Trip Insurance Gets Easier to Book
by Barbara PetersonTrip protection is getting easier for travel agents and their clients to manage, say major travel insurance providers, with new tools and technology upgrades that are designed to streamline the process.
Services like automatic claims payment and paperless processing are helping to widen the appeal for insurance products. Company executives participating in the recent Phocuswright Travel Innovation Summit in Fort Lauderdale said this reflects a changing demographic as well, with more Millennials getting comfortable with the notion they should buy trip insurance.
“Millennials are the largest population of working people,” said Philip Hsia, president of AIG Travel Americas, parent of Travel Guard insurance. “But when you are younger, you don’t think anything bad is ever going to happen to you.”
That sense of immortality is nothing new, of course, but data show that younger travelers are increasingly buying insurance, given the growing popularity of adventure trips and itineraries involving riskier destinations, Hsia said in an interview.
Another factor may be that Millennials are using travel agents in higher numbers, again, debunking the DIY stereotype of this generation. “The difference is there are more Millennials working as travel agents and in the travel business,” and peers can often make a persuasive case for why someone should shell out more money for an ancillary service like trip insurance, Hsia said.
The threat of terrorism is also on the minds of travelers these days, but insurance executives said that’s not the only reason for a surge in interest in insurance. Dean Sivley, CEO of Berkshire Hathaway Travel Protection (BHTP), said “people understand there’s some risk in travel,” but the reasons for wanting to travel are more powerful.
He said that BHTP is offering a slew of new services to appeal to more travelers, among them, a family-friendly product for its traditional trip insurance, Exact Care, that gives free coverage for one child 17 and under for each adult who buys a policy.
Sivley said that ongoing frustration with air travel is helping to raise visibility for its Air Care product, which, for a relatively low price, offers instant payments when a flight gets delayed or canceled. The cost starts at $34 per person for domestic flights; it was recently expanded to cover international flights. And clients can get quick cash when things go wrong via their debit cards, under an agreement with Mastercard, he said.
Roughly 20% of BHTP’s sales come through travel agents, and that percentage is rising, Sively said, with a new agent portal going online this week, with features like an “enhanced InstaQuote” which makes it easier to get a quote online, plus side-by-side quote comparisons and a simplified claims process.
And startup companies are emerging in the sector: one such contender that appeared at Phocuswright is AirHelp, which aims to clear up confusion over the myriad rules governing flight snafus overseas. With a free mobile app, the company takes a passenger’s information following a disruption and files and monitors claims; if successful, it gets 25% of the compensation, which, in the European Union, can be substantial, as consumer protections there are among the tightest in the world.
“What you may not know is that you are entitled to up to 600 euros ($634 US dollars) in compensation if your flight is delayed more than three hours,” said Henrik Zillmer, AirHelp CEO.
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