As the war in Iran grounds flights worldwide, hundreds of thousands of travelers scrambling to get home are discovering a harsh reality: their travel insurance won\u2019t cover replacement flights or extended hotel stays.<\/p>\n
Insurers, including industry giants Allianz SE and Zurich Insurance Group, don\u2019t cover claims tied to the conflict under standard travel policies, according to advisories. Fighting has shuttered Gulf airports, including the main one in Dubai, severing a critical transit corridor for long-haul travel. At least 23,000 flights to Middle East hubs have been canceled, leaving passengers to rely on airlines for rebooking or pay thousands of dollars out of pocket.<\/p>\n
The crisis is exposing a gap in the estimated<\/a> $31 billion annual travel insurance market: Nearly all policies exclude<\/a> war-related<\/a> claims. Consumer advocates have long warned the product offers limited value, citing high commissions, low payouts and sweeping conflict exclusions.<\/p>\n \u201cWhen it comes to war, that is pretty much a blanket exclusion across all travel insurance policies,\u201d said Jodi Bird, a travel specialist with Australian consumer advocacy group Choice. \u201cWe aren\u2019t aware of any travel insurance policies that will cover claims that are directly related to war. And it\u2019s quite broad, unfortunately.\u201d<\/p>\n Travel insurance typically covers new tickets, hotels and meals if flights are delayed or canceled, as well as reimbursement of pre-paid expenses if a trip is scrapped. But the Insurance Council of Australia said standard policies exclude losses directly caused by war or conflict.<\/p>\n \u201cThese exclusions exist because the scale and unpredictability of armed conflict create risks that are difficult for insurers to price,\u201d the council said in an advisory<\/a>. \u201cWithout this exclusion, premiums for all travellers would be unsustainable given the risks the coverage would need to account for.\u201d<\/p>\n Fine Print<\/p>\n Providers including Allianz and Zurich\u2019s Australian brand Cover-More said they will extend travel coverage at no extra cost for customers stranded abroad who started their journeys before the conflict began. But the claims allowed, such as medical expenses or lost baggage, remain unrelated to the conflict.<\/p>\n Some insurers offer premium \u201ccancel for any reason\u201d policies that may reimburse a portion of prepaid expenses. Still, even those plans come with caveats, including caps on total trip costs.<\/p>\n As expenses mount, stranded travelers are venting on social media and seeking advice. Reddit users reported sky-high fares after Middle Eastern carriers suspended operations. Others say they were blindsided to learn their policies \u2014 annual, single-trip or credit-card-backed \u2014 exclude armed conflict.<\/p>\n One Reddit poster said their Melbourne-to-Europe flight via Doha was forced to return when the conflict began. They had to buy more expensive tickets on another airline taking an alternate route, costs not covered by insurance. Another wrote about friends stranded in Europe trying to return to Asia whose insurer deemed the disruption a \u201cdomino effect\u201d of military action \u2014 language, they wrote, that was buried in the policy\u2019s fine print.<\/p>\n The disruption comes as global aviation and tourism claw back to pre-pandemic passenger levels. The Gulf is a vital crossroads for long-haul traffic, and prolonged instability threatens airline revenues and bookings. It follows high-profile strandings in Mexico after cartel violence erupted \u2014 twin shocks that could reshape how travelers assess risk when planning international trips.<\/p>\n