“Cancel For Any Reason” (CFAR) coverage is usually an add-on feature to a trip insurance policy. CFAR ensures that travelers receive a refund if their travel plans are canceled for any unforeseen reason.
What Cancel For Any Reason Travel Insurance Covers
Travelers choose a coverage amount ahead of time. The policy covers up to that amount for pre-paid and non-refundable expenses and deposits if the trip must be canceled for any reason. This includes any incident that may not be covered under the typical trip cancellation clause. Since CFAR is more extensive, it should not be confused with trip cancellation insurance and should not be passed up for that reason.
Do not make the expensive mistake of assuming that CFAR automatically covers every penny of non-refundable expenses. Different plans cover different percentages. Always read the terms of the policy carefully to find out what percentage is covered. While some may cover 75 percent, other companies may only cover 60 percent. For a long expensive trip with many deposits and prepaid costs, this results in major differences of reimbursement rates. Higher percentages come with higher fees.
The peace of mind may be worth it to travelers who have invested a considerable amount of money in their plans. If there is a sizable risk of cancellation for multiple reasons, this coverage may be a wise investment. Travel insurance companies also have per-person limits for CFAR. Be sure to read these and ensure that they are in line with personal needs before choosing a policy.
Note that the trip must be canceled within a certain number of days before the planned trip and you typically need to insure 100% of your trip costs. In addition, CFAR is typically only available if you purchase the policy within a set amount of days (7 to 30 depending on the policy) of your initial trip payment date.
Choosing The Right CFAR Policy
Compare plans from different providers to explore options. Make a list of personal needs to use as a guide for selecting an ideal plan. After purchasing one, write down the following summary:
- The overall coverage limit
- The per-person coverage limit
- The penalty or coverage percentage
- The trip cancellation deadline
When buying trip insurance online, print a copy of the terms. Also, take along the insurer’s contact information, the policy ID and a coverage summary.