There are many reasons why you might need to cancel a scheduled trip. But when it comes to travel insurance coverage, not all reasons are created equal.

Many potential scenarios can lead to a trip being canceled and while some may be covered by the travel insurance you purchased, others may not. When purchasing travel insurance, smart and savvy travelers should understand the different types of cancellation coverage. They should also understand which situations they apply to, so they can decide on the type of coverage that is best suited to their upcoming trip.

Having to cancel a trip is disappointing enough. You don’t want your disappointment compounded by the discovery that you won’t be reimbursed for a canceled trip because you don’t have the right kind of coverage. Generally speaking, there are two main categories of cancellation coverage: Trip Cancellation vs Cancel For Any Reason (CFAR).

What is trip cancellation?

Trip cancellation coverage is typically included as part of most comprehensive travel insurance policies. It can reimburse you for any prepaid, nonrefundable trip costs in the event that you cannot go on a planned trip.

So, what are the covered reasons that trip cancellation insurance may reimburse you for? It covers unforeseen events that may cause you to cancel your trip prior to your date of departure. Examples of these include the illness, injury or death of you, a family member or traveling companion, unforeseen natural disasters, inclement or severe weather that affects your journey, a terrorist incident, or jury duty, and other unforeseeable events. In each of these cases, you’d be able to make a claim for your trip cost as part of trip cancellation coverage.

In all these instances, you may only be reimbursed for your nonrefundable trip cost. (In other words, for the things you’ve already paid for prior to your scheduled departure date.) For example, if you were paying your travel supplier in installments and had only made your first trip payment or initial trip deposit at the time you canceled, you would not get the entire trip cost reimbursed, only what you had already paid for. Furthermore, if you had booked airline tickets that were refundable from the travel supplier or airline, you would have to seek a refund from them, rather than make a claim on your insurance policy.

As mentioned before, trip cancellation coverage comes as a standard part of most travel insurance policies. These policies can typically be customized to also include benefits such as emergency medical coverage, trip interruption, trip delay coverage, and baggage loss and delay — all of which may reimburse you provided you make a claim for a covered reason.

What’s the difference between trip cancellation and Cancel For Any Reason?

If the time has come for you to purchase insurance, you may be wondering more about trip cancellation vs Cancel For Any Reason (CFAR) coverage. Which one is right for you? The main difference you’ll want to be aware of when purchasing travel insurance is the reasoning behind making your trip cancellation claim.

As outlined above, basic trip cancellation coverage comes with restrictions on the covered reasons for making a trip cancellation claim. On the other hand, Cancel For Any Reason coverage has virtually no restrictions — you can, quite simply, cancel for any reason and expect to receive reimbursement for a percentage of your nonrefundable trip costs. This applies even if you simply change your mind.

In essence, CFAR is about preference and whether or not you’ll change your mind about going on a trip. Standard trip cancellation coverage is about unforeseen events that prevent you going on a trip you definitely want to go on.

What are some scenarios in which travelers may opt for Cancel For Any Reason coverage? Perhaps you’re not entirely sure if a business trip will go ahead due to a scheduling conflict, or maybe you feel anxious about political unrest in your destination and want to be able to back out at the last minute. Or you think you may have a change of heart about traveling. These are all situations where standard trip cancellation coverage would not reimburse you, whereas CFAR coverage most likely would.

One situation where Cancel For Any Reason coverage is particularly helpful is around COVID-19. While some comprehensive travel insurance policies, like those offered by battleface, do provide coverage for cancellations due to COVID-19 sickness, not all reasons are covered. If you’d like to have maximum flexibility and the option to cancel a trip at the last minute due to a rapidly changing situation in your destination, such as COVID-related travel restrictions or an increase in COVID cases, CFAR coverage may be right for you.

Should I purchase CFAR coverage? And how much does it cost?

Cancel For Any Reason coverage offers travelers peace of mind. For that reason, it costs more than standard trip cancellation coverage. In addition, there are several dependencies associated with CFAR coverage. These include how far in advance of your departure date you cancel your trip, and when you purchased your policy. It’s also important to note that this type of coverage may not be available in every US state, and generally pays a percentage of your non-refundable trip cost.

The exact cost of Cancel For Any Reason coverage will vary by travel insurance provider, specific policy, and your particular trip details. Purchasing this coverage from battleface will add to your total premium, but remember, CFAR coverage is all about having maximum flexibility and peace of mind. For some travelers, that’s impossible to put a price on. While Cancel For Any Reason coverage isn’t right for everyone, it’s smart when you’re considering your options with comprehensive travel insurance plans to look into whether it may be an appropriate addition to your trip coverage.