Nowadays, many travelers have a fear that their airline will suddenly go bankrupt and they will lose lots of money that has been spent on their upcoming trip. So, there are tourists who are willing to buy an insurance plan with special financial default coverage. If you belong to this group, we recommend you to think twice before you make such a purchase.
You see, it might seem like a good idea to buy that kind of coverage for extra safety. But in reality, insurance carriers that can offer plans which cover financial default are different. Some of them are definitely not worth dealing with. That is why you must read the fine print when you choose your travel policy. Some insurance companies just do not offer it at all.
More about financial default coverage
In general, financial default coverage is typically provided if a company stops working altogether due to any financial circumstances. And it does not even matter whether bankruptcy is officially filed or not. Obviously, you can only file your insurance claim in case your airline, tour operator or cruise line ceases operations completely. Otherwise, you may be denied coverage.
Before you pay for financial default coverage
Make sure you have reviewed the policy certificate extremely carefully before you purchase a travel insurance policy which includes financial default coverage. Read the conditions stated in the agreement several times. Be wary of travel insurance policies that offer just basic coverage – they do not include any financial default protection. Neither does the standard insurance plan offered by most airlines.
Tip: Do not trust your tour operator or airline to provide you with all travel insurance. Buy a policy from a disinterested third party instead
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