Travel Insurance and flight cancellations

Most people rarely anticipate flights being cancelled because of airline strikes, which could leave them stranded with little recourse. But unfortunately, this can be a more common occurrence than you think.

Every year tens of thousands of passengers are affected by flight cancellations following airline strikes.

Read on for expert advice on what you should do if you become a victim of airline strikes.

What to do if the airline cancels your flight due to strike action?

If you are a traveller caught in the midst of an airline strike, there are a couple of things you can do to decrease your trip disruption and any financial losses. Regardless of whether you are in the middle of your trip or have an upcoming one, you should call your travel agent or the airline directly to figure out your options. While some airlines can be fairly generous in waiving their fees, airlines are not actually obligated to do anything to help passengers. Thus, you should expect every airline to respond to their strikes differently and have a contingency plan in the event you won't receive any help.

Despite this uncertainty, airlines have typically waived re-booking fees or put travellers on a standby flights with partner airlines when labour strikes have occurred. In this case, getting to the airport early may help you secure a flight as close to your original departure time as possible.

Will travel insurance cover financial losses due to airline strikes?

Whether you are in the middle of your trip or haven't left yet, you should get in touch with your travel insurance company if the airline isn't being helpful.

Generally, if you are able to recoup the costs for trip delays, disruptions or cancellations with your travel agent or airline, your insurer won't approve your claim. However, if the airline won't cover rebooking fees or doesn't offer compensation for delays, then you may be able to file a claim with your travel insurer.

In order for your claim to be successful, the insurer must explicitly mention that strikes are covered under their policies. You can also call your insurer if you are unsure of the language in your travel plan's policy document. Most plans offer 24/7 emergency assistance so you can call them from anywhere in the world at any time.

However, you may not be covered if you bought a travel insurance policy AFTER the news of the strike was made public.

Whether you bought a single trip plan or annual plan, most insurers will only reimburse you for financial losses arising from claims directly or indirectly caused by a strike if;

•  You bought a single trip travel insurance policy before the strike was made public.
• You have an annual travel insurance plan and you booked your trip before the strike was made public.

Ways to help reduce financial loss during travel emergencies

While you can never fully avoid the risks associated with travel, there are a few things you can do to reduce the impact of a travel-related emergency.

• Travel insurance. This is a great way to protect yourself financially against a majority of travel-related issues. When looking for a policy, you should read the policy wording to make sure it covers all of your concerns. Buying your policy as soon as you book your airfare and hotel can also prevent your insurer from denying your claim because you bought a policy after a disruption was made public.

• Emergency fund. It is worth budgeting a little more than you need for your trip. This way, you'll have an emergency fund to draw money from, and you won't be forced to draw from your earnings. if you can't get your money back. You should at least be able to cover emergency hospital or delay expenses. That way, if you are left stranded with no financial recourse, you are not pulling money out of your savings or racking up credit card bills.

• Stay aware of what is happening in your destination country. As soon as news of any potential trip disruptions are made public, you should reach out to airlines, hotels and your insurer to see what your options are. Staying aware and taking action as soon as possible is usually the best way to reduce stress and start working on solutions.

What do you do if an airline goes bust?

Airline shutdowns are more common than travellers imagine with at least 15 airlines going bust in the past 10 years. And when it happens it can leave passengers stranded.

In the event of a shutdown, travellers can be lucky enough to get on a flight from a partnered airline for free or get discounted tickets from other airlines. However, in some cases these prices can still be quite expensive. This can be a blow to consumers who already paid a hefty price to get to their destination.

If you are stranded in the midst of your trip because your flight has been cancelled due to a shutdown airline, there are several things you can do.

• First, you can see if other airlines are willing to seat passengers affected by the shutdown.

In the best case scenario, you may be able to get a heavily discounted flight home or receive a 100% ticket refund. In the worst-case scenario, you may end up having to pay last-minute fares for a trip home. This will not only be expensive, but it may also require taking additional days off from work, given that there is no guarantee you can get on a same-day replacement flight.

• You should also notify your travel insurer to see if your policy covers the cancelled flight.

While some insurers do not provide trip cancellation coverage due to airline faults, other insurers do. However, even among the insurers that offer coverage, there are often stipulations. These can range from whether you were offered an alternative flight or if you were able to get a replacement flight within 24 hours of the cancelled flight. Do read the small print.

Booked a trip with a bankrupt airline?

If you have booked an upcoming flight with an airline that shut down, you have several options. You can see whether your travel insurance offers benefits under insolvency protection. This benefit may let you claim for losses incurred due to your airline shutting down. However, it is worth noting that while some insurers cover travel agent, tour operator and transport provider insolvency, other insurers only cover travel agency insolvency. This means you may be unable to get the money back from filing a travel insurance claim. Instead, you can try calling your credit card company to see if they can cancel the charge. Credit card companies offer consumer protection services and will refund charges for non-delivered goods and services, which may include unusable airline tickets.

Finally, you should also be wary of the companies that you book flights with. While low-cost airlines are popular with travellers because of their unbeatable fares, they’re also vulnerable to losses. This puts them at risk of going under. Instead, you should book with trusted, larger airlines that have a healthy financial record. You'll be able to tell if they do by following airline industry news and keeping an eye out for airlines that seem to be struggling financially.

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