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You can plan a trip down to the minute with military precision. But even the most seasoned travelers know that things often can, and do, go wrong on the road. Luckily, many travel rewards credit cards offer a benefit called trip cancellation insurance that covers you in case you need to change your plans or cancel altogether. Here's what you need to know about trip cancellation insurance, the credit cards that offer it, and how to make the most of it.
Credit Cards That Offer Trip Cancellation Insurance
Chase Sapphire Preferred® Card: With this card, if your trip is canceled or cut short by sickness, severe weather or other covered situations, you can be reimbursed up to $10,000 per person and $20,000 per trip for your prepaid, non-refundable travel expenses, including passenger fares, tours and hotels. Just beware certain situations are excluded, such as traveling against the advice of a physician, traveling to a place where war is being fought and trips that are over 60 days long. Right now, this card is offering new applicants up to 80,000 Ultimate Rewards points after spending $4,000 on purchases within the first 3 months with the card. Its annual fee is $95.
Chase Sapphire Reserve®: This card's trip cancellation coverage is identical to that of the Chase Sapphire Preferred® Card, only it covers up to $40,000 per 12-month period. New applicants are eligible to earn up to 60,000 Ultimate Rewards points after spending $4,000 on purchases in the first 3 months. Its other benefits include a $300 annual travel credit each account anniversary year and access to over 1,300 airport lounges after enrolling in Priority Pass Select. Its annual fee is $550.
The Platinum Card® from American Express: If your qualifying round trip is canceled or interrupted for covered reasons, this card covers claims for up to $10,000 per trip and $20,000 per eligible card per 12-consecutive-month period. This card is currently offering new applicants up to 75,000 Membership Rewards points after they use their card to make $5,000 in purchases in the first 6 months. Its annual fee is $550. Terms apply; read card details for more. Something to know before you apply: This card doesn't not work like a traditional credit card, and your ability to carry a balance can be limited to certain charges.
Bank of America® Premium Rewards® credit card: This card provides reimbursement of up to $5,000 per person, per trip, for the unused prepaid non-refundable travel expenses including passenger fares, tours and hotels if you have to cancel due to a covered reason. New applicants can earn up to 50,000 bonus points after making at least $3,000 in purchases in the first 90 days of account opening. Its annual fee is $95.
How Does Trip Cancellation Insurance Work?
Trip cancellation insurance usually covers non-refundable prepaid travel expenses if your trip is canceled or interrupted due to unexpected events. As with any type of insurance, though, you can bet that there are plenty of conditions. Don't expect to get any money back if, for example, you simply change your mind and want to cancel your plans. Rather, trip cancellation insurance is meant to kick in when unforeseen circumstances arise and make it impossible to start or continue your trip. Here are the general outlines of trip cancellation insurance, though the exact coverage will vary by card.
- Who is covered: Trip cancellation insurance typically extends to the primary cardholder and companions or family members on their same reservation when the trip has been paid for using the card or, in some cases, rewards points earned with the card. Coverage might also include immediate family members of the cardholder, even if they are not traveling together.
- Coverage amounts: The payout you can receive in trip cancellation insurance varies widely by card. Before you charge any travel expenses, review your coverages and aim to use the card with the highest amount. For example, the Chase Sapphire Reserve® will cover up to $10,000 per trip or $20,000 per occurrence if there's more than one person traveling, and $40,000 within a 12-month period. By contrast, the Chase World of Hyatt Credit Card only provides up to $5,000 per trip.
- Covered circumstances: Trip cancellation insurance will only apply to certbaggain situations, so when planning a trip, review your card's benefits guide to find out if you will be protected. In general, covered circumstances include accidental injury, sickness or death experienced by the cardholder, a traveling companion or an immediate family member; severe weather that prevents the start of your trip; or even a court subpoena that cannot be postponed or waived, among other possibilities.
- Exclusions: You will also need to check your specific card's benefits guide, or call customer service, to find out what situations are not covered. Usually, they include things like an organized strike affecting public transportation, a pre-existing medical condition, traveling against the advice of a physician, or if your travel agency, tour operator or travel supplier (like an airline or hotel) goes out of business.
