Insurance Coverage for Award Flights in Travel Policies
In the world of travel, unforeseen events can often disrupt even the most meticulously planned trips. That's where trip cancellation insurance, or Stornoversicherung, comes in handy. This type of insurance offers protection when unforeseen circumstances prevent your trip, allowing you to claim refunds or payouts for your travel expenses.
These policies typically cover reimbursement if you must cancel due to specific covered events, such as terrorist attacks, medical emergencies, death, inclement weather, natural disasters, and other extenuating circumstances. For added flexibility, some providers offer a "Flex" option that includes free cancellation protection and the possibility to redeem vouchers or get cashback in case of cancellation.
It's important to note that airlines do offer standalone trip insurance plans, but they usually do not reimburse miles used for booking a flight. On the other hand, if you paid for a trip using Chase Ultimate Rewards® points, you will be reimbursed in an amount equal to the monetary value of the points, but not the points themselves.
When points are transferred to airline or hotel partners, the miles or points are now with the airline or hotel and cannot be returned to the credit card company in the event of a trip cancellation. However, comprehensive travel insurance policies can reimburse you for taxes, mileage redeposit fees, checked bag fees, and upgrade fees, but they do not reimburse miles directly.
Domestic and foreign airlines that have U.S. websites and market to U.S. customers are required by the U.S. Department of Transportation to offer a full refund if a trip is cancelled within 24 hours of booking. This rule, however, does not apply to travel booked using points.
In recent years, airlines and hotels have loosened change/cancellation fees, but it's always a good idea to check the terms and conditions of your booking. If you want to get your miles back in the event of a cancellation and did not purchase the add-on travel insurance option offered by the airline, consider a comprehensive travel insurance policy.
Premium travel cards like the Chase Sapphire Reserve and The Platinum Card from American Express offer trip insurance benefits, including trip cancellation and interruption insurance, for trips paid with points. Similarly, various American Express cards, such as The Platinum Card® from American Express, offer trip cancellation and interruption insurance for trips booked with Membership Rewards points.
When booking travel through the American Express Membership Rewards site, you will be reimbursed in cash (regardless of whether you paid with cash or points). To be eligible for coverage, the trip must include round-trip travel to a city that isn't the cardmember's city of residence and cannot exceed 365 days away from home at the time of departure.
United offers a travel insurance option for $27 with Travel Guard to cover an award trip, with the miles being deposited back into the customer's United MileagePlus account and a reimbursement for taxes and deposit fees. If you book a nonrefundable flight through the AmEx Travel portal, you can purchase Trip Cancel Guard as an add-on, which will get you a reimbursement up to 75% on nonrefundable airfare costs.
When choosing a travel insurance policy, consider the type of trip you booked and the coverage offered by your premium travel credit card or the airline's website. By understanding your options, you can travel with peace of mind, knowing you're covered in case of unexpected events.
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