Travel insurance is going through a lot of changes due to Covid – are there any adjustments you welcome and hope will stick?
We have seen that travel insurers have had to adapt their coverage to the pandemic. It was not just a localized outbreak, but rather an unprecedented global lockdown. With that, travel insurance providers had to wade through uncharted territory to figure out what would and wouldn’t be covered.
Most have landed on Covid-19 coverage like any other illness, such as the flu, allowing for trip cancellation or curtailment if there is a diagnosis from a doctor and a recommendation not to travel . Additionally, some providers have added or further clarified their definition of a “covered” quarantine, as this is now a major concern for many people traveling during the pandemic.
We’ve also seen companies meet certain requirements, such as needing a specific coverage limit for quarantine accommodations in order to enter. Several companies have updated their “travel delay” compensation limit to meet the requirement of more than US$2,000. Although some countries are relaxing specific entry requirements, you will most likely need to remain in quarantine if you have a confirmed diagnosis of Covid-19 during your trip and this benefit could help reimburse any additional accommodation costs you may face .
Suppliers also worked with many customers to allow policies to transfer to new travel in the future when Covid-19 shut down much of the world. Some have offered transfers up to two years into the future.
What about some of the difficulties? How did you overcome the challenges related to the pandemic?
Since the start of the pandemic, more and more travelers have become aware of or have become interested in travel insurance. Many of these travelers have not purchased travel insurance in the past, so educating these new customers has become a priority for InsureMyTrip. Things are constantly changing with the pandemic. Countries are adding or relaxing Covid-19 entry requirements almost daily. This can be confusing for travelers. That’s where InsureMyTrip’s visa requirements and travel restrictions tool comes in. It updates automatically when a country changes its requirements and restrictions.
Travel insurance companies have also had to adapt to the pandemic. InsureMyTrip is providing more ways for travelers to find the coverage that can help reimburse money lost, due to covered issues related to the pandemic. Prior to the pandemic, cancellation for any reason (CFAR) and quarantine coverage were not widely known or considered. InsureMyTrip has taken the time to educate the public about these coverage options. CFAR offers the most flexibility for travelers to cancel a trip for fear of travelling. This benefit is time-limited and there are certain eligibility requirements, but if these are met, reimbursement can be up to 50-75% of the insured, prepaid, non-refundable trip costs if the trip is canceled at least two days before departure.
Travelers have also become increasingly concerned about holiday quarantine and additional costs. InsureMyTrip has worked to educate these travelers about travel delay benefits that can help cover additional accommodation costs when quarantined while on vacation.
Why do you think comparison sites like yours are important? What role do they play in the travel insurance market?
As I said before, travel insurance is not unique. Travelers have different travel insurance needs and wants. Comparison sites like InsureMyTrip give them options to find the right insurance for their wants and needs.
We know that many travel providers offer the option to check a coverage box at the point of sale, but this may have some shortcomings. First, it may only cover the part of your trip that you book at that time. Coverage may not be as comprehensive as other third party offerings. Some only refund future travel credits rather than refunding your money.
With InsureMyTrip, you can insure all of your prepaid, non-refundable travel expenses for the duration of your trip. Plus, customers have access to InsureMyTrip’s anytime attorneys who can help them if their claim is denied and need help figuring out why or initiating the appeal process.
How has the market evolved in the two decades since InsureMyTrip was founded?
We have seen more and more vendors join the market over the years. After 9/11, vendors added terrorism language to their policies. Also, as travel has evolved, we’ve seen different types of plans and coverage. For example, with the growing popularity of vacation rentals, we have seen the development of policies with specific coverage. This may include coverage if the rental is damaged, and charges are assessed by the owner.
As world events unfold, we see concerns evolve, some of which may be covered and some may not. For incidents where coverage may not be available, such as cancellation for fear of travel, CFAR (as explained above) can offer travelers the most flexibility to cancel their plans and recover most of their expenses. We have seen an increase in the number of customers seeking this benefit following the Covid-19 pandemic. Many want the flexibility to be able to cancel their plans and not lose all their money if their destination becomes a Covid hotspot or goes into lockdown. We have seen Covid-19 in general cause increased awareness of the need for travel insurance.
In terms of destinations, do you notice any particular trends regarding the destination of your customers?
We see a lot of people, myself included, wanting to escape to warmer places or ones that don’t have strict Covid restrictions. Travel data from InsureMyTrip reveals that six of the top 10 destinations for travelers in March 2022 were the tropical climates of Mexico, Bahamas, Costa Rica, Dominican Republic, Caribbean and Hawaii.
Travelers have stayed home for much of the past two years, and many are now ready to return.