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Trip cancellation. How to protect yourself

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As tempting as it may be to leave your travel insurance to the last minute, it really does pay to arrange it as soon as you have booked your holiday.

Here’s why you should book your travel insurance early

There are two words that create travel nightmares - trip cancellation. Around 50 per cent of travel insurance claims are due to cancellations. Generally, people end up cancelling due to ill health. 

How to protect yourself

With Budget Direct Insurance, you are covered from the moment you buy your travel insurance policy. This means that if anything happens before you leave for your trip, you can relax and make a claim.

Most comprehensive travel insurance policies will cover you when you cancel due to the following:

  1. You, your family or travel companion becomes seriously ill.
  2. A sudden riot, strike or a civil commotion breaks out in either Singapore or the country you’re travelling to. For instance, there has been much civil unrest in Thailand.
  3. An epidemic breaks out at the country you’re travelling to and the World Health Organisation (WHO) issues a warning after you buy your policy. SARS and Zika would be prime examples.
  4. All flights are grounded and the runway, or airspace, is shut down. For instance, the volcanic ash clouds saga a few years ago that shut down air travel in Singapore and around the world. Plus, the volcanic ash in Bali.

But you would only be covered for these events if you bought the policy beforehand. If you buy your policy once news of such events like epidemics, riots and bad weather is in the public domain, then you won’t be covered.

Advice on single trip and annual travel insurance plans

At Budget Direct Insurance your policy, either a single trip or annual plan, will cover you for financial losses arising from claims directly or indirectly caused by such events if:

* For Single Trips: You bought the insurance policy before a relevant authority (whether in Singapore or elsewhere) issues a travel advice on the event or before the event is reported in any media.

* For Annual Plans: You booked your trip before the travel warning announcement by the a relevant authority (whether in Singapore or elsewhere) issues a travel advice on the event or before the event is reported in any media.

* If you buy your insurance policy AFTER the event is reported by the media or following a relevant authority’s (whether in Singapore or elsewhere) issuance of travel advice on the event, then your policy will not cover you for claims directly or indirectly caused by the event. For example, we don’t cover for any travel delay/ cut short due to volcano eruption but we DO cover you for medical expenses due to fever for instance or if you were robbed

What about airline cancellation?

It’s important to read the small print here when it comes to your insurance cover. Most insurance companies will cover you when the airline cancels due to:

Closing down of the airport, runway or airspace. Or poor weather conditions which forces planes to be grounded.

But you are not covered if the cancellation is due to a problem with the individual airline. For instance, mechanical breakdown of the plane.

As always, Travel insurance cover varies from policy to policy so it’s important to read the policy documents to ensure you know exactly what you’re covered for.

Ways to help minimise financial loss during your trip

There are several steps you can take to recoup at least a part of your trip expenses. For instance, you can also talk to your airline's customer service representative in the event your flight is cancelled or delayed. In most cases, they will do their best to put you on the next available flight or give you some form of credit or refund.

They may even offer you perks such as a seat upgrade on your next flight. You can also call your tour operator as soon as possible to let them know if your cancelled or delayed flight led to you missing a non-refundable event such as a tour or excursion. They may lend a sympathetic ear and agree to reschedule your tour for free for the next available time slot.

Hotels and Airbnbs often have a cancellation window of 24-48 hours prior to check-in, after which you may end up paying a fee to cancel. However, Airbnb may not charge you even if you are outside the full refund window, provided you have a legitimate reason for being late or cancelling the booking. This is explained in their Airbnb Cancellation Policies page which states that cancellation policies "may be superseded by the Guest Refund Policy, extenuating circumstances or cancellations by Airbnb". Hotels may operate similarly, but it helps booking a hotel that has a flexible refund policy. In the event you can't get a refund at all and you have a legitimate excuse, you can ask if they can offer some form of compensation through a hotel credit.

Enjoy stress-free holidays when you buy smarter Travel insurance.

Check out Budget Direct Insurance for your best deal

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