Is it really Cancel For Any Reason?
Sep 12, 2019 | Aon
Travel protection has typically been designed to protect against unforeseen events. However, with situations such as the recent tourist illnesses and deaths in the Dominican Republic, the industry is seeing a greater demand for Cancel For Any Reason (CFAR) option.
What is CFAR? It’s the only travel protection benefit that allows a traveler to cancel for any reason at all, and that includes the fear of something happening. For example, travelers with this type of coverage who were bound for the Dominican Republic may have seen reimbursement in the form of cash, credits or a percentage of their trip cost in return for deciding to revise their travel agenda or cancel the trip completely.
Cancel For Any Reason products are designed to address a wide range of travel concerns. While not offered on all travel protection plans, some offer CFAR benefits with the plan, or as an upgrade. Either way, it’s important to note what percentage of the trip might be either refunded in cash or returned in a credit, as those terms can vary dramatically.
A traditional ”named peril” travel insurance plan, where coverage is triggered by specific causes of a loss listed in the policy, is primarily based on trip cost. However, the price may also vary based on a variety of factors including level of coverage, type of travel, destination, and in certain cases, the age of the traveler. On average, plans based on trip cost are priced between 5 – 7 percent of the total trip amount. The CFAR benefit offers an immense amount of flexibility compared to that of standard plans, so the CFAR benefit can cost up to 40 percent more. This is when a traveler needs to consider the total investment made for a trip relative to the cost of protecting it.
The good news for travelers looking to protect their trip, is that there are more options in the market than ever before. Between travel supplier plans, credit card insurance options and the many travel insurance options available, consumers have their full choice of plans. However, it is very important to read through the fine print to understand the terms of the specific plan being purchased. Sometimes, travelers incorrectly assume that Trip Cancellation automatically includes a cancel for any reason benefit; however, not all plans offer an option to purchase Cancel For Any Reason coverage. Knowing what coverage you have can provide some peace of mind, in case the unexpected happens.