Travel Insurance - UK - February 2016
“Travel insurance is at risk of becoming synonymous with low cost, low cover policies that fail to meet the needs of customers. Repositioning the product as transparent and helping to educate people would help insurers to stand out from the rest of the market. Opportunities ranging from point-of-departure sales to claims-led mobile apps remain relatively untapped, presenting the chance to steal a march on the competition.”
– Patrick Ross, Financial Services Analyst
This report discusses the following key topics:
- Mobile apps with claims functionality could help build brand
- Too many cheap policies come at the price of customer protection
- Point-of-departure sales could serve the forgetful and the fearless
In 2015, travel insurance premiums are expected to have grown for the second consecutive year, relieving some of the pressure that had built on the industry following three years of decline. Single-trip policies grew at the expense of annual policies as the pursuit of lower price continues among holidaymakers.
Travel insurers can no longer rely purely on growth in the number of trips and travellers, as travel insurance penetration is being limited by lower engagement among younger generations. The people that do arrange insurance are sometimes so motivated by price that they are blind to the lack of cover associated with their low cost policy. Educating and informing the public about the importance of quality travel insurance cover is a difficult task, but it remains key to stopping low value, low cover policies from becoming the norm.
Nonetheless, there are relatively untapped opportunities available to insurers willing to invest in the travel market. Mobile apps are few in number and have the potential to build better relationships with customers. Claims-led apps are the safest bet, supported by content that users can access while they are abroad. Mobile has further potential as a sales channel, particularly at the point of departure where the forgetful are likely to be thankful for a quick and simple arrangement option.
This report covers both single-trip and annual policies, reviewing the market as a whole and how insurers are going about increasing their share of the market. Mintel’s consumer research examines how people arranged travel insurance for their last holiday, before assessing attitudes towards travel insurance and the role of mobile technology.
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