to decide or announce that (a planned event) will not take place.
Firstly, what actually is Cancel For Any Reason or CFAR? Cancel for Any Reason is an optional travel insurance add-on that allows a traveler to cancel for any reason whatsoever and still receive a significant refund- yep, you read that right, ANY REASON.
If you are planning a trip domestically or overseas in the next 12 months, then travel insurance is a must, plain and simple. But what happens when standard travel insurance is not enough, COVID-19 has added an extra level of uncertainty to vacation planning, and as the world slowly awakens from its tourism slumber there will be false starts, but travel insurance covers that right? The answer - not necessarily.
Many insurance companies are finally catching up with the modern traveler and have introduced travel insurance plans with benefits surrounding COVID-19, but they would not provide cover if you were reluctant to travel, or if you felt unsafe travelling to a destination. These are just typical examples why you may decide not to travel this year. In this article we review why Cancel For any Reason might be right for you, so let’s look at the good, the bad and the details.
What's Good About it?
While most traditional travel insurance policies do have a trip cancellation benefit, this benefit needs to be `triggered' by a specified reason. These reasons are set out by the insurer, meaning that the things that are important to you, that may affect your ability to travel, may not be seen in the same way by the insurer- they set the rules. CFAR lets you plan for the future while avoiding the stress of the financial worry of canceling a domestic or international trip.
Reason that are often coverage by a primary travel insurance policy look more like this;
You, a family member or traveling companion become sick, injured or die or require medical evacuation.
A hurricane or other natural disaster damages your home or your destination.
A terrorist event occurs at your destination within 30 days of your arrival date
You’re laid off from work.
Your travel document is stolen.
These are pretty extreme events, and ones that we hope will never happen, but what if the reason you want to cancel your travel is not so extreme, what then? Causes to cancel such as; fear of travel due to the Coronavirus pandemic, a sick pet or friend, or not feeling fit to travel for mental health reasons are not covered under primary travel insurance policies.
Does this mean you shouldn’t be planning a future trip- heck no! CFAR allows you to dictate the terms of the trip insurance cancellation while giving you peace of mind that things can change, and you'd be prepared regardless.
CFAR insurance is in additional to you primary policy meaning you still get all the benefits of medical expenses and medical coverage, medical evacuation, medical repatriation and much more if you don't need to cancel.
What's Bad about it?
Cancel for any reason allows you to confidently plan and book future trips, with the added protection of being able to change your mind knowing you can get the majority of your money back. However, the key word is majority, as insurance suppliers differ in their interpretation of this, Seven Corners, for example, offer up to 75% back of your non refundable cost.
The best things in life are free but the best things in travel insurance are definitely not. CFAR will add anywhere from 5% to a whopping 60% to your travel insurance cost, with the average amount sitting around 25%.
Let's put that in context using Seven Corners as an example. You book a $15,000 USD family vacation and your primary travel insurance costs $500.00. If the CFAR is 25% that’s an extra $125.00 on insurance alone, insurance that you might not even use!
However, if you do need to cancel that’s potentially $11,250.00 USD back to you- no questions asked. That's a great return on your investment if you have any disinclination to travel, whether that be; work commitments, a cancelled event, impromptu family reunion or simply just a change of mind- it's all covered.
The Details you Need to know about CFAR?
Clients worldwide have been asking for coverage like this for years, so when something seems this good there has to be a catch. There is no catch per se, BUT, there are some prerequisites to be able to take advantage of this product:
1) CFAR is time sensitive and must be purchased within 14- 21 days of your initial trip deposit, this cannot be added at a later time.
2) You must confirm the cancellation of your trip no less than 48 hours prior to your scheduled departure date.
3) You must insure 100% of all prepaid, non-refundable trip costs.
Do I Actually Need Cancel For Any Reason?
Trip cancellation insurance without a “cancel for any reason” upgrade provides insurance coverage for a large range of problems- mainly the worst case scenarios. If your main worries are already listed as "covered reasons" in a standard trip cancellation policy, e.g. the sickness of a close family member, then you may not need CFAR. Travelers who purchase CFAR choose it for the added protection and the flexibility of being able to change their plans.
My Grandpa used to say “Only gamble what you can afford to lose”, so if your vacation is low cost, in a few weeks time, and you are happy to accept cancellation fees, then CFAR may be surplus to requirement.
According to a recent 2021 report, Americans spent over $101 billion as international travelers on their summer vacation this year alone, that’s a lot of money and depending on when you are planning your trip for, where you are visiting, how much you invested, why you are travelling and how you are planning on getting there, your portion of that $101billion could be significant, CFAR reduces the gamble on the unknown.
The Final Word
To answer the question “Do I Need CFAR?”. Maybe. Talk to your Travellist, explain your personal situation and concerns, they can guide you to the policy and products that best suit your scenario, paying a lot of money for a product doesn’t mean you're getting the best. Your Travellist can easily assist with giving you peace of mind, knowledge about what you are actually purchasing and the confidence to plan for the future.