Travel Insurance for COVID-19: Finding Coverage During a Pandemic
COVID-19 is shifting the travel insurance landscape. There’s also no single definition of “coverage.” In the most basic terms: if you have travel booked, but no travel insurance, coverage is still available. We’ll cover key milestones, the response from providers, trip cancellation, benefits you may still be able to receive, premium & specialized forms of coverage, and important terminology.
Over the past few weeks, friends & clients have been asking us about trip cancellation and travel insurance for COVID-19. The questions themselves are pretty standard. Millions of others are asking the same.
But the implications behind the questions…that’s the truly painful part. The fact that we’re here discussing this, is beyond saddening.
Unfortunately, this is our reality at the moment.
Wherever you are in the travel process, this post has something for you.
If you currently have travel arrangements booked and travel insurance in place, you might be wondering: Does my policy cover a pandemic? Am I covered if I cancel my trip because I’m scared I’ll endanger the loved ones I was planning to visit?
Those of you with travel plans but no coverage in place, surely have questions as well: Will I get my money back if my conference was canceled? What about a family member’s wedding?
Even those of you with no current plans, but a healthy desire for future travel, may be curious. Can I buy travel insurance for COVID-19, specifically? Can travel insurance even help me right now?
With all of those questions in mind, we’ve been trying to make sense of an already-confusing topic during an unprecedented global event. Since we cannot offer financial advice, we’ll simply offer the best currently-available information and present some hypothetical situations. In some cases, we’ll tell you what we have done, or will be doing in the future.
- Current state of travel in 2020
- Can I cancel my trip because of COVID-19?
- Finding coverage during a pandemic: key points
- Travel insurance for COVID-19: how to find providers
Though comprehensive, this post is still a general overview only. It does not represent the full picture. With travel insurance, it’s always important to carefully read a policy’s wording for a full description of coverage. Benefits vary significantly by policy and provider. When you have questions, call the provider, or ask a qualified insurance expert to advise you.
Current state of travel in 2020
The travel industry is devastated. All direct suppliers (airlines, hotels, tour operators) are cutting back on services in one way or another. Many are laying workers off. As for the small businesses in every corner of the world that rely on tourism… some are facing a harsher reality: permanent closure.
Across the globe, people are terrified. Normally-adventurous travelers are nervous to go grocery shopping, nonetheless get on a plane. The dust will settle. But in the meantime—amidst all the other financial pressure—how can you ensure your investment in an upcoming trip isn’t a total loss?
Conversely: in anticipation of that settling dust, is now possibly the right time to make travel plans, somewhere down the road? After all, prices are low, and wanderlust is a great way to combat the monotony of quarantine.
Can I shelter my body in place, but let my mind meander to Montenegro? And if I decide to roll the dice and plan a trip, how do I find the right travel insurance coverage during a pandemic?
We’ll save the wanderlust for a future post. Today, we’ll focus on the financial protection.
Does travel insurance for COVID-19 even exist?
There’s no single explanation of “coverage” when it comes to travel insurance. By definition, coverage applies to many unexpected & undesirable events, before & during travel: trip cancellation, trip interruption, medical expenses overseas, medical transport costs, non-medical evacuation costs, lost baggage, trip delays, flight cancellations, rental car protection, etc.
In general, protection from financial loss is the underlying purpose of travel insurance. Peace of mind is a universal human desire, and a byproduct of that protection. All of this is heightened at the moment.
As this pandemic unfolds, our personal definition of coverage extends further, and includes access to specialized services like field rescue, medical transport, and virtual healthcare. At some point, the international travel restrictions will be lifted. But even then, many travelers may only feel comfortable traveling domestically. We’ll discuss a membership option that provides these specialized emergency services in your home country, where travel insurance doesn’t apply.
What’s your motivation?
“Cancel for any reason” (CFAR) policies always offer more flexibility than standard policies. If you have no reason for trip cancellation other than “I’m scared or nervous to travel anytime soon,” a CFAR policy is the most viable option for at least partially recovering expenses. You’ll pay a premium for CFAR—and there may not be options available (we’ll cover the restrictions later).
But what if trip cancellation or fear of travel aren’t your primary motivation for finding coverage? Many policies still cover plenty of ‘things’ that could affect you, now or in the future. Some of those ‘things’ are directly related to COVID-19.
Recent timeline & key dates
A lot has happened in the last 3 months. The following milestones are relevant to this discussion:
- January 21, 2020 — first confirmed case in the United States.
- February 11, 2020 — World Health Organization (WHO) announces new names for the virus (severe acute respiratory syndrome coronavirus 2, aka “SARS-CoV-2”) and the disease it causes (coronavirus disease, aka “COVID-19”).
