Jet fuel shortages caused by ongoing disruptions to the Strait of Hormuz are likely to be felt in the coming months.
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As of early May, European airlines have already slashed a whopping 13,000 flights. While American carriers haven’t started cancelling routes, airfare has started to skyrocket in response to jet fuel prices—which averaged around $180 per barrel last week, according to Fortune.
So, what happens if a serious jet fuel shortage hits the travel world?
Flights could be canceled or rerouted. Smaller regional airports might even shut down.
But one way that travelers could feel the pinch is with travel insurance companies. Should a fuel shortage arise, insurance companies could list canceled and rerouted flights as a known event—meaning you won’t get a dime back if you attempt to file a claim. Here’s what we know.
Jet fuel costs: a ‘known event’ for travel insurance companies
In the travel insurance world, known events or foreseeable events aren’t eligible for claims. And for many baseline travel insurance policies, issues like jet fuel shortages are classified as known events.
In other words, a standard plan won’t let you make a claim for flights or disruptions caused by jet fuel shortages. Aside from classifying the shortages as a known event, other insurance carriers have simply deflected to the airline, clarifying that it’s the airline’s responsibility to provide reimbursement for delayed or canceled flights.
This falls under the ‘operational issue’ clause, just like mechanical issues would. In these cases, the airline must compensate and rebook flights for the traveler. And an insurance company won’t be paying out for those delays, including hotels and meals.
So, what can travelers do to protect themselves this summer, when jet fuel shortages are expected to cause widespread delays and cancellations?
According to InsureMyTrip, a travel insurance company with a wide range of plans, the best way to get total coverage is to opt for a CFAR or Cover for Any Reason policy—the most comprehensive (and expensive) of the lot. On top of that, don’t expect coverage for travel anxieties—only for actual cancellations and delays.
However, know that in the United States, airlines are responsible for rebooking (or refunds) if a flight is delayed—even if it’s caused by a foreseeable jet fuel shortage. In the meantime, don’t buy a standard travel insurance policy thinking it will cover you in the event of cancellations or delays. Only a comprehensive CFAR policy will do that.
