses and biological children. In cases where the family structure is not entirely clear, pay attention to your insurer's definition of "family": some only consider people to be family if they have the same registered address. If they are spouses and not cohabiting, etc. Every insurance company sees it differently.
However, you can also claim on the insurance if an "insured event" occurs to a person at risk. This could be your parents, your siblings, or even your children. You can find out who is covered under the "persons at risk" section of your travel insurance policy.
6. What risks are not covered?
Of course, the insured reasons listed under 2. are important.
However, there are a lot of rumors about what travel cancellation insurance can and cannot cover. I have recently come across a lot of misinformation about insured events, especially in online travel forums.
Terrorism and wars, for example, are not covered. So if there is an attempted coup in Istanbul and you want to cancel your trip, neither travel cancellation insurance for those who have not yet traveled to Turkey nor travel interruption insurance for those who are already there and want to cut their trip short will apply. Damage caused by war or war-like events is also not covered.
Strikes and industrial action are also not covered. So if Lufthansa goes on strike again, this falls under "force majeure" and is not covered by travel cancellation insurance or travel interruption insurance.
If you have a chronic or existing illness, it is also not insured. A "new" illness must not exist or be expected at the time the insurance is taken out if it is to be covered.
If you get divorced or separate from your travel partner for another reason and no longer wish to travel together, you can cancel the trip, and travel cancellation insurance or travel interruption insurance will reimburse you, but not the cancellation fee.
Underinsurance: I often encounter travelers who have booked their trip online and ask me for help when problems arise. Just recently, a family had to cancel their trip for an important reason and asked me to help them organize the settlement. For data protection reasons, I can only take action if the trip was booked with me. The family was under a lot of pressure due to the sudden serious illness of one of their children, so I took a look at everything anyway. Unfortunately, it quickly became apparent that the family was underinsured. While the trip had cost over €10,000, the cancellation fees amounted to over €6,000. However, the father had only taken out travel cancellation insurance for €2,500. The cheap insurer from the internet that the father had booked with naturally only paid the €2,500. This was very upsetting for the whole family.
Ensure you have adequate insurance coverage! Only a professional can advise you appropriately in this regard.
The insurance terms and conditions of each insurer also include a section entitled "Not insured," which you should also study carefully.
7. Travel insurance or annual insurance?
Well, that depends on your personal travel habits. If you travel frequently throughout the year for business and pleasure, it is definitely worth taking out travel insurance that covers both business AND private trips all year round. I would even recommend travel cancellation and curtailment insurance in combination with international health insurance. This will quickly pay for itself after two or three trips.
As a self-employed person who travels a lot, I would even offer you another insurance policy that covers risks that only self-employed people face. I will write about this again in another chapter.
8. With or without excess?
In general, I recommend travel insurance for cancellation and interruption without excess, so that you will be reimbursed for the entire cancellation costs owed in the event of an emergency.
If you take out travel cancellation insurance with an excess, this means that you will have to pay 20% of the claim yourself. If we stick with example number 1, this amounts to a contribution of €2,400. Of course, the premium is also slightly lower. But if a claim occurs, you want to be as well covered as possible, and €2,400 can hurt.
9. Where is the best place to book insurance?
Book your travel insurance with the travel agency where you booked your trip. Your travel agent usually knows more about travel insurance than a "normal" insurance agent. Your travel agent has many years of experience with travel claims and knows exactly which insurance covers what and when. And, of course, which does not.
Travel insurance is now available as an add-on to all kinds of services: many credit cards include travel insurance, travel portals offer travel insurance "at the click of a button," and even discount stores offer bargain deals.
Always bear in mind that the insurance must suit you and your trip and should therefore be selected individually. NO online portal can do this. Consult an independent travel agent who can offer you insurance that suits you and your trip.
10. What to consider with travel cancellation insurance included in your credit card
This is a very detailed topic in its own right, which I will address exclusively and in great detail in another article. Please always bear in mind that the insurance included with your credit card is only an "add-on" and, for that reason alone, cannot offer the same scope of coverage as specialized travel insurance.
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11. Which parameters determine which travel cancellation insurance you should choose?
Marital status: Check whether you need to take out insurance for one person or whether family insurance is also possible if you are traveling with family members. This can have a positive effect on the insurance premium.
Travel price: The premium for travel cancellation insurance is based on the price of the trip. Make sure that you are not underinsured.
High-risk individuals: Which individuals in your family are close to you and would be dependent on you in the event of an unforeseen event?
Age: Pay attention to the age limit. From the age of 65 (varies from insurance company to insurance company), there are surcharges.
Trip duration: Most insure trips of up to a maximum of 45 days per trip. For long-term trips, there are other specialists.
Special insurance is also available for the following offers, which I will discuss separately in a later article:
Ticket insurance
Seminars
Business trips
for the self-employed
For general questions about insurance, please comment below the article or send me an email at welcome@inventia.de.
Yours, Stephanie Gräf
*Please refer to your insurance provider's terms and conditions for restrictions and exclusions (e.g., service fees, rebooking fees, etc.).
Note from inventia: When researching and writing this article, I focused on ensuring high quality and professional expertise in terms of both content and form. Please bear in mind that every insurance company sets its own terms and conditions, and this article therefore does not claim to provide comprehensive advice. We can only advise you directly and individually in order to find the right insurance for you. As travel agents, we are not insurance brokers and only take out insurance policies for you if you have also booked the corresponding trip with us. If you only need insurance, we would like to draw your attention to our online offering, which we are constantly expanding.
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Yours, Stephanie Gräf
