Will travel insurance cover trip delays or cancellations due to fuel shortages?

Your 2026 travel plans may be disrupted by the ongoing jet fuel shortages. Global supply chain issues and rising fuel prices – as a result of the war in Iran and closure of the Strait of Hormuz – are expected to cause serious travel delays and cancellations.

The question on every Canadian's mind is, “Will travel insurance cover my trip?” 

The temptation to book a trip now and deal with the potential fallout later is real. But, it’s always worthwhile to understand what you’re covered (and not covered) for, if you do experience issues. 

Keep reading to learn how the ongoing conflict has impacted the travel industry, including whether a travel insurance policy will cover fuel shortage-related cancellations and what you can do to protect your trip.

What is the jet fuel shortage?

The ongoing US-Israel conflict with Iran is limiting the global supply of oil, as the Strait of Hormuz remains closed. The limited oil supply has effectively spiked prices, as it is increasingly difficult for countries to get hold of. As a result, gas prices at the pump have jumped significantly, and so has the cost of aviation fuel. 

For this reason, the availability of flights and prices for the spring and summer is uncertain, as airlines have already started increasing costs for travellers.

What is the impact of fuel shortages on travel costs?

To offset rising fuel prices, airlines have started implementing fuel surcharges, increasing checked-bag fees and limiting and suspending flight routes.

Fuel surcharges

Canadian travellers are likely to see additional taxes and fees added to their flight costs amid the jet fuel shortage. Airlines like Air Canada, Porter, WestJet and AirTransit have already tacked on surcharges. Although in many cases, whether you’ll be charged depends on the destination and how you booked the trip.

For example, Air Canada Vacations implemented a $50 per passenger surcharge for ‘Sun destinations’ as of April 6, 2026. Air Canada is also surcharging international flights originating from Japan. 

WestJet, on the other hand, is charging a $60 fee for bookings made with a companion voucher, and Porter is charging a $40 fee for bookings made through VIPorter, its member-based frequent-flyer program.

Increased baggage fees

To cover the cost of carrying extra weight, airlines have also upped the checked-bag fees. For example, Air Canada increased the cost of checking luggage by $10 for basic economy class tickets to the U.S. and sun destinations, bringing the total to $45. 

WestJet also increased the price by $5 for first and second prepaid checked bags, and by $10 for bags checked in at the airport. 

Limiting and suspending flights

Beyond adding costs to travellers, airlines are also conserving fuel by reducing flights and suspending flight routes altogether. Air Canada announced the temporary suspension of six flight routes, including flights into JFK Airport from Toronto and Montreal, which will run all summer from June 1st to October 25th. 

Does travel insurance cover flight disruptions due to fuel shortages?

Whether travel insurance covers flight delays and cancellations due to a fuel shortage depends on the insurance company and potentially when you purchased coverage. Manulife issued a travel advisory announcing that, effective May 5th, the fuel shortage is now considered a ‘known event’. 

This means travellers who knowingly purchase a flight after May 5th will no longer be covered by Manulife’s standard travel insurance policy for disruptions caused by fuel-related issues. Instead, the responsibility falls to the airline to rebook or refund the trip.

Other insurers, including Allianz Global Assistance and TuGo have also announced that the jet fuel shortage is considered a ‘known event’ (effective as of mid to late April). It’s expected that other insurers will follow, further limiting travel insurance coverage due to fuel shortages.

Am I covered against the fuel shortage if I already bought travel insurance?

Yes, if you purchased travel insurance before your insurer listed the fuel shortage as a known event, you should still be covered. However, each insurance company has their own rules. It’s best to refer to your insurer’s travel advisory to confirm your policy’s exact cut-off date.

For example, under Manulife, if you purchased a policy before May 5th and your flight is cancelled or interrupted, you may be covered by misconnection or disruption benefits. The same applies to travel disruptions caused by fuel shortages on your return trip home. But, if you buy a policy after May 5th, disruptions caused by fuel shortages will be excluded. 

It’s important to remember that travel insurance coverage only applies to events listed in the policy. In other words, not every unexpected situation is protected, even though most Canadian travellers assume it is. For example, 64% of Canadians expect basic travel insurance to cover trip cancellation for any reason. 

The reality, however, is that oftentimes a standard travel insurance plan does not provide sufficient coverage. For this reason, it’s essential that travellers read their policies carefully to understand policy exclusions.

How can I protect my trip from travel disruptions due to fuel shortages?

You can protect your travel plans from disruptions due to fuel shortages with a comprehensive travel policy. Many comprehensive policies offer a ‘cancel for any reason’ (CFAR) endorsement, which is an add-on you can purchase. This ensures you’ll receive some form of reimbursement if your plans change due to a non-covered reason. 

Typically, to get coverage, you need to buy the endorsement within 5 to 7 days of booking your trip. Most policies will cover between 50% and 75% of your expenses and require you to cancel the trip within a specific time frame before your departure date. Coverage terms will vary by insurance company, so it’s best to review the policy to be sure. 

What happens if the airline shuts down due to fuel costs?

In extreme cases, airlines may be forced to shut down operations due to financial pressures, such as what happened with Spirit Airlines. The high cost of jet fuel led the Airline to cancel all flights and shut down its customer service, leaving many passengers stranded. 

You can protect against this risk by opting for ‘supplier default protection’, a type of trip interruption coverage. This insurance can reimburse you for your prepaid and non-refundable costs, including planned activities and hotel accommodation. Coverage rules and limits will vary by insurer. 

The bottom line 

The ongoing global jet fuel shortages could impact your upcoming travel plans. To offset soaring fuel costs, airlines are already adding surcharges to specific destinations and limiting or even suspending flight routes. 

As of early May 2026, Manulife announced that fuel shortages will be listed as a ‘known event’, meaning travellers will not be covered for a related trip disruption under a standard policy.  It’s expected that other insurers will follow soon.

To protect your trip, you can purchase a comprehensive travel insurance policy with ‘cancel for any reason’ coverage. This will provide some reimbursement if your plans are cancelled or delayed due to the fuel shortage. For an extra layer of protection, ensure all of your bookings are refundable. 

Have an upcoming trip planned? Compare travel insurance quotes today at Ratehub.ca.

Also read:

• A complete guide to travel insurance for the 2026 FIFA World Cup
• Do you need travel insurance within Canada?
• Stop overpaying for travel insurance: 5 tips to cut costs