Your Guide to Understanding Travel Insurance Cancellation Cover

The last thing any traveller ever wishes or plans for when organising a trip is having to potentially cancel it, but unfortunately, life is unpredictable and can wreak havoc on our best-laid plans. Thankfully, extensive travel insurance understands this and can offer what is known as Cancellation Cover.

While you may have seen that the travel insurance policy you were considering or already purchased did indeed offer Cancellation Cover, you may be wondering what that coverage actually provides you with.

If you've ever wondered how Cancellation Cover works and why it’s a preferred option on any travel insurance policy, we’re here to break it all down for you in an easy-to-understand way. 

So, let’s get right into it. Cancellation cover is a feature of travel insurance policies that may reimburse you for various non-refundable travel costs in the event you need to cancel your trip for a variety of reasons. It’s just one of the main covers that travel insurance policies provide you with, should unexpected life events decide to mess up your plans. 

The following expenses may be covered by your travel insurance policy under Cancellation Cover if you are unable to reasonably recover your costs from any sources. The coverage limits, sub-limits, and exclusions will, of course, depend on the type and level of policy you selected.

• Travel and accommodation expenses, including lost deposits on flights and accommodation or cancellation fees/penalties you may have incurred by cancelling your travel arrangements

• Pre-paid meal expenses that you may have paid or been contracted to pay 

• Contracted or prepaid costs relating to tours, excursions, event tickets, and other travel activities 

• Travel agent’s cancellation fee up to 10% of the amount paid to the travel agent or $1,500 for an individual policy or $3,000 for a couple/family policy, whichever is the lesser 

Your policy’s Cancellation Cover will not cover you for any and all reasons for you needing or deciding to cancel a trip, so it’s important to read your policy’s Combined Product Disclosure Statement and Financial Services guide for clarity.

• Unforeseeable death, injury, or illness of you or your relative, business associate, or travelling companion who is a resident of Australia and is in Australia at the time this event occurs

• You have to appear in court to be a witness or be on a jury (but not as an expert witness)

• Your planned travel vehicle experiences an accident within seven days before the date you intended to leave and becomes inoperable. This only applies to self-drive holidays

• You must remain at home due to the fact you are a member of the armed forces, police, fire, nursing or ambulance services, and there is an emergency that requires your attention, or you have been posted overseas

• An unexpected fire, storm, flood, or burglary at your home or place of business within 48 hours before the date you planned to leave requires you to remain at home

• You cannot travel because a natural disaster has caused your travel service provider to cancel your prepaid service, and no alternative is provided, and you have elected to purchase the natural disaster option

• If you become pregnant after we have sold you this policy, and you will be more than 30 weeks pregnant (or 20 weeks if you are expecting more than one baby) at the start of, or during, your trip. Or your doctor advises that you are not fit to travel because you are suffering from complications of pregnancy and childbirth. Please note, your policy defines the term complications of pregnancy and childbirth

• You and/or your travel companions simply changed your mind and decided to cancel your trip

• Costs that could have been avoided if you had told your accommodation, tour operators, airline, travel agents, etc, when you knew you had to cancel your trip

• Failure to check in at the advised times outlined by your accommodation, transportation, or tour operators

• Trip cancellation due to terrorism or terrorist acts

• Natural disaster claims that were already known before booking your travel, or if you did not purchase additional Natural Disaster Cover for your policy

• Ignoring travel warnings, such as booking a trip to a high-risk destination, whether it’s due to a natural disaster, epidemic, pandemic, government travel bans, or where there is a "Do not travel" warning in place, or the destination is experiencing civil unrest

• Claim events that disrupt your travel arrangements that do not fall within the defined events your policy provides cover for.

• You need to cancel your trip because you failed to obtain a passport, or your passport expired, which made you unable to travel

• Needing to cancel a trip due to reasons relating to unapproved pre-existing medical conditions. 

The amount you’ll get back depends on your specific policy, such as Tick Basic, Tick Budget, Tick Standard, or Tick Top. You will need to double-check your specific policy’s terms and conditions to know what you can expect.  
Your coverage amounts may also differ depending upon whether your policy is an individual, couple, or family policy and dependent upon what upgrades you may have added to your policy. 

The following tips will help you get the most out of your Cancellation Cover:

• Always read your policy’s PDS before purchasing insurance

• Double-check the limits and exclusions for your specific policy

• Declare any pre-existing medical conditions when applying for your insurance

• Contact the insurance assistance team as soon as reasonably practicable if you need to cancel your trip

• Keep receipts and documentation of all travel costs and cancellations

Travel insurance policies and their Cancellation Cover can offer you added peace of mind, whether you’re planning to travel solo or will be travelling with a companion or family.

Remember to read your policy’s PDS, understand the limits and exclusions relating to trip cancellations, and ensure the policy you choose will suit your needs.

It is important to check the appropriate authority for the most up-to-date travel requirements.