aquabluegreg
Contributor
They rely upon the customer to provide correct information. They assume you will insure what would be your actual loss. If a customer insures a flight that they know is a fully refundable ticket and try to collect a canceled flight from the airline and the insurance company, that would be fraud. Probably not a good idea. Why would a customer insure a full refundable air ticket..? They probably would not. In your case it would be your actual loss, whatever you determine that to be. Remember if you claim a $1000 resort loss, you might need to provide an actual paid booking for $1000.