Lonely Planet Writer

Airport delays covered in new insurance deals

Travel insurance for medical emergencies and flight cancellation isn’t new. But what is new are policies that offer compensation for types of travel snafus that haven’t been covered before.

Now you can insure against flight delays and get paid without filing a claim.
Now you can insure against flight delays and get paid without filing a claim. Image by Braden Kowitz / CC BY-SA 2.0

Last year, Berkshire Hathaway — the brand made famous by billionaire investor Warren Buffett — moved into the travel insurance business with Berkshire Hathaway Travel Protection. One of its signature products is AirCare, a policy that pays a flyer if his or her domestic US flight hits snafus.

For instance, if a policyholder’s flight is late, AirCare will pay $50. If the traveler misses a connecting flight because the first one arrived late, the policy pays out $250. To file a claim, a traveler takes a picture of their boarding pass and sends it to the company.

If a flight is delayed on the airport tarmac while waiting for takeoff for more than two hours, a passenger can receive $1,000. The company tracks the flight and sends the flyer the money automatically without him or her having to file a claim.

Flight delay or cancellation insurance is the latest innovation.
Flight delay or cancellation insurance is the latest innovation. Image by son Tester Guerilla Future / CC BY-SA 2.0

If an airline takes more than 12 hours to deliver a passenger’s luggage to a destination after the scheduled flight arrival time, the policyholder can get $500 in compensation. In an unusually paper-free claim process, the passenger takes a photo of their airline-issued baggage claim form and sends it to the insurer to request the money.

The cost of AirCare policies starts at $25 for domestic US itineraries. The fine print: Only US residents can buy these policies, and AirCare is not available to residents of all 50 US states yet.

Travellers at UK airports face delays ever summer with Portugal a particular bad destination for flight either being cancelled or not taking off on time
Travellers can insure against delays, cancellations and price changes. Image by Mark Hodson Photos / CC BY 2.0

Another innovation from insurers is protection against the cost of an airfare rising.

The startup OptionsAway sells policies that let a traveler hold  today’s price for a domestic US plane ticket for 2, 3, 7, 14, and 21 days. If prices for that flight rise (as they often do), a traveler will still be able to buy the locked-in price. If the airfare drops, a traveler enjoys the new lower price. Whatever happens, there is no obligation to buy the ticket.

The fee OptionsAway charges varies by the type of flight. On a recent search for a round-trip ticket between Chicago and Houston in July, OptionsAway offered to lock in the lowest round-trip fare for 3 days for a fee of $32. But the cost of guaranteeing the fare of a round-trip between Dallas and Seattle for a week was more: $41.

In May, another US startup, Flyr, began selling similar price protection guarantee. As of publication time, it only offered policies on a small number of US routes. But it plans to expand in the US and Europe.