What Is Cancel for Any Reason Travel Insurance?

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• Cancel for any reason insurance is a type of travel insurance add-on. 
• It allows you to cancel your trip and get reimbursed up to 75% of your costs for any reason.
• CFAR insurance generally increases your premium by 40% to 50%.

No one wants to cancel a trip, especially an expensive one. But sometimes, it’s necessary. You might get sick, have a family emergency, or just find yourself unable to take time off work.

Whatever the problem, travel insurance, particularly a plan that allows you to cancel for any reason, can help you minimize the financial damage a trip cancellation comes with. Here’s what you need to know about this type of travel insurance.

What is cancel for any reason travel insurance?

Travel insurance is a type of insurance policy that protects you from various losses that can occur while on a trip. Though most standard policies cover trip cancellation, it’s typically limited to specific scenarios — like illness or a natural disaster.

If you add on cancel for any reason (CFAR) coverage, you can cancel for virtually anything as long as you do it within the required timeframe. You typically need to cancel at least two days before the trip is scheduled to start.

“The cancel for any reason benefit means you can nix your trip for reasons other than those specifically covered in your plan,” says Jeff Rolander, director of claims at Faye, a travel insurance provider. “Adding CFAR protection to your travel insurance plan helps give you peace of mind knowing you have the ability to cancel your trip if you simply don’t feel like going.”

How much does cancel for any reason travel insurance cost?

The cost of CFAR travel insurance varies by provider and depends on the age of the travelers, the destination, the duration of the trip, and other details. You can generally expect to pay between 40% to 50% more when adding CFAR coverage.

Here’s a look at how much CFAR coverage costs at three different travel insurance providers. These quotes are for a $5,000 weeklong trip to Mexico for one person (30 years old).

Will you get a full refund if you cancel your trip?

While CFAR insurance allows you to cancel your trip for any reason, it will not reimburse you 100% of your costs if you do. Typically, insurers will reimburse 60% to 75% of your trip costs, but this percentage varies by provider.

“​​There are no CFAR policies that provide 100% reimbursement,” says Megan Moncrief, chief marketing officer at SquareMouth.

Still, 75% can make a big difference if you’re forced to cancel a trip. For example, if you paid $10,000 for a trip to Hawaii and then had to cancel because your childcare arrangements fell through, you’d only lose $2,500 — rather than the $10,000 loss you’d see without CFAR coverage.

Can you use CFAR coverage to cancel because of the coronavirus?

Standard travel insurance would likely reimburse you if you contracted COVID-19 before the trip, but not if you canceled due to exposure or fears of getting the virus while traveling.

Fortunately, CFAR does cover these instances. If you need to cancel due to COVID-related border closures, travel restrictions, a recent exposure, or even fear of exposure on your trip, CFAR will reimburse you.

“CFAR is a great option for travelers who have to cancel for reasons related to COVID, outside of contracting the virus,” Moncrief says.

Why get cancel for any reason insurance?

Life is messy and often unplanned. While many countries are reopening and reducing restrictions, that could change at any time. This is complicated without including family emergencies, illness, and other unexpected complications. Cancel for any reason insurance takes the mystery out of things.

Border closures? You’re covered. Unexpected accidents or illnesses? You’re covered. Family emergencies? Covered. You may not get a full refund depending on the policy and the guidelines. But a small premium can offer a lot of protection.

4 myths about cancel for any reason travel insurance

1. CFAR is worth it for any trip, no matter the cost

CFAR increases the cost of travel insurance quite a bit, so it may not be worth it on shorter, less costly trips or ones you’re very unlikely to cancel (like a trip to your own wedding, for example).

If you’re taking a particularly long or expensive trip, it might be worth it — especially if there’s some concern you may need to cancel. If you want the freedom to cancel due to COVID-related concerns, it can also be smart.

“CFAR is worth the money if a traveler has a very specific concern that can’t be covered otherwise,” Moncrief says. “CFAR proved popular throughout the pandemic as a way for travelers to prepare for the constantly changing travel landscape.”

2. CFAR costs a ton of money

While CFAR coverage does make your travel insurance more expensive, you’ll still pay around $100 or less in most cases. As you can see in the chart above, the typical CFAR policy costs about $60 to $130 — in addition to your basic travel insurance premium per person.

3. My credit card offers trip cancellation coverage, so CFAR is never worth it

While many credit cards do come with travel benefits, coverage is often limited in scope. The Chase Sapphire Preferred card, for example, won’t reimburse you for trips canceled due to a “change in plans or financial circumstances.” The American Express Platinum card covers cancellations due to injury, sickness, inclement weather, terrorist actions, and other reasons covered by most basic travel insurance plans. Still, in comparison, CFAR offers much wider coverage and protection.

4. You can buy CFAR at any point before your trip begins

You have to purchase CFAR coverage soon after booking your trip. Most companies require you to purchase within 15 to 21 days of putting down an initial deposit. After that point, you will be unable to add CFAR coverage to your policy.

Shop around for your CFAR coverage

If you do opt for cancel for any reason coverage, make sure to shop around for your policy. Every provider offers different plans and fees. Comparing at least a few options can help ensure you get the best rate and coverage for your needs.

Compare travel insurance quotes for free at Squaremouth.