Table of Contents
Executive Summary
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- The market
- Market expected to grow in 2013
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- Figure 1: Forecast for total value of travel insurance GWP, 2007-17
- Channels to market
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- Figure 2: Channels used to purchase travel insurance, 2008-12
- Market factors
- Trips to Europe increased, but trips outside Europe fell
- Number and cost of claims reduce
- ‘Signposting’ introduced to help older consumers purchase travel insurance
- Companies, brands and innovations
- The Post Office brand stands out from the crowd on trust
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- Figure 3: Attitudes towards and usage of brands operating in the travel insurance sector, November 2012
- Who’s innovating?
- The consumer
- Travel and holiday trends
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- Figure 4: Holiday destinations, October 2012
- Travel insurance ownership
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- Figure 5: Travel insurance arrangements, October 2012
- Travel insurance purchasing behaviour
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- Figure 6: Travel insurance purchasing, October 2012
- Attitudes towards travel insurance
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- Figure 7: Attitudes towards travel insurance, October 2012
- Travel insurance behaviours
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- Figure 8: Behaviours towards travel insurance, October 2012
- What we think
Issues in the Market
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- Has the complexity of the travel insurance market led to a lack of consumer trust?
- Are young people being ignored within the travel insurance market?
- Will the launch of ‘signposting’ make it easier for older customers to get affordable travel insurance?
- Is there scope to increase the use of technology in the travel insurance market?
Trend Application
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- Mobile phone apps to appeal to a younger audience
- No-claims discounts to encourage greater loyalty
- Focusing on the over-55s market will provide potential for growth
Market Drivers
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- Key points
- The financial crisis impacts holiday trends
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- Figure 9: Domestic vs. overseas holidays, 2005-12
- Trips to Europe increase, whilst longer-haul trips continue to decline
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- Figure 10: Outbound holiday visits, by region visited, 2007-11
- Large reduction in the number of claims incurred
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- Figure 11: Travel insurance claims incurred, by volume and value, 2004-11
- Cost per claim of medical expenses
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- Figure 12: Cost per medical travel insurance claim, 2004-11
- Medical expenses are most costly
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- Figure 13: Number of claims incurred, by type of claim, 2011
- ‘Signposting’ helps older consumers
- Many consumers are ordering an EHIC as an alternative to travel insurance
- Going on holiday is seen as a luxury, but a necessary one
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- Figure 14: Agreement with the statement ‘Holidays are a luxury and holidays are a necessary spend’, October 2012
- A fifth of consumers spend spare money on holidays
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- Figure 15: Trends in what extra money is spent on, December 2009-December 2012
- The Pound nudges up against the Euro and Dollar
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- Figure 16: Spot exchange rates, US Dollar and euro into Pound Sterling, January 2008-November 2012
- FSA regulation on selling travel insurance through bank accounts
SWOT Analysis
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- Figure 17: Travel insurance – SWOT analysis, 2012
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Who’s Innovating?
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- Key points
- EHIC app innovation
- Confused.com launches new price comparison service for people with pre-existing medical conditions.
- First Assist launches Travel Insurance Plus for higher-risk customers
- OK to Travel puts no upper age limit on cover
- Travel Insurance being offered on cashback websites
- Direct Line aims to build brand loyalty through multi-product discounts
- Live Chat customer service
Market Size and Forecast
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- Key points
- Number of policies written increases, but GWP remains flat
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- Figure 18: Volume and value of single-trip and annual policies, 2006-12
- Number of annual policies increasing, making up for the decrease in single policy sales
- GWP is expected to gradually rise through to 2017
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- Figure 19: Forecast for total value of travel insurance GWP, 2007-17
- Figure 20: Forecast for total market travel insurance GWP, 2007-17
- Travel insurance policies are expected to grow at a faster rate
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- Figure 21: Forecast for total number of travel insurance policies written, 2007-17
- Figure 22: Forecast for total market volume for travel insurance policies written, 2007-17
- Forecast methodology
Market Share
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- Key points
- AXA still has the largest share of the market
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- Figure 23: Top ten travel insurance underwriters, by GWP, 2009-11
- Aviva, ACE and Ageas all make gains
- Direct Line Group loses ground
Companies and Products
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- AXA UK
- Aviva
- Direct Line Group
- Aria Assistance
- AIG (formerly Chartis)
- Munich Re
- Ageas
Brand Research
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- Brand map
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- Figure 24: Attitudes towards and usage of brands operating in the travel insurance sector, November 2012
- Correspondence analysis
- Brand attitudes
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- Figure 25: Attitudes, by travel insurance brand, November 2012
