When Travel Insurance Doesn't Cover Terrorism

During an incident, travelers may not be able to turn to travel insurance

Paris On High Alert As The French Capital Recovers From The Terrorist Attacks
••• Christopher Furlong / Getty Images

For many international travelers, terrorism is a very real threat that can affect plans without warning or reason. As a result of an attack, flights can be grounded, public transportation can be stopped, and travelers can be halted at their destination on a moment's notice.

When traveling to a "high risk" or "dangerous" destination, travelers often purchase travel insurance policies prior to departure with the belief they will be covered in the worst case situation.

However, acts of terrorism may not necessarily be covered by a travel insurance policy – even when a terrorism benefit is included in the base package.

By understanding what is and is not covered, travelers can make better decisions about purchasing travel insurance. In certain situations, travelers may not be covered by "terrorism" benefits, but may still be able to receive assistance.

Situations That Do Not Qualify for Terrorism Travel Insurance Benefits​

Despite the outward appearance of an international incident, "terrorism" benefits may not cover a traveler until the situation is formally declared as an act of terrorism. Travel insurance provider Tin Leg recently announced that because the Russian MetroJet incident has not been declared an act of terrorism, benefits from their insurance policies may not cover the incident.

In another example, Malaysia Airlines Flight 17 was determined to be brought down by a surface-to-air missile in the Ukraine.

While Ukrainian officials have decried the incident as an act of terrorism, the U.S. State Department has not used the term "terrorism" to describe the incident. Therefore, terrorism travel insurance benefits may not extend to this particular situation.

Furthermore, although the U.S. State Department may extend terror warnings and alerts for different destinations, a warning does not necessarily describe an action.

Instead, a warning or alert is extended as a precaution for travelers ahead of their travel. Until an actual attack takes place, travel insurance may not honor a terror alert as a valid reason for trip cancellation.

The Extension of Terrorism Travel Insurance Benefits

Once an active terrorist attack has been identified, many travel insurance policies will allow travelers to access their terrorism benefit. For example, the attacks on Paris in November 2015 is considered a qualifying event in order to access benefits.

"The Paris attacks have been named an act of terrorism by the State Department, so insured travelers could be covered by travel insurance policies with this definition," Squaremouth CEO Chris Harvey explains. "However, their trip dates and itinerary may need to meet other requirements to be eligible for coverage."

If a traveler purchased their travel insurance policy prior to their departure and before the attacks became a known event, then travelers may be able to access their benefits. Depending on the policy purchased, travelers may be able to cancel their trip, have incidental expenses covered, or evacuate the situation to their home country.

What Benefits Are Available in an Emergency Situation?

In the event of an emergency, travelers still may be able to use certain benefits as part of their travel insurance policy.

If the emergency falls into a qualifying category prior to departure, then travelers may be able to receive refunds for their non-refundable expenses through a trip cancellation benefit. If transportation channels are cut-off or grounded as the result of an emergency, travelers may be able to receive reimbursement for incidental expenses through trip delay benefits. If an emergency requires a traveler to immediately return home due to a weather event or the injury of a companion, then travelers may be able to receive assistance through trip interruption benefits.

Finally, for those travelers who are concerned about the safety of their destination, a Cancel for Any Reason policy can help travelers receive reimbursement if they no longer wish to travel. Under Cancel for Any Reason, travelers can receive a partial refund in the event they decide to cancel their trip for an unqualified reason.

Although travel insurance benefits can cover many different situations, terrorism is a gray area that may not yet be covered. By understanding what travel insurance will cover prior to purchasing, travelers can make better decisions about their policies prior to boarding.