Travel

Travel Planning in the Time of Coronavirus

Insurance may not cover canceled vacations, but airlines and hotels may be flexible.

As the coronavirus continues to race around the globe, travelers are reconsidering their vacation plans. But if you’re counting on travel insurance to cover the costs of canceling a trip you’ve already booked, you may be out of luck.

Generally, travel insurance won’t cover losses associated with epidemics or even pandemics, such as the coronavirus. And even if you’ve purchased a policy that covers epidemics, it probably won’t cover a trip booked after January 21, when the coronavirus became a “known event” (the exact cutoff ranges from January 21 to 27, depending on the insurer). Travel insurance plans generally exclude losses caused by events, such as hurricanes, that were known or fore­seeable at the time the plan was purchased.

If you purchased travel insurance for a trip you now want to cancel, it may still be worthwhile to file a claim. You may have coverage if you purchased a “cancel for any reason” policy, which typically costs 40% more than standard travel insurance and covers 75% of nonrefundable expenses. Read the terms and conditions of your insurance policy carefully. And when making a claim, use specific language about why you’re unable to travel, because coverage depends on the exact reason for cancellation.

Flight forgiveness. You should also contact your tour operator and airline. In many cases, and especially for trips to China or other Asian destinations, tour operators are refunding trip deposits or waiving change fees. If your travel supplier allows you to change the dates of your trip, some travel insurance companies will also change the dates of your travel insurance policy.

Several major airlines have waived change fees for flights to places that have reported widespread outbreaks, including China, Hong Kong, South Korea and northern Italy. And most major U.S. airlines have said they will suspend change and cancel fees for travel up to a certain date, as long as the trip was booked within a specific time frame. For example, JetBlue has suspended change and cancel fees for all new flight bookings made between March 6 and March 31 for travel through September 8, 2020. American Airlines has waived change fees if you bought your ticket on or before March 16, 2020, for travel through May 31, 2020. New travel must start by December 31, 2020, or within a year of the date the ticket was issued, whichever comes earlier. Delta is waiving change fees for all travel departing in March or April, and for international flights departing in May. And deadlines for refundable bookings are likely to be extended, says Scott Keyes, founder of ScottsCheapFlights.com.

Travel and tourism contribute more to U.S. gross domestic product than agriculture, mining or utilities.

YearTotal revenue,
in billions
Percentage
of GDP
2010$15.02.52
201115.52.60
201216.22.69
201316.82.78
201417.52.79
201518.22.88
201618.72.88
201719.52.88
201820.62.90

If you decide to go ahead with your trip, travel insurance has other advantages that could come into play. Many policies will cover medical care and the cost of returning home early if you fall ill or become injured. Some policies pay for medically equipped flights to a hospital or, in extreme situations, back home. If you’re interested in buying travel insurance for a trip sometime in the future, you can compare coverage and rates at third-party sites such as www.insuremytrip.com or www.squaremouth.com.

Linda Kane, a frequent traveler from New York City, says last year she and her husband purchased a travel insurance plan that would cover up to $50,000 in medical expenses for an upcoming trip overseas. But they reconsidered their plans, concerned about the coronavirus. “We were supposed to go to Morocco,” she says. “But eventually we decided not to go. And we were able to postpone.”

Most Popular

Your Guide to Roth Conversions
Special Report
Tax Breaks

Your Guide to Roth Conversions

A Kiplinger Special Report
February 25, 2021
Resist the Impulse to Buy These 14 Holiday Gifts
shopping

Resist the Impulse to Buy These 14 Holiday Gifts

Don't let those holiday sale promotions persuade you into buying something now that will be much cheaper later.
November 18, 2021
Should You Take an Extra Big RMD This Year?
required minimum distributions (RMDs)

Should You Take an Extra Big RMD This Year?

Sometimes only taking the minimum IRA distribution can be a costly mistake. When deciding how much to withdraw this year, you need to consider the big…
November 23, 2021

Recommended

Taxes on Unemployment Benefits: A State-by-State Guide
state tax

Taxes on Unemployment Benefits: A State-by-State Guide

Don't be surprised by an unexpected state tax bill on your unemployment benefits. Know where unemployment compensation is taxable and where it isn't.
December 7, 2021
Child Tax Credit Payment Schedule for the Rest of 2021
Tax Breaks

Child Tax Credit Payment Schedule for the Rest of 2021

The IRS has already sent five batches of monthly child tax credit payments. Here's when you can expect the final payment.
November 24, 2021
Honey, We Need to Talk About Money
Women & Money

Honey, We Need to Talk About Money

Instead of focusing on the numbers, couples might have more success discussing their goals.
November 24, 2021
Final Child Tax Credit Payment Opt-Out Deadline is November 29
Tax Breaks

Final Child Tax Credit Payment Opt-Out Deadline is November 29

The due date for opting out of the December 15 monthly child credit payments is almost here. Missing the deadline could cost you in the long run.
November 24, 2021