- Brand personality
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- Figure 26: Travel insurance brand personality – macro image, November 2012
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- Figure 27: Travel insurance brand personality – micro image, November 2012
- Brand experience
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- Figure 28: Usage of brands operating in the travel insurance market, November 2012
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- Figure 29: Satisfaction with various brands operating in the travel insurance market, November 2012
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- Figure 30: Consideration of brands operating in the travel insurance market, November 2012
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- Figure 31: Consumer perceptions of current performance for brands operating in the travel insurance market, November 2012
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- Figure 32: Travel insurance brand recommendation – Net Promoter Score, November 2012
- Brand index
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- Figure 33: Travel insurance brand index, November 2012
- Figure 34: Travel insurance brand index vs. recommendation, November 2012
- Target group analysis
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- Figure 35: Target groups, November 2012
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- Figure 36: Usage of brands operating in the travel insurance market, by target groups, November 2012
- Group One – Conformists
- Group Two – Simply the Best
- Group Three – Shelf Stalkers
- Group Four – Habitual Shoppers
- Group Five – Individualists
Brand Communication and Promotion
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- Key points
- Adspend increases for the third year in a row
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- Figure 37: Topline adspend for travel insurance, 2009/10-2011/12
- Saga remains the biggest spender
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- Figure 38: Top ten travel insurance advertisers, 2009/10-2011/12
- TV ad expenditure is on the increase
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- Figure 39: Travel insurance adspend, by media type, 2011/12
Channels to Market
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- Key points
- Direct remains the most popular way to purchase
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- Figure 40: Channels used to purchase travel insurance, 2008-12
- Internet sales continue to increase
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- Figure 41: Methods used to arrange travel insurance, 2008-12
Travel and Holiday Trends
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- Key points
- Europe is the most popular destination for travellers
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- Figure 42: Holiday destinations, October 2012
- A quarter have not been on holiday in the last twelve months
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- Figure 43: Responses to the statement ‘I have not been on holiday in the last 12 months’ by current financial situation, October 2012
- The young are more likely to travel
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- Figure 44: Holiday destinations, by age, October 2012
- Increase in the number taking more than one holiday
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- Figure 45: Total number of trips abroad, 2010-12
Travel Insurance Ownership
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- Key points
- Most people want cover when they travel abroad
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- Figure 46: Travel insurance arrangements, October 2012
- Nearly 50% of overseas travellers have annual travel insurance cover
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- Figure 47: Travel insurance arrangements, October 2012
- Affluent go for annual policies, whilst middle incomes go for single-trip cover
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- Figure 48: Travel insurance arrangements, by household income, October 2012
- Younger consumers are less likely to have travel insurance
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- Figure 49: Travel Insurance arrangements, by demographics, October 2012
Arranging Travel Insurance
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- Key point
- Online is the most popular way to purchase
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- Figure 50: Channels used to arrange cover, October 2012
- Offline channels are still important for purchasing insurance
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- Figure 51: Channels used to arrange cover, by age group October 2012
Travel Insurance Purchasing Considerations
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- Key points
- Medical expenses are consumers biggest consideration
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- Figure 52: Travel insurance purchasing considerations, October 2012
- People don’t talk about travel insurance
- The trade-off between price and brand
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- Figure 53: Travel insurance purchasing considerations, by age, October 2012
Travel Insurance Behaviours
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- Key points
- Shopping around for travel insurance
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- Figure 54: Behaviours towards travel insurance, October 2012
- Complex terms and conditions
- One in five choose to rely on the EHIC
Attitudes towards Travel Insurance
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- Key points
- Consumers see the value of travel insurance
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- Figure 55: Attitudes towards travel insurance, October 2012
- Travel insurance is essential to the holiday experience
- Everyone wants quality of cover
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- Figure 56: Agreement with statement ‘It is important to look at the quality of cover, and not just focus on price’, by age, October 2012
- Travel insurance still generally seen as expensive
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- Figure 57: Agreement with statement ‘Some travel insurance policies are far too expensive’, by age and working status, October 2012
- Consumers face policy confusion
- Can travel insurers be trusted to pay out on a claim?
