Consumer attitudes to travel and travel insurance changed dramatically by Covid-19
Finaccord’s dedicated consumer study details a whole new landscape
The Covid-19 pandemic heavily impacted the travel and travel insurance markets. In terms of insurance, take-up rates and the types of policies purchased have changed, with consumers now more aware of the risks a pandemic can cause. Finaccord has released a consumer study across ten key markets – Australia, Brazil, Canada, China, France, Germany, Italy, Spain, the UK and US – revealing new travel insurance patterns across different geographies and demographic groups.
There has been huge disruption to underlying travel markets, with international travel the most impacted, especially among older travellers. Compared to Finaccord’s previous study in 2017, the number of old travellers (aged 55 plus) taking a trip abroad over a two-year period fell from 44 per cent to 22 per cent. This decrease was much larger than the 18- to 34-year-old bracket, which dropped from 46 per cent to 38 per cent over the same period. Domestic travel also suffered, but the decrease was not as extreme.
Effect on travel insurance
The types of policies travellers are buying has changed irrevocably. Domestic-only policies accounted for a quarter of those acquired in the 2022 survey; it was only nine per cent in 2017. In contrast, standard policies fell from 73 per cent to 44 per cent, while all non-standard policies – for backpackers, older travellers or people with pre-existing medical conditions – were slightly more popular among insured travellers.
The number of claims has increased – up to 14 per cent in 2022 compared to ten per cent in 2017 as an average between the ten countries. But Canada and the UK saw claims frequency double. However, claim acceptance rates remained consistent in most countries. Covid-19 was a factor in over half (56 per cent) of claims.
Except for France and the US, the majority of respondents in all the countries are willing to pay more for insurance in the future if it includes pandemic cover.
It’s not just in these markets where travel insurance is becoming more popular; in New Zealand, travel insurance sales are higher than pre-pandemic.
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