Saga claims to have become one of the first insurers in the UK to extend the terms of its travel policies to include some cover for cancellation due to Covid-19.
The policy update will apply to all new and renewing customers.
The cover means that anyone taking out a new policy will be able to claim up to £10,000 per person insured if they need to cancel a holiday because they receive a positive Covid-19 test in the 14 days before their trip departure date.
The changes are the latest addition to Saga’s comprehensive insurance.
The company was one of the first to include medical treatment abroad and repatriation costs for Covid-19 as standard in June.
In addition to the cancellation cover, policyholders will now also be able to claim on their insurance for the remaining value of their holiday if they contract Covid-19 while abroad and as a result they need to return early.
The changes have been introduced to provide customers with the confidence to travel in the coming weeks and months, the over-50s specialist said.
It is also in response to increasing customer demand – cancellation cover was named as the second most important thing companies could do to make people more comfortable about travelling abroad in a recent Saga survey.
The company pledged to review its policy terms to ensure customers receive “significant value” from the cover as travel advice continues to change.
Saga will also introduce further elements of cover based on customer feedback.
Saga Health and Travel Insurance head of product Kevin McMullan said: “With travel restrictions continually changing, many people may be worried that much-anticipated holiday plans could be cut short, or increasingly reluctant to go at all.
“Now more than ever people need to feel confident and reassured when planning to travel overseas.
“Our new policy terms mean all new customers will be covered with up to £10,000 of cancellation cover should they fall ill with coronavirus in the 14 days before they depart. While they’re abroad they’ll also be covered for any medical costs as a result of Covid-19.
“We’re continuing to review and update our products to ensure they reflect the needs of our customers.”