I would worry about this too. If you end up having to cancel your trip and it’s for medical reasons and related to a pre-existing condition, the insurance claim is going to require proof that the policy was in place within a certain number of days (typically 14 or 21) of your first payment of any kind for the trip. Or, if you buy insurance that includes cancel for any reason coverage and you simply change your mind about going, that too is a cancellation that is going to require proof that your policy was in place within x number of days of your first payment. Some policies allow you discretion as to how much insurance to buy, i.e., you can decide to self-insure some of your prepaid and non-refundable costs, whereas other policies require you to insure each and every pre-paid and non-refundable cost. For the latter, failure to insure one of your costs (e.g., your deposit) will void the coverage.
The insurance agent that I have used for all of my trip insurance policies for many years has strongly cautioned me not to make payments with prior credits when I’ve got a policy requiring coverage for all costs and when I want to make sure that my coverage for pre-existing conditions or cancel-for-any-reason is cemented in place. If you have to file a claim and the date of first-payment-of-any-kind is crucial for your particular claim, the insurer is going to want to see a canceled check or credit card statement showing when that payment was made. If that was a couple years ago, and all you can show is that it gave you a credit that constituted your deposit when you booked your new trip a year later, the company can deny the claim. My agent has told me that the work-around is to talk to the hotel, tour operator, etc. that is holding the credit and see if they’ll agree that if I pay a new deposit in full, they’ll refund the amount of the old credit after they see the new deposit. It seems like a game you shouldn’t have to play, but insurance companies are strict and literal. They want so see when the money was paid, and now you can give them a canceled check or credit card statement that is date-acceptable.
I’ve filed six or seven trip insurance claims over the years, some large (cancelled trip) and others modest (e.g., trip delay or trip interruption costs, increased per-person costs imposed on remaining members of a travel group when one member had to drop out for a covered reason, etc.) Each one has been successful, resulting in full payment of everything I was seeking. An intense amount of time goes into preparing these claims and the packet is thick. I have indeed had to attach proofs of payment for everything that I’ve sought to have reimbursed.
