Vacation Cancellation: Will Insurance Give Shelter? : Refunds: Buying a policy doesn’t always mean getting all your money back for tickets and hotels. Read the fine print.

If you’ve booked a cruise or a package tour in the last few years, or if your travel agent is aggressive about maximizing revenues, you’ve heard the pitch for trip cancellation and interruption insurance.

The idea is attractive: Once you pay an insurance premium, you’re protected if unforeseen circumstances force you to cancel a trip in advance or in progress.

But the realities of this kind of insurance (those in the trade call it TCI) are complicated, involving voluminous fine print, various excepted circumstances and relatively easy money for those who sell the policies. Travel agents routinely make 35% commissions on sales of insurance policies, a powerful sales incentive, especially in the aftermath of the move by major U.S. airlines in February to cut back on domestic commission payments.

The size of travel insurance commissions also suggests that the policies are big moneymakers for insurance companies, which is bound to make a traveler wonder if the policies are really worthwhile.

The answer is yes, they probably are worthwhile, if you’re buying a cruise or a tour package, because those typically require hefty prepayments and penalize you heavily for late cancellations.

But the answer is probably no if you’re traveling independently without major prepayments, you’re healthy and you’re unaware of any potential crises brewing at home or your destination.

(However, travelers to unusually hazardous or remote areas should consider medical evacuation coverage.)

Trip cancellation and interruption insurance typically costs about $5.50 per $100 of coverage (thus, $110 to cover a $2,000 trip to Europe). But insurers also “bundle” several related types of coverages together (cancellation-and-interruption, emergency medical evacuation and death-and-dismemberment coverage are among them) for leisure travelers. Premiums for a two-week, two-person, $2,000 trip tend to run about $150-$200.

Several companies also offer insurance packages specifically aimed at cruise passengers, and cruise companies and tour operators often sell insurance themselves. (That coverage is commonly underwritten through insurers such as those below.)

Cancellation and interruption policies are generally designed to pay off if a trip is canceled or cut short because of death or injury to yourself, a traveling companion or an immediate family member; if an operator providing travel fails; if weather or certain crises at home impede your travel, or if certain crises at your destination affect your trip. But provisions vary, and all include many exclusions and caveats.

For instance, insurers handle pre-existing medical conditions differently. The typical definition of a pre-existing condition is any ailment for which a person was treated by a doctor or took prescribed medication during a specific period of time before purchase of the insurance policy. But the specified period could be 30 or 180 days, depending on the insurer. Also, in operator-failure coverage, protection may be limited to an operator’s “bankruptcy”--though many tour companies and travel agencies have failed (and stranded their customers) without ever declaring bankruptcy. You may or may not be covered in the event of sudden political instability or violence at your destination.

Here’s a sampling of prices, based on two people traveling 12 days in Europe this summer.

Access America (tel. 800-284-8300): Straight cancellation and interruption coverage runs $5.50 per $100 of trip cost. For $181, a comprehensive travel policy includes $2,000 in cancellation insurance, $50,000 in emergency transport and $20,000 in emergency medical coverage. Cruise packages also available. A representative notes that Access America also administrates the American Express Vacation Protection Plan (800-756-2639/not restricted to cardholders), which offers a comparable comprehensive package for $152; and the American Automobile Assn. TripAssist plan (800-284-8300/membership not required, but application number must be obtained through an AAA travel agent), which offers a comparable package for $163.

Mutual of Omaha’s Tele-Trip division (800-228-9792): Straight cancellation and interruption coverage runs $6.50 per $100 of trip cost. For $194, a comprehensive “Travel Assure” policy includes $2,000 cancellation coverage, $25,000 in emergency transport and $10,000 emergency medical coverage.

Travel Guard (800-826-1300): Straight cancellation and interruption coverage (which must be purchased at least 12 days before departure) runs $6 per $100 of trip cost. For $69 per person, a comprehensive Cruise and Tour policy includes $1,000 in cancellation and interruption coverage, $20,000 in emergency transport and $10,000 in emergency medical coverage.

Travelers (800-243-3174): For $55 per person, the company offers $1,000 in cancellation and interruption coverage and $10,000 in emergency medical evacuation coverage. Cancellation and interruption insurance can be pushed to higher amounts for $5.50 per $100 of trip cost.

Reynolds travels anonymously at the newspaper’s expense, accepting no special discounts or subsidized trips. To reach him, write Travel Insider, Los Angeles Times, Times Mirror Square, Los Angeles 90053. * TRAVELER’S JOURNAL: Canceling the best-laid plans: one woman’s story. L16