Table of Contents
Executive Summary
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- The market
- Muted growth in market value in 2015
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- Figure 1: Travel insurance gross written premium and claims incurred/loss ratio, 2011-15
- Total claims costs have steadily decreased
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- Figure 2: Cost of travel insurance claims incurred, by type of claim, 2011-14
- Key players
- AXA returns to growth at the top of the market
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- Figure 3: Leading travel insurance underwriters, by GWP (UK business only), 2014
- Post Office stands out from rivals with recent rebrand
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- Figure 4: Attitudes towards and usage of selected finance brands, November 2015
- The consumer
- 84% had insurance cover for their last holiday abroad
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- Figure 5: Proportion of people who had any travel insurance cover for their last holiday abroad, by age, November 2015
- Direct channel takes close second behind comparison sites
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- Figure 6: Travel insurance provider for last holiday abroad, November 2015
- One in 10 holidaymakers arranged their insurance using a smartphone or tablet
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- Figure 7: Travel insurance arrangement method for last holiday abroad, November 2015
- Two thirds arranged their insurance within a month of departure
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- Figure 8: Travel insurance arrangement timeframe for last holiday abroad, November 2015
- Travel insurance suffers from an overriding sense of obligation
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- Figure 9: Attitudes towards travel insurance, November 2015
- Protection against failure of travel companies is key for customers
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- Figure 10: Interest in different aspects of cover, November 2015
- 45% of people are interested in managing claims using their smartphone
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- Figure 11: Most useful mobile app features, November 2015
- What we think
Issues and Insights
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- Mobile apps with claims functionality could help build brand
- The facts
- The implications
- Too many cheap policies come at the price of customer protection
- The facts
- The implications
- Point-of-departure sales could serve the forgetful and the fearless
- The facts
- The implications
The Market – What You Need to Know
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- Muted growth in market value in 2015
- Claims volumes slide but costs are on the rise
- Growth in the number of holidays is limited
Market Size and Forecast
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- Muted growth in market value in 2015
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- Figure 12: Travel insurance gross written premium and claims incurred/loss ratio, 2011-15
- Average premiums grow and single trip insurance shows a slight upturn
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- Figure 13: Travel insurance volume, value and average premium, by cover type, 2011-14
- Figure 14: Proportion of annual vs single-trip travel insurance policies, by GWP, 2011-14
- Market value to increase by 4.5% by 2020 …
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- Figure 15: Forecast of value of gross written travel insurance premiums, 2010-20
- Figure 16: Forecast of value of gross written travel insurance premiums, 2010-20
- …and policy volume will slip further before recovering
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- Figure 17: Forecast of volume of travel insurance policies, 2010-20
- Figure 18: Forecast of volume of travel insurance policies, 2010-20
- Forecast methodology
Claims Patterns
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- Total claims costs have steadily decreased
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- Figure 19: Cost of travel insurance claims incurred, by type of claim, 2011-14
- Only baggage and money claims grew in number during 2014
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- Figure 20: Number of travel insurance claims incurred, by type of claim, 2011-14
- Claims success rates show the majority of claims are paid
The Overseas and Domestic Travel Market
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- Two thirds have holidayed in the UK in the past year
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- Figure 21: Holiday destinations visited in the past 12 months, November 2015
- Growth in the number of holidays is limited
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- Figure 22: Estimated total holiday market, volume, value and average spend, 2010-20
- Global migration is driving an increase in visits abroad
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- Figure 23: UK residents’ visits abroad, by purpose of visit, 2011-14
Key Players – What You Need to Know
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- AXA leaves rivals behind at the top of the market
- Mobile presents a clear opportunity to differentiate
- Saga and Staysure battle it out for dominance among older customers
- Brand research reveals the strength of Post Office
Underwriter Share
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- AXA returns to growth at the top of the market
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- Figure 24: Leading travel insurance underwriters, by GWP (UK business only), 2012-14
Competitive Strategies
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- Making the most of mobile
- ACE Group
- ERV
- Distribution shifts as insurers look beyond the aggregators
- Columbus Direct
- Staysure
- Growing over-50s market attracts strategic investment
- Talk to TIM
- Swinton
Advertising and Marketing Activity
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- Insurers scale back their use of direct mail
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- Figure 25: Recorded above-the-line, online display and direct mail advertising expenditure on UK travel and sports insurance, by media type, 2012/13-2014/15*
