Record travel costs fail to curb summer bookings as travellers seek protection

Record-high travel costs have failed to dampen demand this summer, with insured trips rising despite a sharp increase in the price of holidays, according to new data from Squaremouth.

The travel insurance comparison site surveyed more than 7,600 customers in July and found average summer trip costs reached US$9,032 – up 17.4% year on year. That increase falls within the price range travellers previously identified as likely to make them reconsider their plans.

Nearly four in 10 respondents (39.1%) said a 10–25% price increase would prompt them to reconsider travelling, while 7.5% said an increase of less than 10% would be enough.

However, insured summer trips were up 18.3% year on year at the time of the survey.

Rather than cancelling, travellers were more likely to adapt their plans or increase protection. Some 10.2% travelled closer to home, 9.7% bought more travel insurance coverage than usual, and 7.7% opted for a cheaper destination. A further 6.2% postponed their trip.

Only 3% cancelled entirely, while 55.4% made no changes to their plans.

“Travel isn’t the first thing people cut from their budgets anymore,” said Chrissy Valdez, Senior Director of Operations at Squaremouth. “While we know that travellers are sensitive to price increases, the record trip costs we’ve seen still aren’t enough to force them to cancel. Rather, they’re finding ways to alter and better protect their trips.”

The findings point to continued demand even as consumers face higher trip costs – with insurance increasingly part of how travellers manage financial risk rather than a discretionary purchase.