Table of Contents
Executive Summary
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- The market
- Travel insurance market expected to grow over the next five years
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- Figure 1: Forecast of value of gross written travel insurance premiums – Fan chart, 2009-19
- Market factors
- Overseas holidays are growing again
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- Figure 2: Domestic vs overseas holidays, 2010-14
- Claims costs fall slightly but remain a strain on profits
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- Figure 3: Value of travel insurance claims, 2004-13
- Companies, products and innovations
- AXA is the travel insurance market leader
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- Figure 4: Leading travel insurance underwriters, by GWP (UK business only), 2011-13
- The consumer
- 87% insured their holiday abroad in the last year
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- Figure 5: Proportion of holidaymakers covered by insurance on their last holiday abroad, October 2014
- The internet is the most used sales channel for travel insurance
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- Figure 6: Method of arranging travel insurance (last holiday abroad within last 12 months), October 2014
- Most travel insurance customers have never made a claim, but those who have are satisfied
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- Figure 7: Time since most recent travel insurance claim, October 2014
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- Figure 8: Satisfaction with most recent travel insurance claim, October 2014
- Price is the biggest consideration for travel insurance
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- Figure 9: Factors affecting choice of travel insurance, October 2014
- Half of consumers say travel insurance is essential
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- Figure 10: Agreement with statements about travel insurance, October 2014
- What we think
Issues and Insights
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- The problem with price
- The facts
- The implications
- If one size fits all, how can insurers stand out?
- The facts
- The implications
- What will be the marketplace of tomorrow?
- The facts
- The implications
Trend Application
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- There is still work to be done to clarify the role of EHICs
- Satisfied claimants are worth shouting about
- Help, wherever and whenever it’s needed
Market Drivers
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- Key points
- Consumer confidence stalled in 2014…
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- Figure 11: Financial health index, 2009-15
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- Figure 12: Financial confidence index, 2009-15
- …but holidays are a spending priority for many
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- Figure 13: “Where do you choose to spend your extra money (once all of your bills are paid and you have bought all of the things you really need)?”, January 2015
- Domestic destinations are more common than overseas breaks…
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- Figure 14: Holiday destinations visited in the last 12 months, October 2014
- …but foreign holidays are on the up again
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- Figure 15: Domestic vs overseas holidays, 2010-14
- Claims costs fall slightly…
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- Figure 16: Volume and value of travel insurance claims, 2004-13
- …but average claims costs are up
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- Figure 17: Average cost of travel insurance claims, by type of claim, 2009-13
- Most claims are for medical expenses
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- Figure 18: Share of value of travel insurance claims, by type of claim, 2013
- Increasing cost of holidays highlights need for cover
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- Figure 19: Average cost of holidays, 2010-14
SWOT Analysis
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- Figure 20: SWOT analysis of the UK travel insurance market, February 2015
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Who’s Innovating?
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- Key points
- The need for informed innovation
- All-inclusive products
- Providing access to real-time information
- Developing broader cover
Market Size and Forecast
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- Key points
- Market contraction continued in 2013
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- Figure 21: Volume and value of total travel insurance policy sales, 2009-14
- Annual policies dominate the travel insurance market
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- Figure 22: Single-trip vs annual travel insurance policy sales, 2009-13
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- Figure 23: Annual vs single-trip travel insurance policies, by share of total market, by GWP, 2009-13
- Premium prices remain stagnant
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- Figure 24: Average travel insurance premium, single-trip vs annual policies, 2009-13
- Market forecast
- Number of annual policy sales expected to grow by 11% by 2019…
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- Figure 25: Forecast of volume of travel insurance policies sold – Fan chart, 2009-19
- Figure 26: Forecast of volume of travel insurance policies sold, 2009-19
- …while GWP is expected to increase by 23% in the next five years
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- Figure 27: Forecast of value of gross written travel insurance premiums – Fan chart, 2009-19
- Figure 28: Forecast of value of gross written travel insurance premiums, 2009-19
- Forecast methodology
- Fan chart explanation
Market Share
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- Key points
- AXA is the market leader in travel insurance
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- Figure 29: Leading travel insurance underwriters, by GWP (UK business only), 2011-13
- The importance of partnerships
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- Figure 30: Current account provider rankings, by share of main current account market, May 2014, and banks’ travel insurance providers, February 2015
Companies and Products
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- AXA
- Travel insurance product range
- Market position
- Recent activity
- Aviva
- Travel insurance product range
- Market position
- Recent activity
- Direct Line Group
- Travel insurance product range
- Market position
- Recent activity
- Cigna Insurance Services
- Travel insurance product range
- Market position
- Recent activity
- Ageas UK
- Travel insurance product range
- Market position
- Recent activity
Brand Research
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- What you need to know
- Brand map
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- Figure 31: Attitudes towards and usage of selected brands, December 2014
- Key brand metrics
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- Figure 32: Key metrics for selected brands, December 2014
- Brand attitudes: AA Insurance, Aviva and AXA most noted for quality
