Travel Insurance: Your Refund Rights for Flight Delays and Cancellations

Travel insurance can help you make up for financial losses stemming from a flight delay or interruption, but not all claims may be honoured. Here’s what you need to know to increase your chances of a successful claim.

One of the most useful benefits of a travel insurance plan is the ability to receive monetary compensation if your holiday plans are thwarted. Whether due to severe weather, technical difficulties or a plain mix-up, you’re suddenly grounded at the airport instead of soaring happily through the skies.

Well, if you have a travel insurance plan, you can submit a claim to your insurer to help offset some of the money you may have lost (although, can anything truly soothe the pain of being so cruelly denied the promise of a long-awaited overseas vacation?).

Here’s a breakdown of how a travel insurance plan may cover you in the case of a flight interruption, as well as what you should note in order to increase your chances of a successful claim.

How does a travel insurance plan protect your flight?

A travel insurance plan provides a payout in case of a flight disruption, such as if the plane is delayed for a stipulated duration, or if the flight ends up being cancelled altogether.

This compensation is useful for covering any additional expenses that may arise from the disruption. For instance, if your onward flight to your next destination, or back to Singapore, is postponed, you may need to book an extra night’s stay at a hotel, as well as incur other expenses such as meals and other amenities.

Similarly, should your airline cancel your flight, you may not get a refund; this can happen in certain situations, such as a natural disaster. Your travel policy will cover the costs of the new plane tickets you had to book as a result, up to the specified limits – and only if the underlying reason is covered by your policy (more on this later).

Other non-refundable expenses you may be able to claim include hotel bookings, attraction tickets, and other prepaid items. These would usually be listed as separate benefits in your travel policy.

Key terms to know: Travel delay, travel curtailment, travel cancellation

Your insurer may use slightly different terms, but generally, when it comes to how your travel policy covers your plane tickets, there are three main definitions to know and understand.

Travel delay

Most travel policies offer a travel delay benefit, which is claimable if your flight fails to take off on time, but has not been cancelled outright. However, not just any delay will do. To be claimable, the delay would have to be for a significant duration – typically at least six hours.

You may be covered for something like “S$200 per 6 hours of travel delays”, up to the cap indicated in your policy. Note that the minimum duration stated in your policy will have to be reached for the claim to be valid.

So for instance, if your policy only pays out for delays six hours or longer, your claim may not be successful if your wait was shorter, say five hours.

Hence, if you are travelling in a region or season with a heightened chance of flight delays – such as during typhoon season in Japan, where there may be increased risk of airport closures – you’ll want to pay attention to the travel delay benefit in your policy.

Also, don’t confuse travel delay with luggage delay. The latter is the benefit you can claim if your checked luggage goes missing and fails to show up when you disembark from your flight.

Travel curtailment

A travel curtailment is when you are unable to continue your trip, and have to return home earlier than scheduled.

In this case, you may have to book new plane tickets (if your airline doesn’t allow you to change the date of your flight), and also forego unused accommodation and other items you have already paid for. Your travel policy can cover these financial losses, up to the specified limit.

Now, note that you will only be covered if you cut short your trip for reasons covered in your travel policy. These typically include serious illness or injury to you, your travelling companions or named family members only; natural disasters; unexpected strikes, civil unrest, or terrorism.

Travel cancellation

Travel cancellation benefits kick in should you be forced to cancel your trip. You can make a claim on expenses for which you were unable to obtain a refund, again, up to the limits specified in your travel policy.

Note that a trip is considered cancelled only if you were unable to embark on your trip.

For instance, after booking your plane tickets to Bali, a volcano eruption caused a closure of the airports. Authorities are unable to determine when it would be safe for flights to resume, so you decide to cancel your holiday.

In this case, you can make a claim under your policy’s trip cancellation benefits.

Making a travel insurance claim for delays, curtailment or cancellation

For the most part, making a claim against your travel policy is pretty straightforward – you’ll need to gather the supporting documents such as receipts and official statements, submit them along with your claims, and wait for your insurer’s reply.

However, there are some finer points to the process, and being aware of them can help you increase the chances of your claims being awarded.

Approach your airline first

If your flight has been delayed or cancelled, you should first attempt to seek compensation from your airline. You may be offered a refund, vouchers for future flights, or reimbursement for meals and hotel bookings.

Be sure to get the airline to provide an official statement confirming the flight disruption, the reasons for it, and most importantly – an acknowledgement of refusal to provide refunds or compensation.

This will clearly show your insurer that you have tried – and failed – to seek damages from your airline.

However, if your airline does offer some compensation, be sure to include it in your submission. You can then ask your insurer to make a reimbursement for the shortfall not covered by your airline, a request that your insurer may be more amenable towards.

Check the exclusions in your travel policy

Not all travel plans are created equal, and different insurers may cover different things. When choosing a travel policy, it is a good idea to check the policy’s exclusions.

You can find this information in the Policy Wording, which is usually available online via your insurer’s website.

Pay attention to the circumstances or events under which your insurer does not pay out. You may be surprised to find that some travel plans do not cover flight delays due to mechanical failure (which, arguably, is the most common cause of delays!).

Also, be clear of how your insurer differentiates between adverse weather events (such as thunderstorms and high winds) and natural disasters (such as a volcanic eruption).

Both can cause flights to be cancelled or delayed, but insurers may choose to pay out only for the former, and not the latter.

Know your sub-limits

Yes, travel insurance policies don’t exactly make for light reading, and it can be pain delving into all the details.

However, it is important to know your travel policy comes with sub-limits which means your payout may be less than you expect.

For instance, while a certain policy may claim to offer up to, say, S$15,000 for travel cancellation, that doesn’t mean you should expect to be reimbursed the full cost of your business class ticket.

This is because your policy may have a sub-limit on plane tickets, which may only cover a portion of what you paid.

The bottomline: Know your travel policy before signing up

The thing to be aware of is that there are no standard definitions or practices when it comes to travel insurance, and your coverage can differ in not-insignificant ways from one insurer to another.

This difference is not only in the sums you are covered for, but – as discussed above – the scenarios under which your claims are admissible, or not. Afterall, it’s useless to have a large sum assured, only to find it only covers a narrow set of circumstances.  

Therefore, it is best to spend some time delving into the nitty gritty details of a travel policy you’re interested in before committing to a purchase. You can ask for a copy of the Policy Wordings, or contact the insurer directly with your questions.

This is especially important if you have specific needs or concerns, or are planning a particularly long holiday where the risk of something going wrong is increased.

Read these next:

Travel Insurance Guide: Five Things All Travellers Must Know

Travelling to These Countries? You’ll Need to Have Travel Insurance

Best Annual Travel Insurance Plans In Singapore (2023)

Best-Priced Travel Insurance: FWD, Starr, Singlife, Allied World

Best Senior Travel Insurance For Elderly Travellers (2023)