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- Figure 58: Agreement with statement ‘I do not trust insurers to pay out on travel insurance claims’ , October 2012
- Attitudes vary depending on purchasing method
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- Figure 59: Attitudes towards travel insurance, by travel insurance purchasing, October 2012
Appendix – Market Drivers
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- Domestic vs overseas holidays, 2005-12
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- Figure 60: Domestic vs. overseas holidays, 2005-12
Appendix – Market Size and Forecast
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- Total value of travel insurance
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- Figure 61: Forecast for total market travel insurance GWP, 2007-17
- Total volume of travel insurance
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- Figure 62: Forecast for total market volume for travel insurance policies written, 2007-17
- Value of annual travel insurance
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- Figure 63: Forecast for value of annual travel insurance GWP, 2007-17
- Figure 64: Forecast for value of annual travel insurance GWP, 2007-17
- Figure 65: Best- and worst-case forecast for annual travel insurance GWP, 2012-17
- Volume of annual travel insurance
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- Figure 66: Forecast for annual travel insurance policies written, 2007-17
- Figure 67: Forecast for total annual travel insurance policies written, 2007-17
- Figure 68: Best- and worst-case forecast for annual travel insurance policies written, 2012-17
- Value of single-trip travel insurance
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- Figure 69: Forecast for value of single-trip travel insurance GWP, 2007-17
- Figure 70: Forecast for value of single-trip travel insurance GWP, 2007-17
- Figure 71: Best- and worst-case forecast for single-trip travel insurance GWP, 2012-17
- Volume of single-trip travel insurance
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- Figure 72: Forecast for single-trip travel insurance policies written, 2007-17
- Figure 73: Forecast for single-trip travel insurance policies written, 2007-17
- Figure 74: l Best- and worst-case forecast for single-trip travel insurance policies written, 2012-17
Appendix – Brand Research
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- Figure 75: Brand usage, November 2012
- Figure 76: Brand usage, November 2012 (continued)
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- Figure 77: Brand commitment, November 2012
- Figure 78: Brand commitment, November 2012 (continued)
- Figure 79: Brand momentum, November 2012
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- Figure 80: Brand momentum, November 2012 (continued)
- Figure 81: Brand diversity, November 2012
- Figure 82: Brand diversity, November 2012 (continued)
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- Figure 83: Brand satisfaction, November 2012
- Figure 84: Brand satisfaction, November 2012 (continued)
- Figure 85: Brand recommendation, November 2012
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- Figure 86: Brand recommendation, November 2012 (continued)
- Figure 87: Brand attitude, November 2012
- Figure 88: Brand attitude, November 2012 (continued)
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- Figure 89: Brand image – macro image, November 2012
- Figure 90: Brand image – macro image, November 2012 (continued)
- Figure 91: Brand image – micro image, November 2012
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- Figure 92: Brand image – micro image, November 2012 (continued)
- Figure 93: Profile of target groups, by demographics, November 2012
- Figure 94: Psychographic segmentation, by target groups, November 2012
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- Figure 95: Brand usage, by target groups, November 2012
- Brand index
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- Figure 96: Brand index, November 2012
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Appendix – Travel and Holiday Trends
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- Figure 97: Most popular holiday destinations, by demographics, October 2012
- Figure 98: Next most popular holiday destinations, by demographics, October 2012
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- Figure 99: Most popular types of holiday taken, by demographics, October 2012
- Figure 100: Next most popular types of holiday taken, by demographics, October 2012
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- Figure 101: Other types of holiday taken, by demographics, October 2012
- Figure 102: Least popular types of holiday taken, by demographics, October 2012
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Appendix – Travel Insurance Ownership
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- Figure 103: Most popular travel insurance arrangements, by demographics, October 2012
- Figure 104: Most popular travel insurance arrangements, by demographics, October 2012
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Appendix – Arranging Travel Insurance
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- Figure 105: Travel insurance purchasing, by demographics, October 2012
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Appendix – Travel Insurance Purchasing Considerations
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- Figure 106: Most popular travel insurance purchasing considerations, by demographics, October 2012
- Figure 107: Next most popular travel insurance purchasing considerations, by demographics, October 2012
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- Figure 108: Other travel insurance purchasing considerations, by demographics, October 2012
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Appendix – Travel Insurance Behaviours
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- Figure 109: Most popular attitudes and behaviours towards travel insurance, by demographics, October 2012
- Figure 110: Next most popular attitudes and behaviours towards travel insurance, by demographics, October 2012
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Appendix – Attitudes towards Travel Insurance
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- Figure 111: Agreement with the statements ‘It is important to look at the quality of cover, and not just focus on price’ and ‘It’s essential to have travel insurance when you go abroad’, by demographics, October 2012
- Figure 112: Agreement with the statements ‘Travel insurance gives me peace of mind for my holiday’ and ‘Some travel insurance policies are far too expensive’, by demographics, October 2012
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- Figure 113: Agreement with the statements ‘Travel insurance policies have too many exclusions and too much small print’ and ‘There are so many travel insurance products on the market it’s difficult to find the right policy’, by demographics, October 2012
- Figure 114: Agreement with the statements ‘I do not trust insurers to pay out on travel insurance claims’ and ‘Travel insurance is an unnecessary expense’, by demographics, October 2012
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- Figure 115: Agreement with the statement ‘All travel insurance policies are the same’, by demographics, October 2012
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