Travellers must acknowledge that cost of ignoring insurance becoming too great

With June 2024’s heatwave feeling like a distant memory amid an increasingly overcast July, many Brits will excitingly be looking ahead to their summer holidays – however, the travel insurance sector is keen to remind tourists to both understand and insure their risks appropriately as appetite around travel and climate change ramifications impact holiday trends and considerations.

Research from travel insurance broker AllClear, published in July 2024, provides a comprehensive, overarching view of holiday trends in the UK this year – and what holidaymakers intend to do about their travel insurance.

This firstly found that 83% of Britons want to get away for a holiday abroad this summer.

Four in five of the broker’s 2,106 respondents said they were keen to take a holiday this year – this is an increase from 78% of respondents in 2023 and 64% in 2022.

While more individuals want to get away, the risks they face are concurrently rising – for example, climate change challenges to the demand for more extreme adventures and locations.

AllClear noted that city breaks have hit a two-year popularity high this summer too – up from 17% in 2022 to 23% in 2023, peaking at 30% for this summer. The popularity of Airbnb breaks has also increased, from 6% to 15% over two years.

The company’s data further suggests that there has been a big rise in the percentage of people with medical conditions that want a holiday abroad this summer (73%).

This represents a clear rise from 61% of this demographic that wanted a break in June 2023, compared to 58% for the summer of 2022.

The broker explained that the growing confidence of those with medical conditions travelling abroad underscored the need for more people to shop around for the best possible insurance that included comprehensive medical cover.

Its study further indicated that people with medical conditions are more adventurous with their holiday plans this summer, with more opting to travel long haul.

Over the last two years, there have been increases in the percentage of people with medical conditions heading to the USA (5% to 11%), Australia (3% to 6%) northern Europe (7% to 11%) and eastern Europe (4% to 8%).

Garry Nelson, head of corporate affairs at AllClear, said: “Every June before schools break up for summer, we take time to poll the nation on holiday preferences for the peak holiday season.

“After such a challenging time for the sector – enduring a global pandemic and then into a cost of living crisis – it is welcome news to see such a bounce back for the travel industry.

“Overall, city breaks are the big net gainers over the last 12 months and there is also a notable rise in the percentage of people with medical conditions travelling further afield. This underscores the need for holidaymakers to get the best possible cover.

“In recent years, we have noted a growing trend among older holidaymakers – and those with medical conditions – to economise on their travel cover in order to get a cheaper policy. We encourage everyone to get the best possible cover, to ensure no one is inadvertently putting themselves at risk when abroad this summer.”

AllClear’s research found that 66% of people over the age of 55 are happy to cut corners to have a cheaper holiday. One in five would opt for the cheapest available insurance and 6% would travel with no insurance at all.

Of its respondents aged over 55, more than half (54%) are prepared to spend more on travel insurance that covers their medical conditions to ensure their safety – unfortunately, this is down from 64% in 2022 and 2023.

Concerningly, when asked to disclose their medical conditions before taking out travel insurance, only 33% of people over 55 said they would declare everything they are currently suffering from. Just 27% agreed they would disclose their previous medical conditions.

Climate concerns

For travel underwriters, there are additional concerns when it comes to insuring holidaymakers today – particularly around the impact of climate change on temperatures, as well as the risks of travelling to areas which have been without rainfall for weeks or months.

Suzzane Caine, travel claims expert and customer services manager at Aviva, told Insurance Times: “As we approach summer, the nature of claims can change, with fluctuating weather patterns having an impact on holidays and people’s ability to travel.

“Things like wildfires and heatwaves are becoming more commonplace across the globe, which is why we strongly advise customers to take out cover as soon as they book their trip.

“If, as a result of [a] heatwave, you were to fall ill abroad, your travel insurance would cover medical treatment as well as the cost of getting you home if medically necessary.

“In this scenario, travel insurance would also cover any unrecoverable costs relating to your unused travel and accommodation.

“In some areas of Europe, we’re also seeing wildfires due to the extreme temperatures. If you have booked your accommodation independently and it is made uninhabitable by fires, we would cover the costs to relocate [holidaymakers] to alternative accommodation. If you booked as part of a package, however, you would need to contact your tour operator.

“In addition, the volume of travellers during the summer months and industrial action may cause disruption to travel plans.”

Medical costs

Caine noted that there is also a seasonal “change in the type of claims we receive from a medical assistance point of view”, which insurers need to consider.

She continued: “During winter, we experience claims for broken bones and slips [or] falls due to the conditions and people going on winter ski holidays.

“In summer, we see more claims for infections and fever – which is largely seasonal and due to people travelling to certain parts of the world at certain times of the year.

“We also receive more claims involving children during the school summer holidays.”

Aviva warned that the cost of medical treatment is on the increase too – for travellers who fall ill on holiday without the appropriate cover in place, the financial implications could be significant.

In June 2024, the underwriter examined medical assistance claims over the last five years that were submitted during the summer holidays. It found that infections and fevers – such as chickenpox or infected insect bites – were the most common medical claims, costing on average £1,929 across all destination countries.

Though slightly less common, respiratory claims – which include claims for bronchitis and Covid-19 – rank as the most expensive, costing £2,261 on average.

Despite the high costs, Aviva found that 22% of Brits are not sure whether to take out travel insurance, with a further 14% admitting to never purchasing cover.

Kelly Whittington, travel claims director at Aviva, explained: “With medical bills running into the thousands – if not tens of thousands of pounds in more serious scenarios – it’s worrying to learn that millions of Brits are potentially travelling abroad unprotected.

“Although cancellation is the most common travel claim, it’s just as important to remember that travel insurance is designed to help you in the case of an unforeseen events – which includes medical emergencies.

“From ear infections [that] prevent you from travelling home on time to more serious instances, like cardiac treatment or a serious head injury, travel cover is there to protect travellers while they’re away from home, making sure they aren’t out of pocket as a result.

“Taking out travel insurance as soon as you book your trip will give you peace of mind knowing that you are protected, both in the lead up to your trip and while you’re away – hopefully – soaking up the sun.”