How cancellation insurance works: a guide from A to Z

What cancellation insurance is

If you cancel a package holiday, stay, ticket or course you’ve paid for, the seller keeps part of the money or all of it. This amount is called a cancellation fee. For a package holiday just before departure it’s often up to 100% of the price; with tickets and non-refundable bookings, you lose the full price whenever you cancel.

Cancellation insurance pays back most of that cancellation fee — if you have to cancel for a serious reason beyond your control that’s listed in the policy terms: typically illness, injury or a death in the family. It isn’t insurance “in case I don’t feel like going”. The insurer only pays if something you couldn’t influence or foresee gets in the way. If you’ve already set off and have to interrupt the trip for a covered reason, it reimburses a proportionate part of the unused services.

Cancellation insurance vs. travel insurance

The two are often confused, but they deal with completely different situations:

Travel insurance that comes with a payment card, or an annual travel policy, often doesn’t cover cancellation at all, or only for package holidays. With us, you buy cancellation insurance on its own, including for services that aren’t trips — a concert, course or conference.

What you can insure

Domestic and international trips, private and business — as long as you’ve concluded a booking contract or binding order with the provider, or paid in advance. It doesn’t matter where you bought it:

• Trips and holidays — package holidays, flights, independent trips
• Flights — non-refundable flights and independent trips
• Accommodation — hotels, cottages, apartments, Booking.com, Airbnb
• Tickets and events — concerts, festivals, theatre, sport, race entries
• Courses and education — language courses, workshops, training
• Camps and ski trips — children’s camps, school ski trips, outdoor school trips
• Corporate events — conferences, team-building, training

Online, you can insure a price from CZK 300 to CZK 500,000. The payout limit is the total trip price, up to CZK 500,000 per person and policy. For more expensive purchases, we’ll prepare a personalised quote.

Reasons the insurance pays out for

The policy terms list 14 reasons. Illness, injury and death also apply to your family — a partner, children, parents, siblings, grandparents, a partner’s parents, a daughter-in-law, a son-in-law and other relatives you live with in the same household or demonstrably care for. The reason must arise no more than 30 days before the planned departure; for illness, injury, death and pregnancy, up to 180 days before. For each one you’ll need a document:

You’ll find details on each reason on the What cancellation insurance covers page.

What the insurance doesn’t cover

• Known in advance: Cancellation fees that could reasonably have been expected or that were known about before the insurance started.
• Travel against Foreign Ministry advice: Travelling despite the Czech Ministry of Foreign Affairs strongly advising against it, or in breach of the entry requirements published by the destination country at the time of departure.
• Situation in the destination country and pandemics: A worsened or long-term poor geopolitical, climatic or environmental situation, the closure of airspace or a pandemic. The insurer may relax these conditions through a so-called Public Commitment.
• Trip changed or cancelled: If you, the carrier or the provider change the travel plans or cancel the trip. A cancelled event or package holiday is a matter for the organiser.
• Time off, worries, reluctance: If you don’t get time off work, are worried about travelling or don’t want to go.
• Resigning yourself: Employment ended by your own decision.
• Refused carriage: Being refused carriage for reasons other than health reasons.
• Pre-existing health problems: A medical condition, illness or injury that already existed before the insurance was taken out. A stabilised chronic illness is an exception.
• Against medical advice: A trip taken contrary to medical advice.
• Advanced pregnancy: Pregnancy after the 26th week, or a voluntary termination of pregnancy within 3 months before departure.
• Mental illness and self-harm: Suicide or attempted suicide, all forms of mental illness, deliberate self-harm or exposing yourself to danger (except to save a human life), and post-traumatic stress disorder that did not arise directly from an injury.
• Alcohol, drugs, medication: Events under the influence of alcohol above 0.8 per mille, drugs or medication without a prescription, or medication taken contrary to the manufacturer’s instructions.
• HIV and sexually transmitted diseases: Events connected with acquired immunodeficiency syndrome (AIDS, HIV) and other sexually transmitted diseases.
• Driving without a licence, flying: Driving a vehicle, vessel or other craft without the relevant licence, and flying of any kind except as a fare-paying passenger.
• Intent and criminal activity: Damage caused intentionally by you or by another person at your instigation, or in connection with committing a crime.
• Races, professional sport, expeditions: Events while taking part in a race or competition, during professional sporting activity, on trips to uninhabited areas and places with extreme conditions, or on expeditions.
• Weapons, pyrotechnics, the military: Dangerous activities involving weapons (including hunting game) or pyrotechnics, and service or training in a military or police organisation.
• War and unrest: War, invasion, military action, civil war, uprisings, strikes, civil unrest, interventions by state authorities and similar events.
• Nuclear, biological and chemical hazards: Ionising radiation, radioactive contamination and the release or use of pathogenic or toxic biological or chemical substances.
• Terrorism against Foreign Ministry warnings: Terrorism, if you travelled contrary to a Czech Ministry of Foreign Affairs warning about safety at the destination.

