Southern California wildfires impact on travel insurance

The California wildfires are taking an incredibly tragic toll on the Los Angeles community.

The tourism industry is one of the biggest economic drivers in the area. Those who are planning trips out west might consider travel insurance to protect them from the impact of the fires or other natural disasters.

Many people don’t even consider travel insurance unless they’re going overseas or taking an expensive cruise. But situations like this make insurance a more attractive option, no matter the destination.

So here’s what you need to know.

“If we look at what’s happening here, we look at what happened in western North Carolina. We look at the hurricane patterns in the last few years, it just seems like an awful lot going on,” said Jeff Rolander, VP of Claims for Faye Travel Insurance.

That’s making travel more challenging and trip planning more of a risk so you might consider travel insurance to cover the unpredictable.

You can get just a base policy that covers certain items in certain situations or a “cancel for any reason policy,” known as a CFAR. Those policies have become more popular in recent years, especially after the COVID-19 pandemic.

“Doesn’t have a list of triggers. You can decide whatever, for whatever reason. You don’t need to even give a reason. You could just cancel your trip and be reimbursed,” said Rolander.

A CFAR is often offered as an add-on or upgrade to a standard travel policy, but it’s expensive — about 50 percent more.

According to Nerd Wallet, travel insurance is about 7 percent of the cost of a trip so expect to pay $350 to insure a $5,000 vacation. Add the CFAR and you’ll pay another $175.

Without a CFAR, policies generally provide refunds for cancellation if you get sick, lose a job, or if a natural disaster disrupts your plans.

“For customers who’ve already purchased a trip to LA or are leaving from LA, there are some protections that travel insurance might be able to provide them,” he said. “Like if somebody’s home or destination becomes uninhabitable due to a natural disaster.”

Or if an airport is shut down.

Many policies also cover mandatory evacuations.

But before you buy, make sure you read the fine print so you understand what’s covered, and make sure you purchase from a reputable company that has 24/7 assistance.

“So look at their ratings. You’re buying a promise. So it’s important to remember that. And you want to work with a company that’s going to fulfill that promise,” said Rolander.

Of course, you have to buy travel insurance in advance of a trip so for instance. If you have a trip planned to Los Angeles for next week but didn’t already buy insurance, you can’t get coverage now but it is something to consider for your next vacation.