• Bankruptcy - means the filing of a petition for voluntary or involuntary bankruptcy in a court of competent jurisdiction under Chapter 7 or Chapter 11 of the United States Bankruptcy Code 11 U.S.C. Subsection 101 et seq.
• Financial Insolvency - means the total cessation or complete suspension of operations due to insolvency, with or without the filing of a bankruptcy petition, or the total cessation or complete suspension of operations following the filing of a bankruptcy petition, whether voluntary or involuntary, by a tour operator, cruise line, airline, rental car company, hotel, condominium, railroad, motor coach company, or other supplier of travel services which is duly licensed in the state (s) of operation other than the entity or the person, organization, agency or firm from whom you directly purchased or paid for your Covered Trip. There is no coverage for the total cessation or complete suspension of operations for losses caused by fraud or negligent misrepresentation by the supplier of travel services.
• No Default Coverage - means a claim for trip cancellation/interruption cannot be filed if your travel provider ceases operations
• No Insurance Will Be Issued - means insurance company has decided not to issue a policy/certificate if your trip includes one of the listed travel providers
• Travel Supplier - means an airline, cruise line, tour operator or rental car company that supplies travel services to you while you are taking your trip. Travel Supplier is not a travel agent who simply assists in making your travel arrangements.

Make sure you are covered for bankruptcy in the first place. Look for policies that include coverage for “financial default of travel provider”. This coverage is provided usually in the event of a complete suspension of operations due to financial circumstances whether or not bankruptcy is filed. Employee Strikes may also be covered under this provision.

Most plans require you to purchase insurance within 15 days of your trip deposit (others may require a 10 or 21 days so don’t wait too long or you will not be covered). It is also common to have to wait for 14 days after purchasing to be able to file a claim for reimbursement. The reason for this is insurance companies want to make sure you bought insurance for precautionary reasons and not on the fly as soon as the 5 o’clock news announced your airline has completely shut down its operation.

Lastly and most importantly you need to make sure that your travel supplier (airline in this case, but can include cruise or tour company) is on the list of covered companies with your travel insurance of choice.