Policybazaar.ae, a leading insurance and financial products marketplace announced that there has been a significant rise in demand for travel insurance in FY21-22 in the UAE. The fintech company saw a 150% increase in sale of travel insurance policies where travelers bought more policies in Quarter 2 in comparison to the Quarter 1 of 2022. The company saw a rise in demand from top tourist destinations such as the USA, Schengen countries, Indonesia, UK amongst others - as majority of these countries have made travel insurance mandatory along with other valid travel documents.
Apart from the countries where travel insurance is mandatory, the other reason behind more travelers buying travel insurance policy is due to lingering dread of the pandemic. The other major reason resulting in an increase in the sale of travel insurance policy was due to a knock-on effect on the luggage mishandling situation such as either lost or delayed baggage, due to acute shortage of baggage handlers at the airports.
The global travel insurance market size was valued at $12.38 billion in 2020, and is projected to reach $119.31 billion by 2030. This translates to a growth at a CAGR of 26.1% from 2021 to 2030. While travel has picked up its pace globally, airports around the world are facing extremely high levels of flight cancellations and delays in the past few months. Having a travel insurance policy may not be mandatory for tourists in all the countries, but it is always recommended to have one when traveling abroad. Travel insurance policy compensates travelers from undue expenses in situations of a medical emergency, personal liability, or other emergencies like loss of baggage.
Delaying or losing check-in baggage is one of the most common adversities faced by travelers. Nearly 220,000 bags were "mishandled" by U.S. airlines in April 2022, meaning they were lost, damaged, delayed or stolen, according to the most recent data published by the U.S. Department of Transportation. Especially in bigger European airports (Amsterdam, London etc.), many travelers fly via inter-connected flights - luggages were either being left behind or missing due to staff shortages. The airline might provide a mere compensation which is surely not enough. Fortunately, travel insurance companies provide coverage for baggage delay as well as baggage loss.
Neeraj Gupta, CEO, Policybazaar.ae said: "One thing the pandemic has taught us is to take necessary precautions and we will see a rise in travel insurance especially for Covid or unexpected medical costs, loss or delay of baggage. Baggage coverage is a very important benefit within travel insurance plans, as it can provide monetary assistance when things go wrong with your luggage during a trip. Hence, it would be wise for people to have a comprehensive travel insurance policy to enjoy a hassle-free trip.”