- March 11, 2020 — WHO declares the outbreak a pandemic. Two days later, POTUS declares a national emergency.
- March 19, 2020 — U.S. State Department issues the highest possible level of travel advisory (Level 4: Do Not Travel), advising U.S. citizens to avoid all international travel.
- March 27, 2020 — U.S. Centers for Disease Control and Prevention (CDC) issues a Level 3 Warning and recommends avoiding all nonessential international travel.
“Coronavirus” has consumed the media and our daily social feeds. In this post, we’ll use “COVID-19” when describing the pandemic. This is consistent with the way insurance companies will address the subject, if/when you have a discussion with them.
How are travel insurance companies responding?
Travel insurance companies are feeling the impact of COVID-19 as well. In recent weeks, more travelers have been buying premium (more expensive) policies. Good for the companies (in the short term), but this trend has implied downside for those buying coverage. Why?
Premium policies—particularly those that offer cancel for any reason (CFAR) coverage—put more money in the pockets of the insurers up front, but also increase their level of liability in the future. In response, the insurance companies must adjust—and they are already.
Unfortunately, this means they’re either adding new exclusions to limit coverage, or increasing the price of policies—both premium & standard. Some companies may be changing their policy terms (for example: adding an “exclusion” for pandemics), while others may be adding new COVID-19-specific language.
COVID-19 is now a “known event”
The WHO declared the pandemic on March 11th. In the language of travel insurance, this means the COVID-19 outbreak is now a “known event” (or, “foreseen event”).
In general: Once an event is known, providers will limit or exclude trip cancellation benefits for that event, from any new policies sold.
Specific to COVID-19: Now that it’s a known event, newer policies may have coverage restrictions that older policies do not. The US Travel Insurance Association has identified January 21—the date of the first confirmed case in the US—as a key before/after milestone. Travel insurance aggregator Squaremouth notes a range from January 21-27, depending on provider. If you already have a policy, your date of purchase may impact your level of coverage.
Or, it may not…yet. Certain providers haven’t yet assigned a date to the current pandemic. Others don’t list pandemics as exclusions in their policies, in the first place.
Why does this matter? Changes are taking place—and more are on the way. But in the meantime, you can still find policies with trip cancellation benefits for COVID-19.
If you need to actually secure coverage, check out this post.
We’ll introduce you to 2 companies we work with directly, plus our favorite aggregator for researching & comparing additional options. Includes links to generate quotes & purchase policies.
Can I cancel my trip because of COVID-19?
Of course, travel insurance coverage applies to much more than trip cancellation. Later, we’ll examine what coverage is available as far as trip interruption, medical expenses overseas, medical evacuation costs, and non-medical evacuation costs.
For now, let’s take close look at trip cancellation—the most popular type of coverage at the moment, unfortunately.
Covered events & covered reasons
In general: To be eligible for travel insurance benefits, the event that impacts your trip must be listed in your policy as “covered.” Very few policies list viral outbreaks, epidemics, or pandemics as covered.
Example: If pandemics aren’t listed as “covered events” in your policy, then cancelling your trip “because there’s a pandemic” is not going to be a “covered reason.” You can still cancel your trip, but you won’t be reimbursed under the trip cancellation benefit.
Important distinction: Pandemics may not be listed as covered, but they may not be excluded either. Why does this matter?
Using the same example: If pandemics aren’t covered, you can’t cancel “because there’s a pandemic” and expect to be reimbursed. But what happens if you end up taking your trip, and you contract COVID-19 while traveling? Because pandemics aren’t excluded either, some of the policy benefits may still help you, such as trip interruption or costs related to medical treatment.
I’m scared to travel.
This is something on many travelers’ minds at the moment. Unfortunately, “fear of travel” is never a covered reason for trip cancellation. If you need to cancel your trip and the only reason you have is “I’m scared to travel right now,” the travel insurance company will deny your reimbursement claim—if you have a standard policy.
To cancel purely out of fear, you’ll need a cancel for any reason (CFAR) policy, which we’ll explain shortly.
Travel insurance only covers you for “unforeseen events” that occur after you purchase a policy. The “effective date”—typically the day after purchase—is when the trip cancellation benefits kick in. This is one good reason to secure coverage early in the trip-planning process (and there are others, which we’ll address later).
However, it’s perfectly OK to buy travel insurance months after you start planning your trip. Nearly all providers will sell you a policy any time before your departure date. A few (like World Nomads) will even sell you a policy if you’re already traveling. Just remember that the policy doesn’t cover anything before the effective date. Two hypotheticals to consider:
SUCCESSFUL CLAIM: You’ve just been diagnosed with COVID-19, and you purchased travel insurance before you exhibited symptoms. You seek treatment, and a physician recommends that you alter your travel plans for health reasons. Pretty much any policy (standard or premium) with a trip cancellation benefit, will cover you.
