The cost of trip cancellation policies is typically about 5% of the total trip cost.

BBC: Is travel insurance right for you?

There are a wide variety of insurance plans designed to protect travellers from taking a financial hit because of trip cancellation or interruption.

BBC: Is travel insurance right for you?

Trip-cancellation and interruption policies are very specific in the definition of perils they cover, under what circumstances and to what limits.

WSJ: Is Travel Insurance Worth the Cost?

As Mr. Hartwig suggests, trip-cancellation coverage is best for travelers who are spending a lot of money for a nonrefundable itinerary, such as a cruise or a journey involving multiple flights or modes of transportation.

WSJ: Is Travel Insurance Worth the Cost?

Generally, it is best to buy trip-cancellation insurance as soon as your itinerary is final, or within seven to 14 days of booking, to maximize your policy protections.

WSJ: Is Travel Insurance Worth the Cost?