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Travel

Coronavirus: Should I buy travel insurance?

Travel providers more likely to assist than card companies

Summary

While some credit cards come with fantastic travel insurance perks, the coronavirus pandemic is not officially covered under these policies. But one issuer is reportedly providing a glimmer of hope to wary travelers, and hotels and airlines are waiving cancellation fees in hard-hit areas.

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The COVID-19 pandemic has caused unprecedented disruptions in travel. Many travelers are wondering if changes to their existing trips are covered by travel insurance and whether or they’ll get reimbursed.

It’s an easy decision if your flight never takes off: You don’t go on the trip, and you get your money back. It gets more complicated if everything remains on schedule, but you decide not to go.

Will travel insurance cover cancellations due to COVID-19?

Most travel policies issued after mid-January 2020 consider COVID-19 a “known event,” making it ineligible for claims. Even credit card travel insurance and personal policies issued before that didn’t typically cover coronavirus-related cancellations.

Most people who want to avoid traveling because of the virus are afraid they might get sick. And that usually isn’t enough of a reason for travel insurance to cover you. The exception is a “cancel for any reason” policy, although even that coverage has some holes.

It costs significantly more than standard travel insurance (often 40% to 60% more), and it typically only covers between 50% and 75% of your nonrefundable costs. This coverage acts as a copay of sorts. You’ll have some skin in the game, so you don’t get off scot-free and leave the insurance company with a huge loss.

Credit card issuers’ response to COVID-19 cancellations

Because of these gaps in coverage, credit card companies should be viewed as a backup plan. While many card issuers are making concessions for customers who are struggling to pay card bills, most are stopping short of extending travel insurance coverage to cover coronavirus-related changes for all cardholders. As the situation continues to evolve, card issuers might provide more leeway to cardholders struggling to cancel future travel.

On Feb. 6, Forbes reported that American Express was offering some concessions for certain cardholders with select cards – likely its higher-end offerings such as The Platinum Card® from American Express, the Delta SkyMiles® Reserve American Express Card and the Marriott Bonvoy Brilliant™ American Express® Card.

“If your physician advises that your trip is not medically advisable and you immediately notify your travel supplier (airline, hotel, tour company, etc.), Amex’s trip cancellation coverage on select credit cards should kick in,” according to Forbes.

Earlier this year, American Express spokeswoman Elizabeth Crosta said in an e-mail these claims are handled on a “case-by-case basis.”

Though its travel insurance might not cover all cardholders wishing to cancel, American Express is providing relief in other ways. For cardholders who booked travel through American Express Travel, the flight modification fee is waived through Sept. 30, 2020.

If you actually get sick, or if you’re stranded somewhere, the Chase Sapphire Reserve has particularly generous travel protections. These include reimbursement for trip cancellation or interruption expenses (up to $10,000 per person and $20,000 per trip), emergency evacuation and transportation while on a trip (up to $100,000) and emergency medical or dental coverage (up to $2,500 if you are 100 miles or more away from home).

See related: Chase travel insurance benefits

For Chase customers without circumstances that qualify for trip insurance, it has not officially offered any travel insurance concessions. For trips booked through Chase Ultimate Rewards, it is promising to “work with the airline on your behalf … and help with any refunds or credits you may be eligible for.”

Travel providers are your best bet for a refund

If you need to cancel a trip due to the pandemic, your best approach should be to contact the travel provider. Most airlines, cruise companies and hotels are offering extremely generous cancellation and change policies, even on supposedly nonrefundable reservations. These pertain to reservations paid by card or cash and award tickets booked through the travel provider or credit card company. There’s usually a cutoff date, although it could be extended if conditions warrant.

Airline and hotel rewards program change policies

Travel providerCOVID-19 change policy
AirbnbGuests can cancel reservations booked on or before March 14, 2020, with a check-in date before June 30, 2020, without a fee. Hosts can cancel within that same time period without “charge or impact to their Superhost status.”
American AirlinesWaived change fees on nonrefundable tickets for travel through Sept. 30, 2020, plus waived change fees for tickets purchased between March 1 and May 31, 2020, as long as travel starts within a year of the ticket issue date.
DeltaWaived change fees for travel through Sept. 30, 2020, plus waived change fees for flights purchased between March 1 and May 31, 2020.
HiltonFree changes and cancellations up to 24 hours prior to arrival for all existing reservations through June 30, 2020, plus free changes and cancellations up to 24 hours prior to arrival on new reservations, as long as the reservation is booked between March 25 and June 30, 2020.
HyattFree changes and cancellations up to 24 hours prior to arrival for all existing reservations through June 30, 2020, plus free changes and cancellations up to 24 hours prior to arrival on new reservations, as long as the reservation is booked between April 2 and June 30, 2020.
IHGWaived change and cancellation fees for all reservations booked before April 7, 2020 for travel through June 30, 2020. Free cancellations up to 24 hours prior to arrival on new bookings made up to Sept. 3, 2020, for stays through Dec. 30, 2020.
JetBlueWaived change and cancellation fees for travel through Jan. 4, 2021, on tickets purchased before May 31, 2020.
MarriottFree changes and cancellations up to 24 hours prior to arrival for all existing reservations as long as the change or cancellation is made by June 30, 2020, plus free changes and cancellations up to 24 hours prior to arrival on new reservations, as long as the reservation is booked before June 30, 2020.
Southwest AirlinesDoes not charge change fees.
United AirlinesWaived change fees for travel through May 31, 2020, as long as tickets were booked on or before March 2, 2020, plus waived change fees for travel 12 months out, as long as the tickets were booked between April 1, 2020 and May 31, 2020.

If you’re currently debating whether or not to cancel or reschedule a later trip, sit tight for now. Hopefully the situation will improve, and you’ll be able to travel as you originally intended. If things aren’t better, travel providers will likely continue to extend their fee waivers. It doesn’t make sense to pay a change or cancellation fee now – just wait and see.

Have a question about credit cards? E-mail Ted at ted.rossman@creditcards.com. He’d be happy to help.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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