“I’ve heard so much about events like the flooding in Colorado, or the fire on the boardwalk in New Jersey. It seems like so many people have had their homes or businesses destroyed. I can’t help but wonder what would happen if they were planning to travel someplace. Would they even be able to go? Would they lose the money on their trip, too?”
Before we answer your question, let us just take a moment to acknowledge the deep losses felt by those affected by the events you’ve mentioned, as well as other significant fires, floods, and natural disasters that have devastated other parts of the country and the world. Our thoughts are with all those who have been affected.
In response to your question about losing money on a planned trip in the aftermath of a tragedy of this nature, fortunately, the answer is that there are circumstances in which a travel insurance policy could prevent a total loss. The policy would have to have been in effect before the disaster took place (or was “foreseen,” as in the case of a hurricane headed straight for your neighborhood), but there certainly are some benefits that could be of help.
Primary Residence Uninhabitable. This travel insurance benefit is generally available as part of the comprehensive coverage on some plans. It allows you to cancel your trip and recover any pre-paid, non-refundable expenses you’ve insured if your home is damaged badly enough that you must change your plans to deal with repairs.
Cancel for Work Reasons (CFWR). In the case of a tragic event like the boardwalk fire in New Jersey, which destroyed many businesses, CFWR could be an important benefit. While it offers coverage for other work-related emergencies, such as a sudden and unforeseen loss of employment, or a last-minute scheduling change that requires you to be at work when you had planned to be vacationing instead, CFWR can also function very similarly to the Primary Residence Uninhabitable benefit.
If your main source of income – your livelihood – is significantly damaged, and you must stay home to deal with the fallout, you could potentially file a claim under CFWR to recover your pre-paid, non-refundable expenses. Some travel insurance policies will offer this benefit without the “CFWR” name as well, and details may vary, so make sure you read your policy thoroughly to understand your coverage.
Cancel for Any Reason (CFAR). By far the easiest to remember of all travel insurance coverage options for this type of event, CFAR does exactly what it sounds like it would do – allows you to cancel your plans for any reason you see fit, regardless of the listed “exclusions” on your travel insurance policy. In other words, with CFAR, your policy would not have to include Primary Residence Uninhabitable or CFWR for you to be able to change your plans in the wake of a destructive fire or flood.
However, it’s important to note that eligibility for CFAR depends heavily on following the rules: Typically, you must insure every cent of your trip’s cost in order to receive coverage, you must purchase the policy within 10-30 days of making your first trip payment, and you typically need to cancel your trip and notify all your travel suppliers 48 hours or more prior to your scheduled departure in order to file a claim under the CFAR benefit.
Situations like these are precisely the sort of thing travel insurance was designed for – emergencies that absolutely could not have been foreseen nor prevented. Luckily, the right travel insurance policy for your individual needs can at least help you be a bit more prepared if an unexpected disaster strikes.