The global business travel industry forecast is looking sunny. According to one report, business travel spending is on course to recover to its pre-pandemic levels by the end of 2024. And having recovered, it will only continue to grow. Global business travel spending was worth $1.03 trillion in 2022. By 2027, it is expected to grow to nearly $1.8 trillion.
In this article, Phil Denman an insurance expert from underwriting MGA, Capacity Insights, takes a look at the key corporate travel insurance trends to look out for in 2024, and beyond. We will also explore some of the key policy features that today’s business travellers value most.
Normality Brings Stability
We don’t need to explain how the business travel insurance sector struggled through the pandemic as employees across the world took fewer business trips. But the prevalence of remote work, coupled with the increasing sophistication and affordability of online meeting apps, means that the business travel insurance industry may have struggled even after restrictions were lifted.
Still, corporate travel insurance has bounced back from lockdown, and as we have seen, its future is looking bright. This is partially because businesses still recognise the value of face-to-face meetings. Yes, you could talk to that prospect over Zoom. But does it not send a much more powerful message if you take the time and trouble to travel and meet them on their terms?
No matter what happens to the wider world, businesses will likely always want to do things the old fashioned way: face-to-face, and direct. This means that there will always be business travel, which in turn means that there will always be a market for business travel insurance. It is for this reason that the latest Global business Travel Association forecast attributes the return of in-person meetings as the biggest driver of the industry’s stabilisation since mid-2023.
How Corporate Travel Insurance Has Evolved
This is not to say that the business travel insurance industry is just resting on its laurels. As ever, the industry has adapted to the changing attitudes in a changing world.
One way corporate travel insurance has evolved in recent years is through the rise of blended business and leisure travel insurance schemes. Increasingly, business travellers want to combine their business trips with some leisure time. For example, they might extend their stay in a foreign city into a weekend getaway.
Some refer to this trend as “bleisure” travel, and it may be the result of the shift towards a younger workforce, who are treating work-related travel excursions as an opportunity to see the world.
Corporate travel providers have evolved to meet this trend through offering more flexible cover arrangements. It is not a case of offering employees separate policies for their business travel and their leisure travel. If an employee wants to spend two nights in a hotel for business purposes, then a further three nights for some rest and relaxation, they will need a tailored policy that will give them all the cover they need for a single “bleisure” trip.
This desire for increased flexibility has encouraged the business travel insurance sector to embrace emerging technologies that make such personalisation possible. One recent survey highlighted how 80% of travellers expect to be able to book their trips fully online, while 76% rely on travel apps to streamline their experiences.
This is why “embedded insurance” remains such a hot button issue in the business travel insurance world – the rise of technologies that allow planners and travellers to get all the cover they need in a single transaction.
What Matters Most to Employees in Their Business Travel Insurance
Beyond the ability to blend their business and leisure travel, and beyond the need for streamlined online processes, these are the sort of policy features business travellers may value most in 2024 and beyond:
- Sustainability – Employees are becoming increasingly concerned about the environmental impact of their business travel. They are therefore likely to value any initiatives that can help make their travel more sustainable. The use of apps and online booking systems can help, as they allow for paperless travel. But even better is a policy that will cover them to choose more sustainable hotels or transportation options.
- Wellness – The pandemic made a lot of people pay attention to their health and wellbeing like never before. Business travellers are likely to value any policy features that prioritise their wellness. This could include cover for medical emergencies, including overseas medical bills or dental expenses. But it could also include cover for the sort of leisure activities that support good mental health, including massages, spa experiences, and even certain sports and activities.
- AI and Machine Learning – Not everyone feels the same way about artificial intelligence (AI). But everyone likes convenience. Business travel insurance providers could draw from AI and machine learning to analyse data trends in real-time. They could then provide travellers with a sort of virtual personal assistant, who can research and recommend hotels and itineraries on their behalf, and even predict travel delays before they become a problem.
Corporate Travel Insurance Has a Bright Future in an Uncertain World
True, there are many factors that could temper the sector’s rebound. Many sectors are affected by persistently high inflation, and global financial and political conditions will always be unpredictable.
But despite these challenges, we expect the industry to retain its current momentum. And as we have seen, there are some indications that the sector is on course to grow dramatically over the next few years.
Any insurer who is not currently offering flexible business travel insurance plans among their product lines risks missing out on a major opportunity for long-term sustainable growth. If you want to stay relevant in an ever-changing world, there has never been a better time to diversify your product lines.
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