Australia: 2022 Travel Insurance Outlook - Ancileo
Australia-2022-Travel-Insurance-Outlook

Psyche of the Australian Endemic Traveler: 2022 Travel Insurance Outlook

Relative to Asia-Pacific counterparts, Australia makes up for the lowest percentage of travelers intending to purchase travel insurance for their domestic (44%) and regional/international trips (55%). In the regard of travel insurance, most Australian travelers do not have a preferred brand.

Emergency medical is ranked the top when it comes to the most valued coverage in travel insurance. There is also some potential to tap on in the regard of their openness to purchase insurance from travel players.

Let’s get into the specifics of consumer sentiments in the Australian market when it comes to embedded travel insurance. The consumer research is part of Ancileo’s 2022 Travel Insurance Whitepaper, in which you can find the key highlights gathered from the global research deck in our post here.

Outlook of Travel Insurance in Australia

Despite the relatively meager 55% who would purchase travel insurance for their vacation in 2022, 74% amongst those not planning to travel indicated that they would purchase travel insurance if they were to travel for essential reasons. Key statistics specific to consumers profiles include 67% of the boomers (55-69) indicating that they will purchase travel insurance for all types of travel, and 57% amongst travelers intending to travel internationally are Gen X and Y (25-55).

Preferred-brands-to-get-travel-insurance

Preferred brands to get travel insurance

 Majority have no brand loyalty towards insurer brands but there are preferred brands that stood out as shown in the graphic above. Carole Tokody, CEO of Crisis Cover, posited a lack of certainty that consumers experience when it comes to what they are covered for. As policies are generally sold with complex wordings, offering simplicity and transparency in the offerings is something insurers and intermediaries-alike can leverage upon to improve buy-in.

 Pricing is the top influencing factor when evaluating a travel insurance plan to purchase. Other influencing factors include COVID-19 benefits which hold significant importance to travelers aged 35 and above, and that personalisation of plan is most valued by budget travelers and travelers intending to travel with their parents/spouses.

Why buy insurance? As it has been iterated above, emergency & medical expenses coverage is perceived as a key priority across all age groups. Also, trip cancellation and baggage coverages are particularly valued by domestic travelers going on short trips (1-3 nights), and travelers intending to go on resort-based holiday (i.e. Disney World).

Top-reasons-to-buy-travel-insurance

Top reasons to buy travel insurance

Where is Australia now in Embedded Insurance?

Reasons-to-buy-not-buy-insurance-via-in-path-embedded-means

Reasons to buy/not buy insurance via in-path/embedded means

 As with the other markets, convenience and price discounts make for strong influencing factors for consumers to buy travel insurance via in-path/embedded means. Other factors include personalization of plan especially for purchase through travel players. Majority of the luxury travelers (first class flyers) indicate a preference to purchase directly from their preferred insurer.

You can tell from the reasons cited by Australian travelers that deter them from buying via in-path/embedded means center around consumer psychoeducation. Consumers want clarity on what they are paying for, and evaluation is not briefly done at the point-of-purchase but a process that takes time and various interventions to psychoeducate the consumer.

Brett Thomson, General Manager of Corporate Travel at TAG, a global travel and event management company, opined that various players need to align in partnerships to provide a more streamlined experience to the end user. There is great potential in capitalizing upon travel technology for risk management and personalization of offerings.

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