UNSUCCESSFUL CLAIM: You have travel arrangements booked (or you’re already traveling) and you’ve just been diagnosed with COVID-19, but you don’t have travel insurance. So, you secure a policy hoping to invoke the trip cancellation benefit, and thus recover your non-refundable expenses. We’ll just say it’s highly unlikely that any provider is going to accept your claim.
Important: If you recover from the illness, and end up healthy enough to travel, your policy can still offer peace of mind in other ways (lost baggage, medical expenses overseas, etc.). Just don’t expect to be able to rely on trip cancellation coverage if your reason is “I got diagnosed with COVID-19 last month, so I bought a policy last week.”
I don’t have COVID-19, but my doctor advised me not to travel.
If your doctor advises you not to travel for health-related reasons before your scheduled departure date, you may be eligible for trip cancellation coverage.
Important: “Health-related reasons to stay home” include far more than COVID-19. Review your policy carefully to see exactly which conditions you need to meet, in order to qualify for trip cancellation coverage. If in doubt, enlist the help of an expert or ask the provider before filing a claim.
Can I cancel because of a travel warning or CDC alert?
Timeline reminder: The U.S. State Department issued a Level 4 Travel Advisory on March 19th, and the CDC issued a Level 3 Warning on March 27. Both recommend avoiding international travel. While some providers may offer trip cancellation coverage for these events, most standard policies do not consider these warnings as covered reasons for trip cancellation. Check the fine print to see if your policy covers a CDC alert.
There’s some silver lining though. Remember, the last paragraph applies to travel insurance. Whether you have a policy or not, and whether your policy covers these events or not, these warnings & alerts may trigger other events that will address the problem for you. For example, if you have an international flight booked in April, the airline may cancel it before you have to think about travel insurance coverage.
If we had an international flight booked several weeks from now, we would not be calling the airline today. Instead, we would wait it out and see how things unfold in the coming weeks. Strategy: hope the airline contacts us about our canceled flight & refund-on-the-way, before we have to cancel on our own and hope for a travel voucher for future use.
Finding coverage during a pandemic: key points
Again, the travel insurance landscape is changing as we speak, but you can still find coverage for certain COVID-19-related events.
Directly affected vs. indirectly affected
In most cases, you must be “directly affected” to benefit from travel insurance coverage. Two hypotheticals to consider:
Indirect: My event was canceled.
If a wedding, festival or conference you were planning to attend is canceled—even if the reason for cancellation is concern for COVID-19—that would fall into the INDIRECTLY affected category. Standard insurance policies do not view event cancellation as a covered reason for trip cancellation.
Direct: I contracted COVID-19.
If you, your traveling companion or a non-traveling family member contract COVID-19 or get quarantined, that would qualify as DIRECTLY affected.
Common benefits: trip cancellation, trip interruption & medical expense
Here are some examples of the coverage you might receive if COVID-19 affects you directly, before or during travel.
If you’re directly affected after your policy’s effective date and before your trip’s scheduled departure date, you may be eligible for trip cancellation coverage. If this applies, any pre-paid non-refundable travel expenses such as flights, hotels and excursions could be reimbursed.
If you or a travel companion are directly affected during your trip and your trip needs to be cut short, you may be eligible for trip interruption coverage. Again, this applies to any pre-paid non-refundable travel arrangements that you cannot use (flights, hotels, etc.).
In the previous example, if your policy includes a benefit for medical expenses, you’d likely also be reimbursed certain expenses for medical treatment overseas. Some providers are only covering COVID-19-related medical expenses if you bought a policy prior to the outbreak. Others are still offering medical benefits to travelers who contract COVID-19 during their trip.
If we were to travel overseas later in 2020, we would be sure to choose a provider who has not excluded medical coverage for COVID-19.
Important: In the language of travel insurance policies—the cost of medical care abroad is separate from the cost of being air-lifted back home. The latter—medical transport costs—fall under the scope of “medical evacuation” or “emergency evacuation.”
Emergency evacuation coverage
Depending on the situation, evacuation and transport costs can run anywhere from $25,000 to $250,000 (or more). Some policies don’t include emergency evacuation coverage. Others only include partial coverage. For example, they may cover medical transport between facilities (foreign hospital to home hospital) but not field rescue (which is costly if it involves a helicopter). Or, they don’t cover evacuations for non-medical events (natural disasters, civil unrest, terrorist attacks).
Because of these limitations, many travelers enlist the help of specialized service providers—like Global Rescue—on top of travel insurance. These providers cover emergency transport & evacuation costs worldwide, which adds value for thrill-seekers who visit remote locations and/or travel frequently around their home country. They also cover both medical & non-medical reasons, meaning your transport costs are paid whether you get life-threateningly ill, or if Cotopaxi erupts while you’re at basecamp.
