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If I have trip interruption insurance and miss a connecting flight, causing me to need a hotel, the insurance will pay $350 for hotel, food and taxi.

However, the airline may also offer a hotel voucher.

There are advantages to using the insurance, such as more choice of hotel, and less hassle (perhaps). However I wonder, will my claim be successful since technically I could use the airline voucher?

It is moot now, but yesterday I had this situation - I decided to chase up the airline hotel voucher, just in case but it meant walking across the airport to find a rep., and then going to a hotel off of the airport instead of the one I would have preferred at the airport.

Similarly, what happens if a trip is cancelled and the airline offers credit instead of money - will the insurance say that the credit is as good as the money, so they don't need to pay?

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    Personally I found this type of insurance not appealing. The cheaper ones have too many exclusions and the more expensive ones are unreasonably expensive. In any case, you MUST read the fine print. More often that not it will say that your specific case is not covered.
    – Hilmar
    Sep 2 at 11:04
  • The voucher is a guarantee (more or less) that the airline will cover the cost of the hotel stay, while paying yourself and filing a travel insurance claim later means you have to do more paperwork and run the risk of your claim being denied (whether because you were offered a voucher or because some other exclusion in the policy applied). Money now pretty much always beats the chance of getting money out of an insurance company later, unless maybe the hotel is truly terrible or process of getting the voucher is that bad.
    – Zach Lipton
    Sep 3 at 1:36

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The details are probably specific to your insurance policy, so you’ll have to read the fine print.

It is probably very dependent on how expensive your travel insurance is. Cheaper ones will tell you you should have used the voucher.

Premium policies will be designed to give you a higher quality experience beyond what the airline is willing to pay for (which in turn often depends on your fare and status).

When there is cash involved rather than a voucher, the insurance may deduct that from what they pay you, but again, this will depend on the terms of your specific policy.

Of course since one often has to make quick decisions, the only way to take the right decision in that case is to have read and memorised the details of the policy in advance. Most people don’t do that, and insurers probably often bet on that.

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    One philosophically "negative" thing about this interruption insurance is that the hotel is paid by the insurance company, and not by the airline (although I suspect that airline carries it's own insurance for this purpose), as such the airline feels no financial pain and has less incentive to improve any systemic issues.
    – Peter M
    Sep 2 at 13:53
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    Insurance can remove moral hazard, but insurance companies are often keen on suing third parties to reimburse any costs. They're also likely to do a better job of litigation than a private individual, who may not know what they need to do. I don't know how likely it is for them to sue in this type of case.
    – Stuart F
    Sep 5 at 15:13

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