Mind the gap
Following a review of one of its products, which found that claims levels had risen significantly over the last two years, one UK insurer has called on the industry to be more flexible so that it can better meet the needs and claims experience of certain travelling groups. Mandy Aitchison has the details
Following a review of one of its products, which found that claims levels had risen significantly over the last two years, one UK insurer has called on the industry to be more flexible so that it can better meet the needs and claims experience of certain travelling groups. Mandy Aitchison has the details
Upon reviewing the details of its backpacker policy, designed specifi cally for gap year travellers (those who travel for a year between leaving school and starting university), Columbus Direct found that the average cost of a medical claim on the policy increased from £370 to £750 in the past two years. Furthermore, the company says that it has seen a rise in the same period in the number of claims from backpackers who are not covered by standard policies. “For example,” said the company’s head of retail Greg Lawson, “many younger travellers will rely on the off-the-shelf annual family policy, which may not provide adequate cover for the activities they engage in or the destinations they visit.” It is Lawson’s view that: “The industry has a responsibility to provide a product that reflects the risks that backpackers face when travelling, including cover for more unusual sports and activities, travel delays for internal connections, problems with visas and entry to remote destinations as well as help following imprisonment abroad.” He believes that the travel insurance industry in the UK needs to recognise and address the needs of gap year travellers through several means – offer policies with more choice and flexibility, and constantly update products to more accurately reflect current and evolving travel trends. “A greater amount of collaboration between the insurance industry and official bodies such as the UK’s Foreign and Commonwealth Office (FCO), could help identify which aspects of foreign travel need new or improved insurance solutions,” concluded Lawson.
In related news, the FCO has launched a new travel guide for those planning a trip abroad in an effort to educate consumers. Called Plan. Pack. Explore., the guide contains a wealth of information – from travel health advice to explaining exactly what the FCO can and can’t do for travellers in trouble abroad. Khalida Cox from the FCO’s Know Before You Go campaign said of the issue of gap year travellers: “Gap years should be all about having fun, exploring the world and hopefully enhancing your CV, but if you are not prepared before you go away, things can go horribly wrong. Statistics show that over the last six months, one in four of 16 to 24-year-olds travelled without insurance and only a quarter made health-related preparations before going overseas.”
There is also concern about the level of cover for personal possessions on offer within gap year policies, as travellers are taking more electronic items away with them than ever before, and each item has a higher value on it. New research from Post Office Travel Insurance has shown that smartphones are the number one item that gap year travellers will pack in their backpacks this year. More than half of those surveyed (52 per cent) said they would not be leaving home without their precious gadget, while laptops, hair straighteners and Kindles are also now considered to be essential travelling companions for the typical gapper. The top-five must-haves in the gap year travellers’ backpacks are, in order: a smartphone, a laptop/ iPad, a debit/credit card and money, an iPod and a digital camera. Despite the research showing that travellers are departing with such high-value items in their luggage, one in three 16 to 34-year-olds felt that travel insurance was not essential when travelling abroad. Post Office Travel Insurance has warned travellers that it is not just personal items they are putting at risk, reminding travellers that medical costs can quickly add up. The company’s own research for its Explorer policy in 2011 found that the most likely countries for medical expenses from gap year travellers are Thailand (no surprises there for regular ITIJ readers), China, Vietnam, South Africa and India.