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Travel in the time of a pandemic is not a very appealing prospect for most of us. But with talk of possible vaccines by the end of the year, you may look forward to travelling farther afield than the hiking trail down the street. With the course of the coronavirus as unpredictable as ever, you’d be wise even when booking trips far in the future to cover your backside if you need to change or cancel your plans. Take these steps to prevent financial pain if you must change your plans.

Dave Gardner

Book with travel providers with generous cancellation policies. With hotels and rental cars, there are generally booking options that give you the choice to cancel your reservation just days before you’re scheduled to go. You may have to pay more for this flexibility as travel booking sites often extend discounts for nonrefundable reservations.

While Airbnb did step up and provide refunds to many travelers with the onset of the pandemic, its extenuating circumstances policy generally does not apply for new bookings. Hosts can offer a variety of cancellation policies through Airbnb, and you can search for properties with generous ones with a specific filter. Properties available through VRBO tend to have less-uniform policies with its vacation rentals, so carefully read the policy and the contract of the host to know your rights.

Airlines are notorious for their lack of flexibility if your plans change. Of the three biggest carriers at DIA, Southwest has historically offered the most liberal terms for changing your reservation. Even before the advent of COVID-19, Southwest allowed you to cancel your reservation up to 10 minutes before your flight and then apply those funds toward a new flight within one year of the date you bought the ticket. Now Southwest has temporarily enhanced policies that could permit you to delay using unused travel funds through September 2022 or beyond if the credits are converted to frequent flier points.

Before the pandemic United Airlines had change fee policies in place for most tickets, often in the hundreds of dollars. They have loosened these restrictions during this time giving passengers up to two years from when they booked their original ticket to use their travel credit. It’s unclear what United’s policies will be for new tickets once we get to August. Frontier also has modified its change policies, which tend to be more generous the more advanced notice you give them that you’re changing your plans.

Regardless of which airline you book with, change policies are seemingly in constant flux. Take a picture of the airline’s change policy when you book your tickets so you have that record if needed if you want to alter your itinerary.

Travel insurance. Many travelers caught with nonrefundable bookings over the last few months have found out that the terms and conditions of their travel insurance policy matter. More than most insurance products, not all travel policies are created equal. They tend to have many loopholes that are not drafted to be traveler-friendly. The answer is to purchase Cancel for Any Reason travel insurance policies directly with an insurance broker. Policies offered through the airlines and other travel providers tend not to be as comprehensive.

Typical travel insurance will cost 4 to 8% of the nonrefundable portion of the trip, while CFAR benefits can add an additional 50% to the cost of the policy. Often you must purchase insurance soon after you book your travel, typically from 2 to 3 weeks from when you make your original trip payment. It’s important to note that you must insure all nonrefundable trip costs. Then if you need to cancel your trip, you may do so regardless of whether it’s due to the pandemic or the schedule or health of the travelers. If you need to cancel your trip you only receive a refund of 50 to 75% of nonrefundable expenses, so even CFAR policies are not a complete panacea. Consider looking at a reputable online travel insurance broker such as for a policy.

David Gardner is a certified financial planner practicing in Boulder County. The opinions expressed by the author are his own and are not intended to serve as specific financial, accounting or tax advice.

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