The travel insurance market is set for a new phase of growth, after the easing of Covid restrictions in the UK and elsewhere, according to Dan Baldwin, (pictured) head of personal lines at specialist MGA Avid Insurance. The sector has been rocked by Covid and the subsequent reduction in insurance capacity, leading to new opportunities for growth among travel specialists.
Avid, which distributes A-rated products for leisure travellers through brokers, is targeting strong growth by the end of next year, aiming to build on its pre-Covid share of the travel insurance market.
He said: “We have really strong relationships with our specialist travel insurance distribution partners and we’ve really tried hard during the period when travel was in the doldrums to support them as best we could.”
“We have also invested in automating our reporting and analytics to deliver best in class, accurate MI to our partners and our capacity providers.”
He said that family holidays in Europe and short duration trips are the first to show signs of recovery this year and expects that long haul will return to pre-pandemic levels as people’s confidence to book those types of holidays increases.
He added: “Airline capacity is also limited for long haul and transatlantic flights, in line with continuing worries about Covid. Capacity will improve as public confidence improves.”
Dan said the pandemic had brought some valuable travel insurance lessons to the fore. “We have done a lot of work to try to develop and transition our product offerings to deliver coverage we believe is appropriate for the post pandemic market.”
Improvements to cover have included adding in the ability for policies to be extended where customers are unable to return home due to pandemic-related travel disruption or border closures.
RISING PREMIUMS
Dan added: “We need to continue improving our policies as well as the information being given to consumers at point-of-sale to provide clarity about the various risks we are insuring them for. Travel insurance is a complex product with a lot of different covers, although cancellation and medical expenses covers remain key in the Covid era.”
He noted that customers should also expect to pay more for cover.
“Prices are hardening because Covid and the resulting high demand for beds has created operational problems in some hospitals. This in turn has increased the costs of overseas medical care. Our medical assistance partners are also finding it more difficult to arrange for medical escorts or air ambulances to fly people home due to ongoing testing requirements and entry restrictions, which vary widely across different countries.”
“So our prime focus over the last two years has been to ensure that, working with our partners, our products are fit for purpose and the customer is at the heart of those policy decisions.”
Dan advised that Avid has agreed to sponsor the Travel Insurance Industry Conference (TIIC) in May, and recruited an additional specialist travel underwriter in January.
“Travel is a major pillar of Avid’s overall MGA proposition and our commitment to the TIIC event underlines this. While we are always on the lookout for underwriting talent, we have a strong team of experienced people and we are highly optimistic about market prospects for the rest of this year and into 2023.”
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