Travel Insurance: Is It Worth It?

With C.F.A.R., a traveler is able to back out any time until a few days before departure and get some money back, usually 50 to 75 percent. It’s more expensive than regular travel insurance and must be purchased within a short window after making the initial trip deposit, usually less than 21 days. Additionally, the policy only covers cancellations up to two or three days before the trip.

Using Travel Guard’s website, I priced insurance on a $10,000 trip to France. Its basic policy costs about $500 to insure. But to get C.F.A.R., I would have to take the “preferred” policy at about $554. Adding the C.F.A.R. option offering 50 percent back, cost $128, for a total of $682. If I canceled because of the pandemic, or for any other reason, I would only get $5,000 back, half of the insured amount. Less the premium, that’s $4,318 net.

Cancel for any reason, Mr. Birnbaum said, “is treated as insurance, but it’s not really. Insurance is protection against some fortuitous event.” This policy, he said, covers a decision that’s in your control — such as changing your mind about taking a trip — not a risk that’s out of your control, like a car accident.

Mollie Fitzgerald, a travel adviser in Gibsonia, Pa., rarely recommends C.F.A.R. because it’s expensive — it can be 35 to 50 percent more than regular travel insurance, she said — and becomes more expensive the older you are, while only covering a maximum of 75 percent of the trip.

“Occasionally, a trial lawyer or someone like that whose calendar is fluid will request C.F.A.R., but it’s less than 1 percent of our insurance sales,” she wrote in an email.

But for many travelers, something is better than nothing. Edward Chan of Rancho Palos Verdes, Calif., spent $552 on an insurance policy with C.F.A.R. through Travel Insured International that offered 75 percent back on a $13,000 family cruise. During the pandemic, he canceled before the final payment was due and got his money back, except for a $1,000 nonrefundable fee.

Making an insurance claim through Travel Insured International, he got $750 of that fee back.

“So it was worth it for me to make the claim,” he wrote via Twitter, noting it took two hours on the phone with an agent two months after making the claim to get the refund approved.

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