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UK Travel Insurance: Market Dynamics & Opportunities 2018

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Published Date : Jul 2018

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No. of Pages : 47 Pages

UK Travel Insurance: Market Dynamics & Opportunities 2018


"UK Travel Insurance: Market Dynamics & Opportunities 2018", report provides in-depth analysis of the UK travel insurance market. It looks at market size and profitability, as well as changes in premiums, claims, travel trends, regulation, and opportunities. It provides a thorough overview of the market along with future forecasts.

The UK travel insurance market experienced an increase of 0.9% in the number of policies being written in 2017, which resulted in GWP rising by a much more significant 7.9% to 614.3m due to average premiums rising. The number of UK residents going abroad without holding travel insurance increased again in 2017, mainly due to more trips to Europe being taken. Consumers either feel exposed to a lower level of risk in Europe or are overly reliant on their European Health Insurance Card. The cost of claims for travel insurers increased by 6.3% in 2017 to 510m, meaning it was outstripped by premium growth.


- Trips to Europe increased in 2017, at the expense of longer-haul flights (particularly to North America).
- Marginalized consumers are set to receive help accessing the market following a Financial Conduct Authority review.
- The UK travel insurance market is forecast to be worth 634.0m in 2023.

Reasons to buy

- Benchmark yourself against the rest of the market.
- Ensure you remain competitive as new innovations and insurance models begin to enter the market.
- Be prepared for how travel trends and the UK travel insurance market will be impacted by socio-political and economic factors over the next few years.
Table of Contents
1.1. Market summary 2
1.2. Key findings 2
1.3. Critical success factors 2
2.1. Introduction 7
2.2. UK travel insurance market GWP picked up in 2017 7
2.2.1. The number of policies was driven up by single trip growth 9
2.2.2. The trend of multi-trip policies increasing their share of market GWP has ended 10
2.2.3. Average travel insurance premiums increased 12
2.2.4. The influence of age on premium prices 13
2.2.5. Insurers must do more for cancer sufferers and other long-term conditions 15
2.3. Travel insurance and added-value accounts 16
2.3.1. Added-value accounts remain popular with travelers 16
2.3.2. The disadvantages of added-value account travel insurance policies 17
2.3.3. Travel insurance complaints remain high, despite a slight fall 17
2.4. Travel trends among UK residents 18
2.4.1. Travel abroad by UK residents continued to grow in 2017 18
2.4.2. Holidays remain the main purpose of traveling abroad 20
2.5. The influence of economic, socio-political, and health events on travel 21
2.5.1. The state of the UK economy has an impact on travel 21
2.5.2. The influence of exchange rates on trips abroad by UK residents 23
2.5.3. Social unrest in travel destinations 24
2.5.4. Air strikes and Monarchs collapse pose further problems for insurers 26
2.6. Travel insurance claims 26
2.6.1. The number of travel insurance claims continues to fall 26
2.6.2. Medical expenses outweigh cancelations in terms of claims costs 28
2.6.3. Changes in booking culture could reduce the cost of cancelations 30
2.6.4. The withdrawal of EHIC will provide a boost to insurers 30
3.1. AXA leads the way in the travel insurance space 32
3.1.1. Key affinity changes occurred in 2017 32
3.1.2. Challenger banks are entering the market 33
3.1.3. AXA is creating partnerships with third-party booking websites 35
3.1.4. Co-op Insurance kicks off cashless cover among mainstream insurers 35
4.1. Market forecasts 36
4.1.1. Current market forecast: UK travel insurance will experience modest growth 36
4.1.2. Market forecast: smooth Brexit process 38
4.1.3. Market forecast: hard Brexit process 39
4.2. Uncertainty in the UK economy 40
4.2.1. How the UK economy copes with Brexit is key for the travel market 40
4.3. Technology will influence the travel insurance market 40
4.3.1. Wearable tech could play a role in prevention 40
4.3.2. Virtual GP services could become commonplace 41
4.3.3. The development of flight delay policies 41
4.3.4. PassportCard claims to have created the worlds first real-time travel insurance 44
4.3.5. The concept of a travel insurance marketplace has emerged 44
5.1. Abbreviations and acronyms 46
5.2. Bibliography 46
5.3. Further reading 46

List of Tables
Table 1: UK travel insurance market GWP and annual growth rate, 2013-17 8
Table 2: Number of travel insurance policies written, 2011-17 9
Table 3: Share of UK travel insurance GWP by policy type, 2013-17 11
Table 4: Average premiums and percentage change by policy type, 2013 -17 12
Table 5: Average premium prices by demographic, 2015-17 14
Table 6: Total number of outbound UK visitors by destination (000s), 2012-17 19
Table 7: Number of overseas visits by purpose (000s), 2014-17 20
Table 8: Historical exchange rates relative to 1, 2013-17 30

List of Figures
Figure 1: The UK travel insurance market recovered in 2017 8
Figure 2: The number of policies rose in 2017, driven by growth in single trips 10
Figure 3: Single-trip policies increased their share after two years of multi growing 11
Figure 4: Multi-trip policies have been more expensive than single trip since 2016 13
Figure 5: Outbound tourism was up everywhere except North America in 2017 19
Figure 6: Holidays remain the most popular reason for traveling 21
Figure 7: The UK economy saw steady growth in 2017 22
Figure 8: Real wages are falling behind nominal wages as inflation outstrips wage growth 23
Figure 9: The value of the pound continues to fluctuate 24
Figure 10: Tourism in Western Europe recovers faster after terror attacks 25
Figure 11: Total claims rose as every category recorded an increase 27
Figure 12: Cancelations remain the leading reason for insurance claims 28
Figure 13: Cancelation claims costs grew sharply in 2017 29
Figure 14: Revolut offers GPS-based travel insurance 34
Figure 15: Travel GWP will stutter in 2018 and 2020, before recording significant growth in 2022 and 2023 37
Figure 16: GlobalData forecast model 38
Figure 17: App in the Air provides a full flight management service 42
Figure 18: Fizzy provides automatic compensation 43
Figure 19: PassportCard means consumers do not need to make upfront payments 44
Figure 20: TransferTravel.com allows customers who are unable to travel to sell their flight and hotel bookings 45

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