Trip Cancellation Insurance and Your Credit Card
If you pay for your vacation with your credit card, you may automatically get trip cancellation insurance
If you're about to spend thousands for a business trip or vacation, then you might want to invest in some trip cancellation insurance -- just in case.
We've all heard of flight insurance. Well, this is similar, but it's a more general category of protection. It's a good idea, given life's uncertainty; and interestingly enough, your credit card may automatically cover you.
Needless to say, there are a few caveats to that statement, so let's take a closer look.
The Insurance Itself
Most people aren't aware that this form of coverage even exists, and fewer still know how to take advantage of it when they need to. Also known as trip interruption/cancellation insurance, it can apply to everything from your cruise line failing or an airplane breaking down to interruptions due to injury or illness.
Some versions of cancellation insurance also cover you if a sudden conflict arises that you can't resolve, or if you lose your job, or even if you just decide not to go. Those policies tend to be expensive, though, and your credit card company probably won't provide them automatically.
Speaking of Which...
Automatic cancellation insurance generally comes into play when you purchase the entire trip on your credit card, assuming your card offers such coverage. Side trips, such as separately-paid excursions during a cruise, may also be covered.
Naturally, you should check your card terms before assuming that you have any such coverage at all. But the converse of that statement is equally true: don't waste money buying third-party insurance unless you know for sure your card doesn't cover trip interruption or cancellation.
If you can't find the coverage mentioned in your terms of service, just call customer support and ask about it.
How to Claim Coverage
If any part of your trip is cancelled or interrupted for any reason, immediately call your credit card company and let them know, because there are time limits on most claims.
At the very least, as a U.S. resident you should be refunded for goods and services (travel tickets, cruises, tours, rental cars) if you don't receive them. That's the law, based on the U.S. Fair Retail Credit Billing Act. However, expect a delay, because the credit card company will need to investigate your claim.
Be Absolutely Sure!
Interruption/cancellation insurance is a privilege that your credit card company may or may not offer, and even then, they'll only cover items purchased with the card itself. Never assume that you have automatic coverage! But again, never assume that you don't.
So review your coverage carefully, just in case. You don't want to be caught out just because your credit card trip cancellation insurance isn't up to snuff.
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