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The European travel insurance market is dominated by comprehensive coverage, driven by informed consumers seeking extensive protection. The rise in online purchasing, senior travelers, and the pandemic’s impact have solidified the demand for all-inclusive policies that cater to diverse traveler needs.
New Delhi, May 23, 2024 (GLOBE NEWSWIRE) — The Europe travel insurance market is experiencing robust growth, with a valuation of US$ 2.5 billion in 2023, projected to soar to US$ 15.0 billion by 2032, at a CAGR of 22.1% from 2024 to 2032.
Consumer behavior in Europe indicates a strong preference for travel insurance, with 77% of Brits having purchased it in the past and 48% consistently doing so for trips abroad. In line with this, the UK market alone is expected to grow from £468 million to £598 million by 2029. This growth is fueled by a combination of factors, including mandatory insurance regulations for visa applications, increased consumer awareness, and the impact of the COVID-19 pandemic, which has underscored the importance of travel insurance.
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Medical cover is the most sought-after, accounting for 54.2% of the travel insurance market in 2023. The majority of the market is dominated by individual insurance plans (77.0%) and comprehensive travel trip insurance (52.6%).
The pandemic has not only heightened the demand for travel insurance but also accelerated the Travel market’s digital transformation, leading to more interactive and efficient digital platforms. European governments have played a significant role in this demand by enforcing regulations that make travel insurance mandatory for travelers. Additionally, partnerships between insurers and travel-related businesses have become more common, offering insurance at the point of booking.
In terms of claims, UK travel insurers paid out £352 million in 2022, with the average claim reaching £973, the highest since 2004. The most common claims were for trip cancellations and lost belongings. Customer satisfaction is at an all-time high, with 87% of policyholders satisfied with their coverage.
The Europe travel insurance market is competitive, with major players like Zurich, Allianz, and AXA leading the way. The insurance intermediaries’ sector is particularly dominant. Coverage typically includes emergency medical expenses, trip interruptions, cancellations, lost baggage, and more, with policies costing between 4% to 8% of the total trip cost. While travel insurance is deemed valuable for managing travel risks, especially for longer and nonrefundable trips, it may be less necessary for shorter, inexpensive, or fully refundable trips.
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Key Findings in Europe Travel Insurance Market
Market Forecast (2032)
US$ 15.0 Billion
CAGR
22.1%
By Risk Coverage
Medical Cover (54.2%)
By Trip Type
Comprehensive Travel Trip (52.6%)
By Type
Individual Insurance (77.0%)
By Destination
Domestic (57.2%)
By Distribution Channel
Insurance Aggregators (53.3%)
By End Users
Travelers (81.5%)
Top Trends
Top Drivers
Heightened consumer awareness and education about travel insurance
Positive impact of COVID-19 pandemic on travel insurance
Schengen visa insurance mandates
Top Challenges
Digital Innovations and Partnerships in Europe Travel Insurance Market
The market is adapting to new technologies, with a shift towards digital platforms and products. Partnerships between insurance providers and travel-related businesses are becoming more common, such as Chubb’s partnership with Royal Brunei Airlines and AXA Partners’ collaboration with Trip.com. These partnerships often include comprehensive coverage options, catering to the evolving needs of travelers.
The Symbiotic Relationship: Tourism Drives Europe’s Travel Insurance Market
The symbiotic relationship between tourism and the travel insurance market in Europe is evident through the substantial economic contributions and growth patterns observed in recent years. Tourism stands as a pivotal economic pillar for Europe, having generated a staggering USD 1,920 billion for the continent’s GDP in 2023. This economic influx is not just a testament to the continent’s allure but also a driver for ancillary markets, including travel insurance. Europe’s status as the world’s premier travel destination, drawing in over 50% of all global international visitors, has a direct and profound impact on the demand for travel insurance products.
Countries like Germany and France, which are among the top destinations within Europe, have seen their markets flourish in tandem with their tourism sectors. Germany’s travel insurance market is on a trajectory to more than triple by 2030. Similarly, France is witnessing a steady climb in its travel insurance premiums. These figures underscore the correlation between the influx of tourists and the heightened need for travel insurance, as travelers seek to safeguard their trips against uncertainties.