- Staysure invests heavily to rival Saga for older customers
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- Figure 26: Top 8 advertisers of travel and sports insurance, by recorded above-the-line, online display and direct mail advertising, by media type, 2012/13-2014/15*
- Search and social media are growing in importance
- Nielsen Media Research coverage
Brand Research
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- What you need to know
- Brand map
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- Figure 27: Attitudes towards and usage of selected finance brands, November 2015
- Key brand metrics
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- Figure 28: Key metrics for selected finance brands, November 2015
- Brand attitudes: AXA and Aviva lead the way with reputation for quality
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- Figure 29: Attitudes, by brand, November 2015
- Brand personality: Advertising has helped Direct Line invigorate its brand
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- Figure 30: Brand personality – Macro image, November 2015
- Sainsbury’s and Tesco are struggling to get their finance message across
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- Figure 31: Brand personality – Micro image, November 2015
Brand Analysis
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- Retailer brands lack clarity when it comes to finance
- Saga and Staysure brands are driven by standard of service
- Longstanding insurers inspire confidence
- The Thomas Cook brand is under pressure
- Post Office stands out from rivals with recent rebrand
The Consumer – What You Need to Know
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- 84% had insurance cover for their last holiday abroad
- Direct channel is a close second behind the aggregators
- One in 10 holidaymakers arranged their insurance using a smartphone or tablet
- Two thirds arranged their insurance within a month of departure
- Protection against failure of travel companies is key for customers
- 45% of people are interested in managing claims using their smartphone
Travel Insurance Cover for Last Holiday Abroad
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- 84% had insurance cover for their last holiday abroad
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- Figure 32: Travel insurance cover for last holiday abroad, November 2015
- Youngest travellers are least likely to arrange protection
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- Figure 33: Proportion of people who had any travel insurance cover for their last holiday abroad, by age, November 2015
Type of Travel Insurance Provider for Last Holiday Abroad
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- Direct channel takes close second behind comparison sites
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- Figure 34: Travel insurance provider for last holiday abroad, November 2015
- Post Office has garnered a following among Millennials
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- Figure 35: Travel insurance provider for last holiday abroad, by generation, November 2015
Method of Arranging Policy
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- One in 10 holidaymakers arranged their insurance using a smartphone or tablet
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- Figure 36: Method of arranging insurance for last holiday abroad, November 2015
- One in five over-55s arranged insurance by phone
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- Figure 37: Proportion of people who arranged the travel insurance for their last holiday by phone, by age, November 2015
Timeframe for Arranging Policy
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- Two thirds arranged their insurance within a month of departure
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- Figure 38: Travel insurance arrangement timeframe for last holiday abroad, November 2015
- Millennials are most likely to leave insurance until the last minute
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- Figure 39: Travel insurance arrangement timeframe for last holiday abroad, by age, November 2015
Attitudes towards Travel Insurance
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- Travel insurance suffers from an overriding sense of obligation
- Struggle to see value in annual policies
- Airport kiosks will need to convince people they offer value for money
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- Figure 40: Attitudes towards travel insurance, November 2015
Most Important Factors in Choosing a Policy and Provider
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- Price and level of cover strike an uneasy balance for customers
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- Figure 41: Most important factors in choosing a travel insurance policy and provider, November 2015
- Quality factors gain importance as customers age
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- Figure 42: Most important factors in choosing a travel insurance policy and provider, by age, November 2015
Interest in Different Aspects of Cover
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- Protection against failure of travel companies is key for customers
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- Figure 43: Interest in different aspects of cover, November 2015
- Millennials more likely to lack interest in cover specifics
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- Figure 44: Interest in different aspects of cover, by generation, November 2015
Most Useful Mobile App Features
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- 45% of people are interested in managing claims using their smartphone
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- Figure 45: Most useful mobile app features, November 2015
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Figure 46: Forecast of value of gross written travel insurance premiums, 2015-20
- Figure 47: Forecast of volume of travel insurance policies, 2015-20
- Forecast methodology
- Fan chart explanation
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