As spring break approaches and people plan their trips, nonrefundable travel plans can lead to the loss of hundreds of dollars. However, the right credit card with travel insurance can help in case of cancellations. Many travel rewards credit cards have high annual fees, but they are worth it for the perks.
Coverage Depends on the Card
Travel insurance coverage varies depending on the credit card you have. High-end cards with annual fees of $500 or more usually have the most extensive coverage, but some mid-tier cards have good insurance perks too.
Common coverage includes trip cancellation or interruption, trip delay, lost luggage reimbursement, delayed baggage insurance, and emergency evacuation and transportation. There are limits to how much you can claim and how often you can claim, so it’s important to read your card’s benefits guide to understand the details.
Pay with the Right Card
Credit card travel insurance usually only applies if you pay for your trip with that card. If you pay with multiple cards or another card, you may not be covered. The exception is when you use rewards, but they must be from the same issuer as your travel card. There are time limits for filing a claim after a cancellation, so file as soon as possible.
Covered Situations
Most travel insurance policies cover accidental bodily injury, sickness, or death of the traveler or their companions. They also cover inclement weather severe enough to prevent a reasonable person from traveling, change in military orders for the traveler or their spouse, terrorist action or hijacking, and orders that cannot be postponed or waived.
The list of covered situations can be vague, so it may be worth trying to file a claim even if your reason isn’t directly listed.
Not Covered
Some of the most common reasons for canceling travel are not covered by credit card travel insurance. Such reasons include changing your mind or plans, changes in your financial situation, and canceling due to a pre-existing medical condition. You are also not covered if you are traveling into a warzone or against a physician’s advice.
If part of your travel is canceled by a common carrier, you may not be covered. You cannot claim reimbursement from your card’s travel insurance if you have already been reimbursed by another source.
Choosing the Right Card
When choosing a travel rewards credit card, it’s essential to look beyond just the rewards program. Check for travel insurance coverage and understand the limitations and restrictions that come with the coverage.
Be sure to compare cards from different issuers to see which one offers the best benefits for your needs. Remember to factor in the annual fee when comparing cards, as it may be worth it for the additional perks.
Filing a Claim
If you need to file a claim, contact your credit card company’s customer service or claims department. They will guide you through the process and provide you with the necessary forms and documentation requirements. Keep records of your travel plans, receipts, and any documentation related to your claim. Be sure to file your claim as soon as possible, as there are usually time limits for doing so.
So, credit card travel insurance can be a lifesaver when it comes to cancellations and unexpected events. However, it’s crucial to understand the coverage and restrictions that come with your card’s benefits. By choosing the right card and paying with it, you can enjoy peace of mind and avoid losing money due to nonrefundable travel plans.