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- Figure 33: Attitudes, by brand, December 2014
- Brand personality: Advertising tends to shape personality traits, with Direct Line and Churchill most likely to be seen as upbeat
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- Figure 34: Brand personality – Macro image, December 2014
- Lesser-known brands Columbus Direct and InsureandGo struggle to create positive brand associations
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- Figure 35: Brand personality – Micro image, December 2015
- Brand analysis
- AA Insurance uses strong background in roadside assistance expertise to its advantage
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- Figure 36: User profile of AA Insurance, December 2014
- Aviva enjoys all-round brand strength
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- Figure 37: User profile of Aviva, December 2014
- Post Office Insurance has a strong association with customer service thanks to staff interaction at branches
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- Figure 38: User profile of Post Office Insurance, December 2014
- AXA has a more serious brand image among consumers
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- Figure 39: User profile of AXA, December 2014
- InsureandGo relies on its strong value element
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- Figure 40: User profile of InsureandGo, December 2014
- MORE TH>N could define itself a little more clearly
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- Figure 41: User profile for MORE TH>N, December 2014
- Churchill
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- Figure 42: User profile of Churchill, December 2014
- Direct Line is upbeat and well known, but has second-highest proportion of negative reviews
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- Figure 43: User profile of Direct Line, December 2014
- Saga Insurance has an advantage through its 50+ specialism
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- Figure 44: User profile of Saga Insurance, December 2014
- Columbus Direct struggles to create an impression on consumers
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- Figure 45: User profile of Columbus Direct, December 2014
Brand Communication and Promotion
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- Key points
- Travel insurance adspend fell by 10% in 2014
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- Figure 46: Total adspend in the UK travel insurance market, 2010-14
- Staysure is the highest-spending travel insurance advertiser
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- Figure 47: Top six travel insurance advertisers, 2012-14
- Television is the dominant medium for travel insurance advertising
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- Figure 48: Total travel insurance adspend, by media type, 2014
- A note on adspend
Channels to Market
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- Key points
- Most holidaymakers bought their travel insurance online
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- Figure 49: Method of arranging travel insurance (last holiday abroad within last 12 months), October 2014
- Can travel agents do more at the point of sale?
- Convenience is more important for arranging single-trip policies
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- Figure 50: Method of arranging travel insurance (last holiday abroad within last 12 months), by type of cover held, October 2014
Travel Insurance Taken Out on Last Holiday Abroad
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- Key points
- The vast majority of overseas travellers insured their last trip
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- Figure 51: Proportion of holidaymakers covered by insurance on their last holiday abroad, October 2014
- Single-trip policies remain popular…
- …but annual policies are favoured by better-off travellers
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- Figure 52: Type of travel insurance taken out for last overseas holiday (last 12 months), by gross annual household income, October 2014
- A quarter of under-25s went on holiday uninsured
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- Figure 53: Percentage of people who did not get travel insurance for their last holiday abroad, by age, October 2014
Claims Experience and Satisfaction
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- Key points
- Most travel insurance customers have never made a claim
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- Figure 54: Time since most recent travel insurance claim, October 2014
- Four fifths of claimants were satisfied with how their claim was handled
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- Figure 55: Satisfaction with most recent travel insurance claim, October 2014
- Annual policyholders are more likely to make a claim
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- Figure 56: Incidence of travel insurance claims, by type of travel insurance held for last overseas holiday (in the last 12 months), October 2014
Factors Affecting Choice of Travel Insurance
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- Key points
- Price is key in choosing a policy…
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- Figure 57: Factors affecting choice of travel insurance policy, October 2014
- …but excess costs are an afterthought for many
- Health comes before possessions…
- …and concern about pre-existing conditions increases with age
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- Figure 58: Agreement that ‘cover for pre-existing medical conditions’ is one of the three most important considerations when choosing a travel insurance policy, by age, October 2014
- Little interest in cash cover
Attitudes towards Travel Insurance
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- Key points
- Half see travel insurance as essential
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- Figure 59: Agreement with statements about travel insurance, October 2014
- Only 37% take their cover documents away with them
- Older consumers are more cautious
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- Figure 60: Agreement with the statements “It is essential to have travel insurance when you go abroad” and “I always take my travel insurance documents with me when I go on holiday”, by age, October 2014
- Lack of trust is a barrier to purchase
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- Figure 61: Agreement with the statement “I do not trust travel insurance companies to pay out fairly in the event of a claim”, by whether consumers had travel insurance for their last overseas holiday (last 12 months), October 2014
- Few are concerned about getting a bespoke product
- One in six still think an EHIC is enough
Appendix – Market Size and Forecast
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- Volume
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- Figure 62: Best- and worst- case forecast of volume of travel insurance policies sold, 2014-19
- Value
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- Figure 63: Best- and worst-case forecast of gross written travel insurance premiums, 2014-19
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