Important: This specialized coverage isn’t a travel insurance replacement—it’s a complement. If you break a leg skiing in Slovenia, Global Rescue will deploy a team of people to rescue you from the mountain, helicopter you to a nearby hospital, and air lift you to your home hospital (all on an “if needed” basis). They’ll also cover the associated transport & personnel expenses, but they will not cover your actual medical expenses in Slovenia. You’ll still need travel insurance for that.
How can specialized emergency services coverage help you during the COVID-19 pandemic?
Using Global Rescue as an example, their membership benefits apply in your home country as well as overseas. These benefits include 24/7/365 video consultations with board-certified, licensed physicians who can prescribe meds and order labs & imaging in all 50 states. And, you can access this medical support from your own home, while sheltering in place.
If you’re unable to physically travel to a doctor…or you don’t want to risk exposure in a hospital…this virtual support could be of value. It’s also unique to this discussion, since you won’t be relying on travel insurance during home quarantine.
Cancel for any reason (CFAR) coverage
Recall that standard policies don’t consider fear of travel to be a covered reason for trip cancellation. With a CFAR policy, you can cancel because you’re afraid to travel, and still receive partial reimbursement for your non-refundable trip expenses:
- Cancel for a NON-covered reason, and you’ll typically be reimbursed 75% (sometimes 50%).
- Cancel for a covered reason, and you should still be reimbursed 100%.
- Cancellation timeline: In either case, you may also need to cancel your trip at least 2 days prior to departure.
CFAR is an upgrade, and you do pay a premium for this added cancellation flexibility. On average, CFAR policies cost 40% more than standard policies.
Finally, CFAR policies have strict purchase timelines. You usually have to purchase your policy no later than 14-21 days after making your first payment towards the trip. That could mean the date you purchased flights, booked hotels, or paid a deposit to a tour provider.
With some providers, you may need to provide a “trip value” in order to secure a CFAR policy. Since you may not know your actual total trip cost until months later, you may have to estimate. However, it pays to be accurate. Learn more here.
Travel insurance for COVID-19: how to find providers
In our next post, we’ll introduce you to two providers we work with directly, plus an aggregator platform you can use to research & compare prices, benefits & coverage on your own. We’ll also show you how to generate quotes & purchase policies, for whenever the time comes that you feel comfortable traveling again.
Here’s what you’ll find in that post, How to Research & Compare Providers for COVID-19 Coverage:
- World Nomads: the company we use
- Global Rescue: leader in emergency evacuation coverage
- Squaremouth: travel insurance aggregator
- Further reading & additional resources
Buying travel insurance for COVID-19: the bottom line.
If you were hoping to buy travel insurance for COVID-19, we hope this got you one step closer. As always, we encourage you to do your homework, so you find the provider & plan that’s right for you.
For some of the considerations we factor into our own travel insurance decisions, visit this page.
For more background on emergency evacuation coverage, visit this page.
The current situation is unprecedented, and it’s changing rapidly. Though the best thing to do at the moment is stay home, it will eventually be safe to travel again.
Until then, we wish you all a safe & healthy shelter-in-place for the weeks to come.
▾ When you’re ready to travel again…maybe we can help ▾
Family vacations…group friend trips…honeymoons…we’ve got you covered. If you don’t have the time to research and plan your own trip, we’ll take care of the details, so you can focus on the good stuff!
- Visit our Plan A Trip page and set up your free 30-minute Discovery Call.
- Check out our Resources page for some of the best trip-planning tools we use daily.
Disclosure: travelhelix belongs to the World Nomads Partner Program, Global Rescue Partner Program and Squaremouth Travel Partner Program. We do receive compensation if you purchase a travel insurance policy or enroll in an emergency evacuation services membership by clicking via the links on our website. If you’ve found this info useful and plan to purchase a policy, please consider booking through our site—thank you!
Disclaimer: The travel insurance information provided above is a brief summary only. It does not include all terms, conditions, limitations, exclusions and termination provisions of the travel insurance plans described. Coverage may not be available for residents of all countries, states or provinces. Please carefully read your policy wording for a full description of coverage.
Our company is not a licensed financial service provider, and is not certified to sell financial products or offer financial advice. The decision of whether or not to secure coverage is your own, as is the decision of which company to buy from. Should you wish to purchase travel insurance or emergency evacuation coverage via links on our website, such products or services will be governed by terms & conditions solely determined by the providers themselves. It is your responsibility to be fully acquainted with the terms & conditions regarding the use of these products or services prior to, and after, your purchase.