The bags are packed and you're ready to go. If you haven't done it yet, it's time to consider the trip-cancellation insurance offer from the credit-card company. If anything should happen to your itinerary -- whether it's illness, a bankrupt airline or an act of God -- you'll be covered. With some conditions, the credit card company will reimburse you for anything you bought or reserved with the card. Whether or not trip-cancellation insurance came "built in" to the card you're using, it offers a vacation essential: a little peace of mind.
A 2007 survey by the United States Travel Insurance Association found only 15 percent of credit cards offered "built-in" trip cancellation insurance. To find out if your card is among them, read through the cardholder benefits section of your agreement, go to the company website, or contact the customer service line on the back of the card. If the coverage isn't automatic, there may be trip-cancellation insurance available for a fee. As of 2013, American Express, for example, had four different travel insurance plans through its AMEX Assurance Company.
Certain branded credit cards come with automatic trip-cancellation insurance. A MasterCard branded by US Airways, Best Western, or Chase Freedom offers the benefits of the World MasterCard. This includes trip cancellation as well as lost luggage reimbursement and accident insurance. You have to buy the travel services with the card, and it won't help if you just make a random, whimsical change in your schedule. You have to give them an acceptable cancellation reason to claim any benefits. Your own illness or a death in the family, an act of war or terrorism, civil unrest at your destination or a natural disaster will usually qualify.
Acts of God
When Murphy's Law kicks in and Mother Nature starts messing with your vacation, trip-cancellation insurance will reimburse you for non-refundable services. It could even help out if an airline cancels your flight and charges you for a re-booking. If you've pre-paid a car rental and show up late, or never, you can claim a refund of any charges the rental company lays on you. It won't cover any lost income due to the cancellation, nor will it pay on claims handled by your health insurance if you cancel due to an illness or injury.
Credit card trip-cancellation also covers you for the dreaded vacation interruptus. If you miss a connection, the insurance will pay for a new flight booking or an unexpected hotel stay. If you become sick during the trip, or are called home on urgent business, the coverage will take care of a change in your flight itinerary. If an airline cancels your return flight due to a storm or political upheaval, or just goes out of business, the insurance also covers unforeseen travel and lodging expenses. Contact the credit card company to go over the specifics.
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