US insurer Seven Corners has published a list of four trends in the spending habits of travellers in 2021, drawn from data accumulated by the company over the past 12 months.
Older insurance customers are more likely to purchase from agents
Seven Corners found that buying patterns for travel insurance can vary significantly according to the customer’s age.
Clients who purchased travel insurance from a licenced agent tended to be on average eight years older than those who purchased via a website, at approximately 50 years old for agent users compared with 42 for website users. The preference of older clients to seek assistance in their travel insurance purchases is highest for the 66+ demographic, who represented almost 20 per cent of all plans sold by insurance agents.
Older consumers also tend to spend more on travel, with average cost per trip for the over-66 demographic being an average of US$3,243, compared with just $1,843 for millennials (aged between approximately 25 and 40 in 2021).
2021 saw a substantial rise in short trips of five days or less
The popularity of ‘micro-cations,’ defined as a trip of less than five nights, grew in popularity in 2021, according to Seven Corners’ records of policy sales.
The popularity of these short trips has reportedly risen by 74 per cent compared with 2019, and 66 per cent compared with 2020. This style of travel is particularly in vogue with millennials, with 30 per cent of all insured trips by this demographic falling within the category.
Generation X (aged approximately between 41 – 56 in 2021) and generation Z (aged between nine and 24 in 2021) were the second biggest demographics, with approximately 20 and 19 per cent of all trips insured being micro-cations, respectively. Baby boomers (aged 57-75 in 2021) had substantially smaller interest in insuring short trips, with only 12 per cent of insured travel being micro-cations.
Alternative destinations are gaining popularity due to perceived Covid threats
Destinations for micro-cations insured by Seven Corners in 2021 have changed due to the influence of the coronavirus pandemic and related travel restrictions.
Turks and Caicos being the top destination for all demographics except the 66+ demographic, who preferred Mexico, despite the island nation not being in the top 30 most popular destinations pre-pandemic. Millennials in particular favoured the destination, choosing it for 61 per cent of international micro-cations.
Mexico, which was the top destination in 2019, fell to second place in 2021, while Costa Rica, another island, leapt to third place in 2021, from just 15th place in 2019.
Destinations which fell from the top 10 spots in 2021 included Canada, Puerto Rico, Ireland and the United Kingdom, most likely due to the restrictions resulting from Covid-19.
For Any Reason travel insurance is more popular with younger travellers
‘For Any Reason’ travel insurance policies continued to be popular in 2021, due to continued concerns about disruption caused by the coronavirus pandemic.
Seven Corners says that adoption rate for its Interruption For Any Reason benefit – which provides coverage for trips which must be ended early - is relatively strong, with 17 per cent of direct consumers choosing to add it to their purchase.
There is again a clear generational divide, with the benefit has experienced higher adoption among the millennial and generation X demographics, which have adoption rates of 26 and 28 per cent respectively. Baby boomers, by contrast, have an adoption rate of only 12 per cent.