Trip Cancellation Insurance Compared: Chase Sapphire Reserve, Sapphire Preferred, AMEX, Travel Guard

Trip Cancellation Insurance is a Key Benefit of the Chase Sapphire Reserve, and is why I, and many clients, put all our travel expenses on it. But how does the coverage compare to the Chase Sapphire Preferred? And do AMEX cards such as the AMEX Platinum and AMEX Centurion include any trip cancellation insurance? These are questions that have come up with various clients making significant non-refundable reservations in the past few days, so I thought I'd answer them. But first, a quick intro to what the coverage entails.

What is Trip Cancellation Insurance?

Trip cancellation insurance, as its name implies, reimburses you in the event your trip has to be cancelled due to a covered reason, which varies by insurance policy. The usual reasons are death or severe illness of you or your traveling companion, natural disaster or severe weather that prevents the trip, your home or travel companion's home becoming uninhabitable, jury duty or subpoena summons, and the like.

Does Travel Insurance Cover Frequent Flyer Award Flights?

Typically trip cancellation does NOT reimburse anything for frequent flyer awards, but note that usually you can cancel and redeposit these tickets. Be sure to familiarize yourself with the rules of the frequent flyer program you booked with, however, since programs such as British Airways Executive Club do not provide a redeposit option within 24 hours of departure, and Delta SkyMiles does not provide a redeposit option within 72 hours of departure, rendering such awards non-refundable.

The Chase Sapphire Reserve and Chase Sapphire Preferred do provide reimbursement if you used Chase Ultimate Rewards for part or all of the trip, so that is another benefit to using Ultimate Rewards, although for savvy travelers, getting the points redeposited is likely to be a far better deal if the value of the redemption does not appear on the confirmation, which it typically does not. That's because, if there's no value of redemption amount listed, the reimbursement is a paltry $0.01 per point redeemed.

Trip Cancellation Coverage Compared

Chase Sapphire Reserve

Eligibility: You must have a valid Chase Sapphire Reserve and have used the card to pay for at least part of the trip. The trip must be to a destination greater than 1 mile from your primary residence and be for a time period of no more than 60 days.
Who is Covered: The primary cardholder and immediate family members (spouse or domestic partner and children, including adopted children or step-children, legal guardians or wards, siblings or siblings-in-law, parents or parents-in-law, grandparents or grandchildren, aunts or uncles, nieces or nephews)
Maximum Coverage: $10,000 per Covered Person, Up to $20,000 per Trip
Covered Events:
Accidental Bodily Injury, Loss of Life, Sickness of you, a Travel Companion, or immediate family member of you or a Travel Companion
Severe weather that prevents a reasonable and prudent person from beginning or continuing on a Covered Trip
Change in Military Orders for you, your Spouse or Domestic Partner
Terrorist Action or Hijacking
Call to Jury Duty or Receiving a Subpoena from the Courts, neither of which can be postponed or waived
Finding your or your Travel Companion's dwelling to be uninhabitable
Quarantine imposed by a Physician for health reasons
Financial insolvency of the Travel Agency, Tour Operator or Travel Supplier whose services you booked

Chase Sapphire Preferred

Eligibility: You must have a valid Chase Sapphire Preferred and have used the card to pay for at least part of the trip. The trip must be to a destination greater than 1 mile from your primary residence and be for a time period of no more than 60 days.
Who is Covered: same as above, for CSR
Maximum Coverage: $5000 per Covered Person, Up to $10,000 per Trip
Covered Events: same as above, for CSR

AMEX

AMEX cards issued in the U.S., even the AMEX Platinum and AMEX Centurion, do not include trip cancellation insurance. This is a major disadvantage of using an AMEX card for non-refundable airline tickets and other non-refundable travel expenses, or for hotel stays that require upfront deposits that become non-refundable weeks (or sometimes even months) before the trip, common for resort stays and for peak holiday periods.

You can, however, purchase U.S. AMEX travel insurance, just as you can purchase other paid travel insurance.

Eligibility: You must be a permanent resident of one of the 50 U.S. states or the District of Columbia to be eligible to purchase this U.S. AMEX travel insurance. The trip cannot be to countries subject to U.S. economic or trade sanctions such as Syria, North Korea, Cuba, Iran, Iraq, etc.
Who is Covered: Only the people for whom the coverage is bought are covered, although the reasons can relate to the covered person's Family Member or Travel Companion or the Travel Companion's Family Member (only if an AMEX policy has also been purchased for the Travel Companion).
Maximum Coverage: 100% of Trip Cost (keep in mind that the policy amount will depend on the total trip cost, so more expensive trips will result in a more expensive AMEX travel insurance policy)
Covered Events: Exact AMEX Trip Cancellation policy depends on your state, but typical reasons include:
Severe injury, illness or disease that has been examined by a relevant physician, with a written opinion advising against travel, where you notify the travel supplier(s) within 48 hours of the medical exam or treatment
Adverse weather or natural disaster causing complete cessation of travel services for at least 24 hours
Scheduled Airline or Common Carrier cancellation or delay (at least 6 hours or by 12:01am the next day in the time zone where the delay occurs) due to adverse weather or labor strikes that affect public transportation
Uninhabitable residence due to fire, flood, volcano, earthquake, vandalism, burglary, natural disaster
Required to appear in court due to jury service or subpoena
Unforeseeable termination/layoff of Covered Person or Travel Companion (must have been worked at the employer at least 48 months)
Covered Person, Travel Companion or Family Member is a victim of a felonious assault within 10 days prior to departure
Direct involvement in a traffic accident by a Covered Person or Travel Companion while en route to scheduled airline or Common Carrier departure

Travel Guard

For clients that haven't paid for their trip with a Chase Sapphire Reserve or Chase Sapphire Preferred and aren't otherwise covered by trip cancellation insurance, I recommend Travel Guard Gold (the name/benefits can vary depending on which state you're from). Usually the Travel Guard Gold plan suffices, although there's also a Platinum plan, which would also enable you to purchase an additional cancel for any reason insurance policy. I don't recommend the latter though, usually, because it's so expensive and in any case typically only refunds 50% of your non-refundable prepayments.

Eligibility: You must purchase the appropriate TravelGuard plan for your state or primary residence. Eligibility conditions can vary by state; for example in Colorado, the trip must be overnight and be to a destination at least 100 miles from your primary residence.
Who is Covered: Only the people for whom the coverage is bought are covered. You'll need to provide the state of residence, birth date and trip amount for each traveler that is to be covered, in order to receive a quote.
Maximum Coverage: 100% of Trip Cost up to $100,000 (keep in mind that the policy amount will depend on the total trip cost)
Covered Events: Exact covered events can vary depending on your plan, but these are typical:
Sickness, Accidental Injury or death of the Insured, Travel Companion, Family Member or Business Partner that results in medically imposed restrictions as certified by a Physician preventing travel
Unforeseen events: being hijacked, quarantined, required to serve in a jury, subpoenaed, or having principal residence made uninhabitable by fire, flood, or Natural Disaster
Death or hospitalization of the Insured's host at the destination
A politically motivated terrorist incident that occurs within a 1 mile radius of a city listed on the Insured's itinerary, that occurs within 30 days of planned departure.
An unforeseen labor strike that causes complete cessation of travel services. A strike is foreseeable the date union members vote to approve the strike.
The Insured is terminated or laid off from work work after at least 1 year of continuous employment
Weather that causes the complete cessation of travel services
Unforeseen hurricane warning causing cancellation of travel; not payable if the hurricane is named prior to the date the insurance policy is purchased.
Bankruptcy or default of travel supplier that occurs more than 14 days after the policy is purchased