We're going to CSA next July (2010). We'll be booking hotel only and using American Airline miles for the flight separately. The cancellation policy for hotel only is pretty liberal (cancel up to 46 days prior to arrival), so am I wrong in just booking with the current promotions and maybe just cancelling and rebooking later if a better deal comes along?
Nope, you are exactly right! You should book your hotel now because this is probably as cheap as it will get. Then if you buy the insurance, then you can cancel and re-book if a better deal comes along. We go in April every year, and so we have already booked the hotel. We won't buy our flights until at least October but maybe as late as January.