2022 Outlook for Travel Insurance Buyers – Forbes Advisor

Editor’s Note: We earn a commission through affiliate links on Forbes Advisor. Commissions do not affect the opinions or ratings of our editors.

Just as travel restrictions were finally being relaxed and travelers were starting to get excited, Omicron crashed the party. News of the Covid variant led to border closings, new travel warnings and quarantines, suggesting the pandemic will change the way we travel for some time to come.

Fortunately, many of the changes we can expect to see in the travel insurance industry this year – and beyond – are aimed at alleviating the travel problems of the pandemic.

Since the beginning of the pandemic, travelers have been buying more protection for trip cancellations and the industry is looking to cover Covid-related issues and moving towards more flexibility and transparency.

Many travelers are eager to book trips for 2022 and are adding insurance to their plans. According to Squaremouth, a travel insurance comparison company, travel insurance sales rose 53% in the days immediately following news of the Omicron variant.

Here are some of the travel insurance trends you can expect in 2022.

Compare and buy travel insurance

Travel cancellation insurance will continue to gain momentum

The cancellation insurance will reimburse you for prepaid, non-refundable down payments if you cancel for a reason listed in your policy, e.g. B. Illness or family emergency.

Travel cancellation insurance has always been a popular part of travel insurance. According to Squaremouth, it was part of 80 to 90% of travel insurance policies.

As the pandemic continues to affect travel, this trend shows no signs of slowing. Sales of travel insurance with cancellation insurance increased 255% year over year, Squaremouth says.

“Cancel for any reason” reporting will keep the momentum going

The “Cancel For Any Reason” (CFAR) insurance is an upgrade available on some policies that expands your options for making a trip cancellation claim. If you have CFAR insurance, you can cancel for any reason not listed in the base policy and still get a refund on your lost deposits – often 75%.

CFAR is superior coverage for unsafe travel times as it can apply to situations that are not normally covered by basic travel insurance. For example, you might be filing a CFAR application because of a border closure or because you don’t like the Covid testing or quarantine requirements of your travel destination.

“Cancel for any reason” coverage has gained momentum during the pandemic and remains popular with travelers. Sales of this coverage increased 147% between 2020 and 2021, according to Squaremouth.

Plans)

Preferred & Deluxe

Maximum CFAR reimbursement

50% or 75%

Maximum dollar reimbursement

$ 75,000 or $ 112,500

Plans)

Worldwide Trip Protector Plus

Maximum CFAR reimbursement

75%

Maximum dollar reimbursement

$ 75,000

Maximum CFAR reimbursement

75%

Maximum dollar reimbursement

$ 75,000

Covid reporting is becoming more common

After a few years of the pandemic, many travel insurance companies are now including Covid-related coverage as part of standard travel health insurance and travel cancellation insurance.

“The majority of providers now cover Covid under travel expenses and cancellations and in most cases consider it like any other illness,” said Megan Moncrief, spokeswoman for Squaremouth.

Travel health insurance covers the cost of an ambulance, medical treatment, medication, and more if you get sick or injured during your trip. There are a variety of levels of coverage, with some policies offering up to $ 500,000 in medical coverage per person.

If Covid coverage is important to you, make sure your policy includes travel cancellation and medical benefits.

Check out Forbes Advisor’s reviews of the best travel insurance plans for pandemics.

Advantages in the event of travel delay take precedence

While trip cancellation remains a major concern for travelers, travel delay benefits are becoming increasingly popular as concerns about new options and quarantines mount, Moncrief says.

“As variants come into play, concerns of contracting the virus and being forced to quarantine while traveling are now beginning to take the lead over concerns about cancellation,” Moncrief said. “We assume that interest in travel delay cover will increase in 2022.”

Travel insurance can, under certain conditions, reimburse you for meals, an extended hotel stay and other additional costs if you have to be quarantined during your trip: You must test positive for Covid and you must have a plan that covers Covid-related expenses. The benefits can usually be extended by seven days beyond the return date if you have to be in quarantine at your destination for longer than planned.

As a rule, travel insurance does not pay if you do not have a Covid but have to do a mandatory quarantine somewhere.

More flexibility in travel insurance

Some travel insurance companies will now accommodate customer requests for changes to the travel dates in the policies. This allows you to postpone the trip – and your travel insurance coverage – without having to cancel and buy new insurance.

Additionally, according to Moncrief, many travel insurance companies are still willing to waive penalties for canceled or modified trips, so you can potentially reimburse travel expenses that would otherwise have been lost.

Further benefit options on deck

To better serve the needs of travelers during the pandemic, travel insurance is backing up certain benefits that are expected to continue.

For example, some countries require visitors to have a certain minimum amount of travel insurance coverage. Costa Rica, one of the most popular travel destinations last year, mandates that unvaccinated visitors get $ 50,000 health insurance and $ 2,000 travel delay to pay for quarantine-related accommodations.

Many of the travel insurance companies that didn’t offer these levels of coverage have revised their plans to meet the required limits, Moncrief says.

“I expect we’ll see that kind of response in 2022 as long as these kinds of mandates are in place,” she says. “We can even see that if the trip is delayed, benefits are extended from seven to 10 days after the policy end date.”

Benefits for emerging pandemic problems

As new pandemic-related travel concerns emerge, the travel insurance industry appears to be reacting.

For example, some insurers are considering adding coverage for border closures and travel warnings after Omicron, Moncrief says, although it will take time to get approval in each state and work out the pricing details.

“It’s like terrorism. Had no politics [terrorism coverage] before 9/11 and now it is explicitly listed and covered in most cancellation policies, ”she says.

Foreign travel is popular despite new entry regulations

It is becoming “normal” for travelers to be required to present a combination of proof of vaccination and a negative test result or proof or recovery from Covid when entering other countries and returning to the USA

In January 2021, the Centers for Disease Control issued a new regulation according to which all international passengers arriving in the USA must be tested for Covid at least three days before their departure. (It was recently changed to the day before.) You must show a negative result or evidence that you have recovered from Covid in the last 90 days before boarding.

Despite the pandemic and various entry requirements, more than 80% of bookings were made for international destinations in 2021, according to Squaremouth.

However, European travel destinations are not reaching the level of popularity they had before the pandemic, Moncrief says. “Even with the borders opening, I think people are still waiting,” she says. “And the Caribbean and Mexico are still more popular than they were before the pandemic.”

Younger travelers lead the pack

Older travelers are still staying close to their home as younger travelers brave the travel turmoil from Covid.

Before the pandemic, most travel insurance was taken out by people over 50. It changes. According to Squaremouth, the majority of travel insurance is taken out by those under the age of 50.

“Older people are currently uncomfortable with the potential travel risk, and younger people are more inclined to go,” says Moncrief. “We assume that the trend of younger people, millennials, Generation X and baby boomers will continue with similar market shares in 2022.”

After 2022: Policy language must be clarified

Some travel insurance companies are likely to start revising the language in their policies to better reflect the new reality of living – and travel – in a pandemic world.

A policy may include certain travel insurance benefits that are applicable to Covid, such as: B. travel health insurance while others do not. But it’s not always written out.

Travel insurance companies have added information on Covid-related topics on their websites to fill the information gap.

Adding explicit language to the guidelines for Covid-related issues will take some time as state insurance departments need to approve changes, but Moncrief believes insurers will make progress in clarifying the terms that are covered in 2022 and what not.

Compare and buy travel insurance for 2022

Compare offers with over 22 travel insurers

Comments are closed.