US Government Shutdown: Impacts on Business Travel

Essential services such as the Transportation Security Administration (TSA) and air traffic control remain operational during a shutdown. However, staff in these roles are not paid until normal funding resumes. 

In past shutdowns, this has led to widespread absenteeism as unpaid staff call in sick or seek other work. The result is often longer security queues, delayed flights, and occasional cancellations, especially at major US airports such as New York (JFK), Los Angeles (LAX), and Atlanta (ATL). 

Travellers should allow additional time for airport processing and prepare for potential delays. It’s also worth noting that such disruptions are not automatically covered unless they directly cause a missed connection or trip cancellation under your policy. 

Choosing Not to Travel 
Deciding to cancel or postpone a trip because of staffing or delay concerns is not automatically covered. Forfeit benefits generally apply only once travel has commenced and require a recognised trigger such as illness, injury, or another unforeseen event. 

Airline Cancellations 
If your airline cancels a flight, most insurers will reimburse that flight cost but expect you to make reasonable attempts to rebook. If only part of your journey is affected, policies usually cover the additional costs (like new flights or accommodation), not the full trip. 

Leisure Extensions 
Personal or leisure travel is not automatically included under a corporate policy. You’ll need to nominate this before you go, and sublimits often apply. Always confirm with your broker before travelling to ensure you’re properly covered. 

Missed Connections 
Benefits apply to missed public transport (such as flights, trains, or ferries) due to an insured event, but generally don’t extend to private or chartered services. 

Government Travel Advisories 
If DFAT or another authority issues a “Do Not Travel” warning and travel continues, cover will not apply. If the travel is essential, contact your broker immediately to discuss options with your insurer. 

Feeling uneasy about disruptions is understandable but unease alone does not trigger cover. 

Before departure: 

• Confirm your travel cover before booking or extending your trip. 
• Keep documentation for any cancellations, delays, or rebooking costs. 
• Check DFAT advisories before you go. 
• Allow extra time at airports in case of reduced TSA or air traffic staffing. 

Travel disruptions can escalate quickly, and every policy responds differently. 

For tailored guidance, speak with your insurance representative or reach out to the team at Knightcorp to review your current cover and risk exposure. 

_{DISCLAIMER: This information is provided to assist you in understanding the risks, implications, and common considerations for your industry.  It does not constitute advice and is not complete. Please contact Knightcorp Insurance Brokers for further information.} 

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