According to a recent report published by Allied Market Research, titled, “Travel Insurance Market By Coverage Type, Distribution Channel, and End User: Global Opportunity Analysis and Industry Forecast, 2021–2030”, the global travel insurance market size was valued at $12.38 billion in 2020, and is projected to reach $119.31 billion by 2030, growing at a CAGR of 26.1% from 2021 to 2030.
The travel insurance market is expected to rise due to increasing demand for safer travel and tourism as the fear of the COVID-19 subsides. The travel insurance market is also being aided by local government policies that are favoring its growth. For instance, Turkey Tourism Promotion and Development Agency (TGA) in June 2021, mandated the tourist destinations in the country to provide their customers (tourists) with proper health safety measures and sanitary environments. This is influencing tourist destinations to include travel insurance plans with their regular charges to better prepare them for the COVID-19 outbreak. Such trends are expected to provide lucrative opportunities for market expansion during the forecast period.
Furthermore, the key factor that drives the travel insurance market growth is rising tourism demands and the ease in pandemic-driven lockdowns that are providing some great opportunities for the growth of the travel insurance industry. In addition, government-mandated travel policies are further fueling the growth of the travel insurance market during the period. However, the low penetration of insurance policies limits the growth of the market. Conversely, new technological developments for the travel industries are expected to provide numerous opportunities for the expansion of the travel insurance industry during the forecast period.
On the basis of end user, the family travelers segment dominated the overall travel insurance market in 2020, and is expected to continue this trend during the forecast period. This is attributed to family travelers having multiple members of different age groups and may require more planning and risk mitigation which is aiding in the adoption of travel insurance among family travelers segments. However, the business travelers segment is expected to witness the highest growth during the period, as business travelers commuting on amidst the pandemic may require insurance covers to compensate for delays and cancellations during the period of the pandemic.
Region wise, the global market was dominated by Europe in 2020 and is expected to climb to the highest position during the forecast period, owing to rising tourism trends within the European region and the health safety and hygiene demands in the region, is aiding the growth of the market. However, Asia-Pacific is expected to witness significant growth during the forecast period, owing to the growth of multiple industries in the Asia-Pacific region which is promoting business-related travel and the growing tourism industry of the region is aiding the growth of the travel insurance market trends in this region.
Post the reign of the COVID-19 pandemic which forced many people to remain in their homes and self-isolate, leading to the cancellation of their vacation and outdoor plans, as lockdown protocols are being eased in many parts of the world, the travel and tourism industry is seeing an upward trend in the number of tourists. For instance, as of January 28, 2022, the number of travelers crossing the U.S.’s Transportation Security Administration (TSA) checkpoints are already higher than both 2021 and 2019. Such positive trends are showcasing the tourism getting back on track post the pandemic, which promises great opportunities for the growth of the market during the forecast period.
Key Findings of the Study
- By coverage type, the annual multi-trip travel insurance segment accounted for the largest travel insurance market share in 2020.
- By region, Europe generated highest revenue in 2020.
- By end user, the family travelers segment generated the highest revenue in 2020.
The key players profiled in the analysis are ALLIANZ, AMERICAN INTERNATIONAL GROUP INC., Assicurazioni Generali S.P.A., AXA, Insure and Go Insurance Services Limited, Seven Corners Inc., Trip Mate Inc., Travel Insured International, Travel Safe Insurance, and USI INSURANCE SERVICES, LLC. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.