What the insurance costs and how much it pays back

The premium is 9% of the total price, at least CZK 26 per insurance policy, and it’s a one-off payment. If you cancel, you get the cancellation fee minus the 10% excess (with no minimum amount). Cancellation fees don’t include the premium, airport taxes or fees that can be recovered.

A worked example

A family pays CZK 36,000 for a package holiday and insures it for CZK 3,240. Ten days before departure, their son falls ill and the tour operator keeps 80% — CZK 28,800. The insurance pays back CZK 25,920 (the cancellation fee minus the CZK 2,880 excess). If their son had to go into hospital (hospitalisation for at least 24 hours), no excess would apply and the full CZK 28,800 would be paid back.

For a cheap CZK 890 ticket, the premium is CZK 80, and if you cancel you get CZK 801 back — the excess is CZK 89.

Work out your own amount in the calculator, or try the simulator to see how much you’d lose without insurance.

When cancellation insurance is worth it

The premium is a small part of the price, but not every booking needs it. It makes the most sense when:

• the service is non-refundable or expensive — tickets, non-refundable accommodation rates, package holidays close to departure,
• you’re buying well in advance — early booking, festival tickets or camps paid for in winter,
• several people are going — it only takes one child to fall ill and the whole family cancels,
• it’s flu season — ski trips and the mountains in winter.

On the other hand, for a flexible booking you can cancel for free until the last minute, you don’t need cancellation insurance — until free cancellation turns into paid cancellation.

When to buy the insurance

If there are more than 30 days until the trip starts, you can take out the insurance at any time. If you buy the trip 30 days or less before it starts, the insurance must be taken out at the same time as you pay for the trip. Trip cancellation cover applies from the day it’s taken out until the planned departure, and only covers events that occur after it was taken out. If you take it out when you already have a fever or know about an operation, the insurer won’t pay.

We’ll prepare the insurance for you on request: write to us with what you’re insuring, how much it cost and when it starts, and we’ll email you a quote quickly. The policy is issued on the same day. If it starts within 30 days, write to us on the very day you pay for it. The insurance takes effect once the premium has been paid. You cannot withdraw from cancellation fee insurance within 14 days without giving a reason.

How to make a claim

1. Cancel the trip and all services with the seller as soon as possible and ask for a refund — the cancellation fee usually goes up over time.
2. For tickets, send the original cancelled tickets to skody@colonnade.cz before the event starts.
3. Notify Colonnade of the claim without undue delay — at skody@colonnade.cz or on +420 800 700 025, always with your policy number. We can help you too via the online form.
4. Provide the documents: your travel contract or proof of booking and payment, proof of the refund showing the cancellation fees, and proof of the reason (a medical report, death certificate, police report, summons, confirmation from your school…).
5. The insurer completes its investigation within 3 months of notification and pays out within 15 days of completing it.

The most common mistakes that stop the insurance paying out

• Taking out insurance after the reason has arisen. You can’t take it out on the day you’re already in bed with a fever — only new events are covered.
• Taking out insurance too late. 30 days or less before the event, it can only be taken out at the same time as you pay for the trip.
• A change of plans instead of a serious reason. Not feeling like it, worries, not getting time off work — the insurance doesn’t cover these.
• A missing document. An illness needs a doctor’s confirmation with the diagnosis and length of treatment. See a doctor before the date of the event.
• Putting off cancelling. The later you cancel, the higher the cancellation fee tends to be — and the insurer may reduce the payout by whatever was added because you cancelled late.
• Tickets sent too late. The original cancelled tickets must reach the insurer before the event starts.
• Cancellation by the organiser. If the organiser cancels the event, they refund you, not the insurance.

You’ll find more answers in the FAQ and examples in the example stories.