If your trip is indeed canceled or interrupted for covered reasons, the next thing you will need to do is start the claims process.
How to File a Trip Cancellation Claim
Get ready to do some legwork! As with sending in a car or health insurance claim, filing a trip cancellation claim requires you to provide plenty of supporting information. The good news is, many credit cards have made it easier to file a trip cancellation claim directly online.
- Call your credit card issuer. The first thing you should do is call your credit card company's customer service line and ask how to file a claim. The sooner you do this, the better.
- Submit your evidence. Once you log in to your credit card's claims site using your card number, you will have to complete a form outlining what happened. This might include listing the reasons for canceling, the dates of your trip, flight and hotel confirmation numbers, and whether you have any other insurance plans in place. You usually have to provide the receipts for expenses you need reimbursed, and if you have a medical reason for canceling, be prepared to provide proof of doctor or hospital visits as well as a note from your doctor. Finally, gather any credit card statements with eligible charges on them to submit as well.
- Stick to deadlines. Most trip cancellation policies require you to submit your claim within a certain time frame after your plans changed. If the insurance administrator asks for more supporting materials, you will usually have to submit them within 90 days, or as soon as reasonably possible, for your claim to remain active.
- Check on the claim's progress. Once you submit a completed claim and your supporting materials, the claim will typically be resolved pretty rapidly. Don't be afraid to check in every week, though, and if you are asked for more information, provide it as quickly as possible.
Other Ways Your Credit Card Can Protect You When You Travel
Aside from trip cancellation insurance, many travel rewards credit cards offer additional protections to cover cardholders when their plans go off the rails. Here are a few perks to consider when deciding which card to use to pay for your trip and carry with you once you're on your way.
- Trip delay: If your common carrier (like an airline, train or cruise ship) is delayed, causing you unexpected expenses like meals or lodging, your credit card might reimburse you for them. Depending on the card, this usually kicks in at six or 12 hours and is typically capped at $300 to $500 per ticket.
- Lost or delayed baggage: If your bag shows up late or goes missing altogether, your credit card might cover the cost of replacing items like clothing or toiletries while you wait, or replacing your luggage if it never shows up or is damaged by the carrier. For example, delayed baggage coverage with the Chase Sapphire Reserve® card kicks in after six hours and covers $100 per day for up to five days; lost or damaged luggage covers up to $3,000 per passenger for you and immediate family members. Credit cards may exclude certain items, though, such as missing jewelry, cameras or electronics. Check with your card's terms for details.
- Rental car insurance: Many credit cards include secondary insurance for car rentals. This only usually covers damage to the rented vehicle itself, and will only kick in after you have used up any benefits from your personal insurance or insurance offered by the rental agency. Some credit cards, including the Chase Sapphire Preferred® Card, offer more comprehensive primary coverage.
- Travel accident insurance: Let's hope you never need this, but if you or a travel companion are injured, maimed or even killed during a trip, your credit card might include a policy to pay for some medical expenses or offer a payout similar to a life insurance claim. Keep in mind that causes like political unrest in the destination or accidents that result from intoxication, among other exclusions, will void this insurance.
- Purchase protection: If an item you buy is stolen or damaged, your credit card might pay to repair, replace or reimburse you for it. This usually only covers things purchased within the last 90 to 180 days with firm dollar maximums that are typically around $500 to $1,000 per claim.
Beyond simply earning rewards points and offering day-of-travel perks like lounge access, many travel rewards credit cards include valuable protections as part of their benefits. The most important might just be trip cancellation insurance for when your plans change due to circumstances beyond your control.
Before booking a trip, go over the benefits guides to your various credit cards, or call your issuers to ask what protections are offered. Then consider using the card that extends the most comprehensive trip cancellation insurance possible to have the best chance of being covered while traveling. To get credit card offers based on your needs, you can find personalized options through Experian CreditMatchTM.
All information about the Bank of America® Premium Rewards® credit card and World of Hyatt Credit Card has been collected independently by Experian and has not been reviewed or provided by the issuer of the card.