Flight chaos grows as TSA shortages, storms hit. What to know about trip cancellation insurance.

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With severe weather and ongoing TSA staffing shortages, air travelers nationwide are experiencing major disruptions and delays.

The partial government shutdown could even force some smaller airports to close in the coming weeks, according to a Trump administration official.

Transportation Secretary Sean Duffy warned Thursday that travel chaos will look like “child’s play” if the shutdown isn’t resolved soon, as TSA absences spike in airports across the U.S.

With standard flight delays and cancellations, you can typically receive reimbursement or have your flight rebooked by the airline. However, unless you have travel insurance, there may be no recourse available if you miss your flight because you don’t make it through long airport security lines fast enough.

In addition, airlines won’t cover other prepaid and nonrefundable bookings you’ve made and missed because of a flight delay or cancellation. This is where trip cancellation insurance and cancel for any reason (CFAR) insurance can come in handy.

Learn more: Travel insurance: What it covers, costs, and how to choose the right policy

What is trip cancellation insurance?

Trip cancellation insurance usually applies if your trip is canceled or rescheduled for a covered reason listed on your policy. Keep in mind that covered reasons may vary by insurance provider and plan, so it’s best to compare policies to ensure you’re covered for the reasons you want.

• Serious illness or injury: An illness, injury, or other medical condition must be disabling enough to warrant a trip cancellation. You may also need advice from a doctor who recommends that you cancel your trip.

• Death of a family member: You can often cancel your trip for this reason if the death occurs during your policy coverage period.

• Severe weather disrupting travel: You may be able to cancel your trip if your travel carrier can’t get you to your original itinerary destination within a reasonable time of your originally scheduled arrival time. For example, you may be able to cancel if you can’t arrive within 24 hours of your original arrival time.

• Jury duty or legal obligations: You may be able to cancel if you have legal proceedings scheduled during your trip that aren’t part of your daily job responsibilities.

• Certain work-related emergencies: You may be able to cancel if you lose your job, have a work-related emergency, or you’re directly involved in a merger or acquisition.

• Changing your mind: Trip cancellation insurance won’t cover you if you simply decide you don’t want to travel.

• Minor illnesses: Only significant illnesses and injuries are typically covered by trip cancellation insurance.

• Known events: Known or foreseeable events, such as a hurricane you knew about before traveling, aren’t often covered by travel insurance.

• Fear of travel: Being afraid to travel isn’t a covered reason under standard travel insurance policies.

Learn more: What does travel insurance cover, and do I need it?

It depends on your travel insurance policy, but here are some common reimbursable expenses.

If you have to cancel your trip for a covered reason, you should have any prepaid and nonrefundable flights reimbursed by your policy, up to the policy limit. If your flights are refundable, you can just cancel them yourself to receive your reimbursement.

Similar to nonrefundable flights, you should be reimbursed, up to your policy limit, for prepaid and no-refundable hotel bookings if you cancel your trip for a covered reason.

Many tours and cruises are nonrefundable, so it makes sense to consider trip cancellation insurance if you plan to book one of these nonrefundable options.

In general, if you include them in your overall trip expenses on your travel insurance policy, event tickets should be covered if they’re nonrefundable.

Prepaid excursions should be reimbursable under your trip cancellation coverage if the costs were included in your policy and the excursions are nonrefundable.

Here are four tips to keep in mind as you navigate the trip cancellation insurance process.

Travel insurance, including trip cancellation insurance, typically only applies if you’ve purchased it before a qualifying event occurs. For example, you need to have purchased your policy before you get sick and have to cancel your trip.

In addition, getting the timing right is essential throughout the claims process. In many cases, you have to contact your insurance provider within a certain period of time after a qualifying event occurs, then you have to submit documentation along with your claim in a reasonable amount of time.

When it comes to travel insurance, it’s best to keep all your receipts in case you need to submit a claim. For trip cancellation insurance, this could include keeping receipts for flights, hotel bookings, cruises, and other expenses.

If you have to submit a claim, your insurance provider is going to request these documents, so it makes sense to be prepared.

Once you’ve submitted your claim, including the required documentation, your insurance provider will review it. Be ready to respond to any emails or phone calls and to provide more documentation if needed. There’s no set time period for how long the review will take, but it may take days or weeks. You can typically check the status of your claim through the insurance provider’s website.

You can usually choose how you would like to receive your claim reimbursement from a variety of payment options. Common payment methods include direct deposit and mailed checks.

