Policies can include medical expenses, lost passports, money wires and rebooking cancelled flights, but it’s important not to assume you’re covered for everything.
Clare Fisher has only had to use travel insurance once in all the years she’s been jet-setting around the world with her family, but she says she would never go without it.
“I have heard far too many stories from family and friends where people have been left to fork out fortunes because they didn’t have travel insurance after something happened during their travels,” says the mum-of-three and full-time travelling content creator behind the Instagram account @traveltheworldfamily.
“The thing is, you think it will never happen to you and sometimes it just does.
“As well as giving you peace of mind, if you do end up needing to claim, it could save you a lot of money.”
Travel insurance covers expenses and risks associated with being a tourist, whether for business or leisure, and packages can cater for both domestic and international travellers. This can include medical expenses, but also assistance with lost passports, money wires and rebooking cancelled flights.
Natural disasters such as earthquakes, hurricanes and wildfires are also often covered, and packages can usually be customised to the needs of the customer and their destination.
Growing markets
It is a big market. In the US alone, the industry is projected to reach a value of $5.5 billion by 2028 from $4bn in 2022, according to a report on researchandmarkets.com.
Within the study, this is attributed to increasing disposable income and a rise in business tours and travel. This year, international tourism will increase by 15 per cent year-on-year, according to data shared by United Nations World Tourism Organisation last month. It is also projected to exceed 2019 levels by 2 per cent.
Another reason for the market’s growth is that insurance providers have become savvier in terms of their offerings, expanding the availability of products, including single and multi-trip, as well as annual, policies, plus add-ons such as adventure tourism and more. The convenience of buying through online channels helps, too.
There has also been a growing awareness of the importance of having a policy in place. Nearly half of Americans have faced fines or had to bear the cost of damages when travelling without insurance at some point, according to a 2021 survey by insurance provider Battleface. The Covid-19 pandemic also presented many issues for anyone who was away from home when they got sick or when lockdowns were announced.
The same research found 36 per cent of Americans were more inclined to buy insurance now than pre-pandemic, particularly for international travel.
At the same time, the pandemic made customers more sceptical of the benefits, as many providers were ill-prepared to offer coverage for trip cancellations due to death.
The recent research also shows individuals in underdeveloped and developing nations are more reluctant than ever to pay for insurance services.