Traversing the landscape

ITIJ 214, November 2018
Travel insurance is a key piece of the conversation that takes place between a travel agent and a client when booking travel
Jayson Westbury
Chief Executive
Australian Federation of Travel Agents

ITIJ spoke to Jayson Westbury, Chief Executive of the Australian Federation of Travel Agents (AFTA), about the landscape of travel insurance and travel agents in Australia, travel trends, and the importance of consumer awareness

What is your background in the travel industry?
I have been in the hotel, hospitality, tourism and travel industry my entire working life of 35 years. I have held operational positions in both large and small companies and have worked for the past 23 years in some form within the government relations environment of the industry via industry associations and representative forums. 
Where does travel insurance promotion fit into the overall agenda for AFTA?
AFTA is a strong supporter of the Department of Foreign Affairs and their Smartraveller initiative. In fact, AFTA works closely with the Department of Foreign Affairs and Trade (DFAT) to educate Australians about safer, smarter travelling.  
Travel insurance is an essential part of travel, as it is all about protecting the traveller against the unexpected. Additionally, AFTA is committed to supporting the Government’s important messaging to Australians that ‘if you can’t afford travel insurance, then you can’t afford to travel’. 
There are many convincing reasons to buy travel insurance. Your flight has been cancelled or delayed, your passport or wallet has been stolen, you need to cancel your trip due to illness, you have a medical emergency in a foreign country, the airline loses your bag, there’s a family emergency back home, there’s a hijacking or terrorist attack. Or even just peace of mind!
Travel insurance is a key piece of the conversation that takes place between a travel agent and a client when booking travel and there is a commitment to support travel insurers who support the travel agency community. 
How significant is sale of travel insurance to your members, not just in terms of revenue, but also in terms of their Duty of Care liabilities?
Insurance forms a part of the revenue mix for travel agents. It is not a key source, but a supplementary source. The ongoing challenge that travel agents face is online resellers of insurance products that are stripped down in order to look very cheap, but in fact do not serve the consumer or the industry well in the end, as in many cases the consumer ends up under insured or not informed correctly as to what exclusions, travel zones or other important aspects may apply to their trip. There is a duty of care by the travel agent and as such they remain best placed to ensure the correct insurance options are presented for the consumer to choose. 
Does AFTA support its members with regards to education and training around selling appropriate travel insurance to their customers? 
Due to the regulatory framework in which travel agents sell travel insurance, the process of education and training remains the responsibility of the insurance companies directly. AFTA supports as needed, but in most cases insurance companies do a good job at this with agents. 
What are some of the key issues that travel agents come up against when it comes to selling appropriate travel cover to customers?
Price is unfortunately the number one issue. This has not been something that the agents have created, it has been the online portals that have grown with the support of the insurance companies, we believe looking for volume over quality. 
Has the changing regulatory landscape in Australia affected the sale of travel insurance by travel agents over the years? What are the current legal requirements on travel agents when it comes to recommending travel insurance to customers?
The regulatory landscape for selling travel insurance has been very stable and it is well understood by the industry and insurance companies. Travel insurance is a financial product and such travel agents are not licensed to give advice in this regard. What they do is ensure that choice is provided to the consumer and that they identify the key factors that they should consider when deciding which insurance the consumer wishes to purchase. 
Would you like to see closer co-operation with Australian insurance associations – or other bodies – to ensure travel insurance sales are better supported in the travel industry?
Absolutely. There are currently several legal cases afoot in Australia in which insurance companies are placing the relationship at risk. It is bloody-minded and short-sighted. We remain concerned about these behaviours by some insurance companies. 
You recently gave a presentation at the International Travel & Health Insurance Conference (ITIC APAC) in Sydney about Australian travel trends. What key travel trends have you seen over the last few years related to Australian travellers?
First and foremost, an immense increase in the number of Australians travelling overseas. Australia is the eighth largest by number (not per capita) outbound market in the world and for a small country on a global measure we punch well above our weight. Fifty-six per cent of Australians hold a valid passport, this is the second highest penetration rate in the world. The Australian economy, living standards, annual leave entitlements, wealth in retirement and political settings provide for a robust travel industry and we hope that this will remain for many years to come. 
How does AFTA work with other industry bodies or governments (such as on the Smartraveller initiative) to promote safe travel practices?
AFTA has a strong working relationship with DFAT, in particular Smartraveller, in providing weekly notices of changes to the travel alert levels to our travel agent members to assist in communicating directly with their customers prior to travel. AFTA often communicates to our network strategic messaging from Smartraveller in regards to special alerts, passports, travel safety and consular services to help educate Aussie travellers before they depart overseas. 
Going forward, what are your plans for AFTA in 2019?
AFTA administers ATAS – AFTA's Travel Accreditation Scheme, a national scheme which endorses businesses based on meeting strict criteria and industry standards. AFTA recently conducted consumer research which demonstrates the growing importance of industry accreditation, for the consumer, due to the endorsement, trust and peace of mind that the Scheme offers consumers purchasing travel. 
The research revealed that 82 per cent of travellers will actively look for an accredited travel agent when booking travel, and 54 per cent of consumers want ATAS to be more strongly promoted to help them make informed purchase decisions.
In 2019, AFTA remains committed to elevating industry standards and ensuring that the 1,300 accredited travel agency locations around Australia continue to be compliant with Australian Consumer Law and the Scheme’s Code and Charter. Educating the consumer about industry accredited travel businesses is also of utmost importance. ■

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