Airbnb Cancelled on You? What Travel Insurance Can and Can’t Cover

Imagine you’ve got your flight and accommodation all booked and are just packing for your upcoming trip. But you suddenly get a notification that your Airbnb host cancels just days before your trip and hotels are at a premium because it’s so last minute. Or worse, you arrive at the Airbnb listing and find that the cozy room you viewed is actually a janky shed. 

You may not get an Airbnb refund too as they sometimes have a strict cancellation policy. And you still have to find somewhere new to stay. Will your travel insurance be able to cover this instead? 

We break down what travel insurance can cover in this article.

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1. Airbnb travel insurance: what’s actually covered

Travel insurance can cover accommodation expenses when your trip is disrupted for a reason listed in your policy. It isn’t a guarantee that your Airbnb booking will go smoothly, or that your insurer will pay whenever your host lets you down.

For host cancellations, start with Airbnb’s refund and rebooking process. An insurer generally considers eligible expenses you cannot recover elsewhere, subject to the policy’s conditions.

Here’s how the plans from 8 providers compare. These are coverage for trip cancellation, not guaranteed payouts for an Airbnb host cancelling.

These travel insurance policies also provide coverage for trip postponement, missed travel connection, trip interruption, or shortening in some form or another, all of which may lead to you losing your Airbnb booking. 

You can’t claim across multiple categories if you don’t make it to your Airbnb booking but you can claim for the category that your situation falls under. First check whether the reason for cancellation qualifies, then look at how much the policy pays.

Before booking your next getaway, compare travel insurance plans on MoneySmart and check the accommodation conditions alongside the premium.

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2. If your host cancels: start with an Airbnb refund 

According to Airbnb’s policy, if your host cancels before check-in, Airbnb offers a full refund if you don’t rebook. You may receive booking credit to arrange a replacement, and can find another similar property on the platform. If you don’t use the credit within 72 hours, you’ll automatically get a full refund, which IMO, it’s kind of odd that they don’t refund immediately and give you credit for 72 hours. 

Apparently, if a host cancels your reservation after check in or if another reservation issue disrupts your stay, you’ll receive a full or partial refund and rebooking assistance, depending on the circumstances. This may also turn out to be not very beneficial to you if, say, you check in at 3pm, then your host cancels the reservation just after. 

There are also cases where a host may ask you to cancel instead. In such a case, don’t do it. Request for the host to do the cancelling so that you get the refund. Airbnb’s guide literally tells you to do so.

Contact Airbnb support if the available alternatives don’t work. If the host asks you to cancel on their behalf, ask them to process the cancellation instead.

Keep evidence of the cancellation, refund and replacement booking. Insurers generally won’t reimburse an expense that Airbnb has already returned. 

A pricier replacement is a separate question. Your insurer would need a relevant covered event and a benefit that pays additional accommodation costs. “My host cancelled and hotels now cost more” isn’t automatically enough.

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3. When travel insurance covers accommodation problems

1) You cancel for a covered reason and lose non-refundable accommodation costs

A serious illness or injury, or a qualifying family emergency may trigger trip cancellation cover. You’ll usually need supporting documents, such as a doctor’s report, plus evidence of the amount the accommodation provider won’t refund.

Travel insurance protects against possible scenarios or disruptions that affect your trip rather than a refund for a specific property.

2) A flight delay or cancellation means an extra night or loss of a booked night

Check the travel delay and trip disruption sections separately. One might provide a fixed cash payout after a qualifying delay; another might reimburse eligible additional accommodation or unused bookings.

The airline’s reason for the disruption and the minimum delay period matter. Keep its written confirmation, and check before assuming your extra hotel bill is covered, in case you happily go book some premium hotel. The airline may also provide a free night at a nearby hotel if they cancel the flight.

3) A natural disaster or unrest disrupts your stay

Some policies cover cancellation or itinerary changes caused by specified natural disasters, riots or civil commotion. DirectAsia, for example, lists these among its covered events.

That doesn’t mean any worrying news report qualifies. The event must meet the policy conditions, and exclusions for known events or war to apply. 

Some insurance policies do not cover for war or natural disasters, so check carefully. 

4) Your belongings are stolen from your accommodation

This generally falls under baggage or personal belongings cover. Report the theft promptly to the police and accommodation provider, and keep proof of ownership.

Expect item limits and restrictions on unattended belongings or valuables. For instance, leaving your laptop out while you head off for the day could affect your claim.

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ALSO READ: Best Insurance Plans for Lost, Delayed or Damaged Luggage

4. What travel insurance usually won’t cover

There are some things that travel insurance usually doesn’t cover.

For instance, you changed your mind or found a better deal. Standard cancellation cover generally requires a listed reason. Optional “cancel for any reason” benefits can be an exception, but may reimburse only part of your loss and have purchase deadlines.

If the listing isn’t as described. Perhaps the room looked larger in the picture or you don’t like the place. Unfortunately this isn’t considered claimable under insurance either. However, a materially misleading or uninhabitable listing may qualify for Airbnb’s own protection. Report the issue within 72 hours of discovering it, with photos and messages.

If there are fake listings or off-platform payment scams, don’t assume standard cancellation cover includes booking fraud. 

For costs that the host or platform has already refunded, you cannot claim reimbursement twice for the same expense.

If there is a known event that affects your trip and accommodation before buying cover such as travel advisory against going to a particular country. Buying a policy after the disruption becomes apparent generally won’t protect that loss. This also applies to pre-existing medical conditions. If you have a chronic condition that somehow flares up during your trip and you end up having to shorten or cancel the rest of the trip, you generally won’t be covered  unless you buy a policy that specifically covers pre-existing conditions.

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5. How to protect your accommodation booking

Whether you’re researching travel insurance, hotel cancellation cover or protection for an Airbnb stay, you have to check whether eligible non-refundable accommodation expenses may be covered when a specified event disrupts your trip. 

However, different providers have varying definitions, especially for private homestays like Airbnb. Refund terms also differ by property and platform.

To protect yourself, before paying:

• Choose refundable or flexible rates where practical. Compare the extra cost with what you’d lose if plans change.
• Pay through the platform. Keep payments and conversations within Airbnb.
• Buy insurance soon after booking. Cancellation protection generally starts after purchase, subject to the plan’s conditions. Some policies require purchase several days before departure.
• Save all the paperwork. Keep confirmations, listing screenshots, host messages, refund decisions and replacement accommodation receipts.

If your host cancels, contact Airbnb first. Then check whether any remaining loss meets your insurance policy’s conditions before turning a last-minute rebooking into an expensive assumption.

Travelling soon and have yet to buy insurance? Compare the best travel insurance plans on MoneySmart.

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