CFAR coverage isn’t typically included in standard travel insurance policies. You would have to pay for this upgrade if offered.

The primary reason to add CFAR coverage is to cancel your trip for any reason, including reasons not normally covered by trip cancellation insurance. For instance, you may be able to cancel simply by deciding you no longer want to travel.

That sounds like a great add-on, but the downside is that you typically receive only 50% to 75% of your trip costs in reimbursement. So, you will still lose some of your prepaid, nonrefundable expenses, but not all.

You also can’t add CFAR coverage whenever you want. Depending on the travel insurance provider, you may have to buy this coverage within a few weeks of your initial trip deposit. Otherwise, you may not be able to buy it at all.

The biggest CFAR limitations include:

• Must cancel within the required time frame: Depending on the policy, you may have to use this coverage at least 48 to 72 hours before your trip’s scheduled departure.

• Percentage of reimbursement: You will typically receive only 50% to 75% of your total covered trip costs.

• Extra cost: You have to pay extra to add this coverage to your policy.

• Uncertain plans: Safety concerns or potential family or work obligations could throw a wrench into your plans, but CFAR coverage could help you recoup a portion of your trip costs.

• Complex international trips: Trips with multiple flights, cruises, and/or hotel bookings may have itinerary changes that don’t align with your preferences, so having CFAR coverage gives you more flexibility.

• Personal risk tolerance: If you simply want some coverage for any type of scenario so that your trip costs aren’t completely wasted, CFAR coverage may make sense for you.

Learn more: Is travel insurance worth it? 

Trip cancellation insurance is not the same as trip interruption insurance. Here’s the easiest way to differentiate between the two:

• Trip cancellation applies before you depart on your trip.

• Trip interruption applies after your trip has started.

Learn more: How to compare travel insurance to choose the right policy

Trip cancellation insurance is typically purchased as part of a travel insurance policy, which also includes other coverage, such as trip interruption insurance. In general, travel insurance costs between 4% and 10% of your total trip price.

That means if your trip costs $10,000, a travel insurance policy may cost between $400 and $1,000.

However, the actual cost of your policy can vary depending on various factors, including the type of coverage you purchase, the travel insurance provider, total trip cost, traveler age, and coverage limits.

Adding upgrades, such as CFAR coverage, will raise your insurance premium.

Note: Many of the best travel credit cards provide trip cancellation insurance as part of their built-in benefits. If yours does, you may not need to purchase a separate travel policy. However, not all credit card travel insurance is as robust as a standalone policy.

Learn more: How credit card travel insurance works

Trip cancellation insurance does not cover any cancellation. It only reimburses you for covered reasons, as listed in your policy.

CFAR coverage lets you cancel your trip for any reason.

You will not receive a full refund from CFAR coverage. Instead, the standard reimbursement amount is between 50% to 75%.

Airline cancellations are not the same thing as using trip cancellation insurance. Depending on the situation, you may not be able to receive reimbursement from your insurance if you accept a travel voucher from your travel carrier for a flight cancellation.

Trip cancellation insurance makes sense if:

• You have high nonrefundable trip costs: If you can’t cancel most of your travel bookings for full refunds, it’s worth considering a travel insurance policy to reimburse you if you need to cancel for a covered reason.

• You have complex itineraries with cruises and tours: Cruises and tours may have strict cancellation policies, so it may make sense to purchase trip cancellation insurance.

• Your trips are booked far in advance: Booking trips far in advance increases the risk of unforeseen events. An adequate travel insurance policy can protect you during the time you initially booked until your departure date.

• You have international itineraries: International travel is often more expensive than traveling domestically, which increases your financial risk if something were to happen.

• In general, trip cancellation insurance will cover you for severe illnesses or injuries that prevent you from traveling, as well as other covered reasons as stated in your policy documents. This could include a family birth or death, severe weather, natural disasters, and more.

• CFAR coverage is an optional upgrade that may be useful if you value flexibility with your travel insurance. Since you can cancel for any reason with this add-on, you don’t have to worry about only canceling for a covered reason. However, your reimbursement with CFAR coverage is typically only 50% to 75% of the total.

• Trip cancellation insurance is an essential part of any travel insurance plan, but you must carefully read the exclusions of any policy you choose. Standard policies won’t cover you if you change your mind on traveling, have already started your travel, are afraid of traveling, or for many other excluded reasons.

Tim Manni edited this article.