Insurance: How does credit card trip cancellation/interruption insurance work?

Trip Cancellation Insurance and Trip Interruption Insurance are two types of coverage that credit cards sometimes offer.

With these coverages, you could be reimbursed for all expenses that are normally non-refundable, should your trip be:

• cancelled before departure (cancellation insurance)
• interrupted after it started (interruption insurance)

Trip cancellation insurance can be triggered under certain conditions:

• between the moment you book your trip
• and BEFORE it begins

Trip Interruption Insurance may be triggered under certain conditions:

• during your trip
• and before the scheduled return date

The trip cancellation/interruption insurance offered by credit cards protects:

• credit card holder
• Close family travelling with the credit card holder (will vary depending on each credit card)

As a general rule, insurance may apply to the principal holder, their spouse and their dependent child or children.

To be covered by your credit card ‘s Trip Cancellation/Trip Interruption Insurance, you must have paid in full for the trip with your credit card ((except for certain cards such as the National Bank’s World Elite Mastercard^®, which requires partial payment, or the Scotiabank Gold American Express^® Card, which requires 75% of the cost of the trip to be charged to the card).

The trip cancellation/interruption insurance offered by credit cards WILL COVER:

• The Insured Person’s Medical Emergency
• The insured person’s death
• The insured person’s relative’s (family, work partner) medical emergency
• The insured person’s relative’s death
• The insured person’s host’s death (at destination)
• A government warning, after your travel purchase, advising travellers not to travel to the intended destination
• Loss of employment or transfer
• An event rendering the insured person’s principal residence uninhabitable or the insured person’s business place unusable.
• The delay of a private car or a carrier due to external conditions (traffic accident, bad weather, roadblock, etc.) preventing an insured person from starting their trip (trip interruption insurance only).

Finally, some credit cards do not cover specific countries or even certain regions of a country.

In order to know if the country in which the rented vehicle will travel is covered, it is up to you to:

• consult the booklet detaling the coverage provided with your card
• or call the card issuer in case of doubt

The coverage provided by your credit card will depend on the date of cancellation/interruption of your trip and the expenses incurred as a result of this trip.

For trip cancellation insurance, you could:

• be reimbursed for the non-refundable portion of your travel expenses (up to a certain limit).

For trip interruption insurance, you may:

• be reimbursed for the non-refundable AND unused portion of your travel expenses (up to a certain limit);
• be reimbursed for the costs incurred by your hasty return.

Compensation will vary depending on credit cards

• between $500 and $2,500 per insured person
• with a maximum amount for the whole family

Need to cancel your trip? Or do you have to interrupt your trip en route?

You will need to contact your credit card insurance company as soon as possible to make a claim. Trip Cancellation/Trip Interruption Insurance covers you for all non-refundable parts of your trip up to a certain limit.

If you cancel your trip well in advance, there is a good chance that many parts can be reimbursed directly without using the insurance (e.g. hotel or car rental that can be cancelled without charge). And you’d have a better chance of getting your airfare refunded without going over the maximum limit.

Make sure you have all supporting documents on hand:

• Flight tickets
• Hotel reservations
• Car rental booking
• Medical records

Not all credit cards are equal when it comes to trip cancellation/interruption insurance.

As a general rule, credit cards offering trip cancellation/interruption insurance will differ in 3 aspects:

• Coverages offered (cancellation AND/OR interruption)
• The amount covered (per person, per trip)
• Booking conditions (total or partial amount on the card)

Here are 5 credit cards that we recommend for trip cancellation/interruption insurance, based on different income levels:

National Bank’s World Elite Mastercard^® offers a number of attractive travel and purchase insurances, which we have detailed here.

Its special feature is to be valid, even if only part of the trip has been taken to account. What’s more, its reimbursements are particularly generous: up to $5,000 per insured person.

The BMO Ascend World Elite Mastercard is one of those rare credit cards that allows partial payment to be covered. It’s practical for those who pay for a trip partly in cash and partly in points!

In addition, it offers excellent coverage for trip cancellation/interruption insurance:

The Scotiabank Passport™ Visa Infinite* Card charges no conversion fees for foreign currency transactions. So you can charge your travel purchases such as car rental, airfare abroad without paying the 2.5% fees charged by most credit cards!

Scotiabank Passport™ Visa Infinite* Card requires an individual income of $60,000 or a family income of $100,000.

The BMO Ascend™ World Elite^®* AIR MILES Mastercard is one of the only credit cards to offer partial payment coverage.

In addition, it offers excellent coverage for trip cancellation/interruption insurance:

The Scotiabank American Express Gold card also does not charge conversion fees for foreign currency transactions. So you can charge your travel purchases such as car rentals and airline tickets abroad without paying the 2.5% fee charged by most credit cards!

The Scotiabank American Express Gold card only requires an annual income of $12,000.