The consumer behavior within the European travel market further reinforces the demand for travel insurance. A significant number of European travelers are proactively securing travel insurance to mitigate common travel-related risks such as airline cancellations, luggage loss, and medical emergencies. The preference for single-trip insurance coverage, which captured the largest revenue share at 60.1% in 2023, reflects the demand among occasional travelers who may not travel frequently but still recognize the importance of insurance for specific trips.
The Preeminence of Medical Coverage in European Travel Insurance Market Captures Over 54.2% Market Share
In the landscape of European travel insurance, medical coverage has emerged as the predominant force, accounting for a substantial 54.2% of the market in 2023. This segment’s dominance is largely attributable to the inadequacy of domestic health insurance policies outside national borders, necessitating a specialized travel medical insurance to bridge the gap. Such insurance is crucial, as medical emergencies can arise suddenly, and the associated costs can be staggering, potentially derailing one’s travel budget. Unlike standard health insurance, travel medical insurance is tailored to address the risks and challenges faced when traveling.
The Schengen Area’s visa requirements further underscore the importance of this insurance type in Europe travel insurance market. For stays beyond 90 days, travelers must possess travel medical insurance that meets certain criteria, ensuring they are covered for emergencies. The cost of travel insurance for Europe hovers around $359 on average, with a range of $40 to $80 for most policies, making it a relatively affordable safeguard. Stand-alone medical policies average $92.75 per trip, with the price influenced by various factors such as age, trip length, destination, and coverage extent.
The necessity of medical coverage is further illustrated by real-world costs; for instance, a traveler without evacuation insurance incurred a $70,000 bill to return from Spain to the U.S. Such examples highlight the financial risks of traveling without adequate coverage. With European vacation costs increasing by 30% from 2022 to 2024, and countries like the UK, Germany, and France contributing significantly to tourist numbers in destinations like Spain, the value of comprehensive travel medical insurance becomes indisputable. It’s not just a matter of compliance with visa regulations but a critical investment in one’s well-being while exploring the world.
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Comprehensive Coverage is the Undisputed Champion of European Travel Insurance Market with Over 52.6% Market Share
In the dynamic landscape of European travel, comprehensive travel insurance has emerged as the dominant choice among consumers, a trend underscored by compelling statistics and market behavior. A paramount concern for 85% of European travelers is health and safety, a priority that comprehensive insurance addresses by offering extensive medical coverage, a necessity given that medical costs abroad can be triple those at home, according to the World Health Organization. The robustness of comprehensive plans is further justified as trip cancellation, which forms up to 40% of insurance claims, and the protection against the mishandling of 24.1 million bags globally, are covered under such policies.
The surge in consumer education has also played a pivotal role in the growth f the travel insurance market, with 72% of travelers now more informed about insurance than five years ago. This awareness, coupled with the influence of government travel advisories, which affect 60% of travelers’ insurance purchasing decisions, and Schengen visa insurance mandates, has led to a more discerning clientele. The convenience of online purchasing, with 65% of insurance now bought through digital channels, has made comprehensive coverage more accessible and customizable, as seen with insurers like AXA.
The rise in adventure tourism, with 30% of European travelers participating in such activities, and the projected growth in business travel, further fuel the demand for comprehensive plans. Notably, the senior traveler segment, which heavily favors comprehensive insurance for enhanced health and trip cancellation coverage, has seen a 70% preference rate. Frequent travelers are also contributing to the trend, with a 20% increase in multi-trip policy sales.
The COVID-19 pandemic’s impact on travel has only solidified the position of comprehensive insurance in the Europe’s travel insurance market, as travelers seek protection against health risks and trip interruptions due to quarantine measures. Trust in comprehensive coverage is high, with 80% of consumers favoring trusted brands, and insurers like Allianz and Generali expanding their offerings to meet this demand. The inclusion of 24/7 assistance services, valued by 75% of travelers, and the 25% increase in uptake of family travel policies, underscore the all-encompassing appeal of comprehensive plans. Influential travel agents recommend these policies to over half of their clients, leading to a 10% higher customer satisfaction and retention rate for insurers.
Europe Travel Insurance Market Key Players
Key Segmentation:
By Medical Cover
Emergency Accidental Treatment & Evacuation
Emergency Medical Treatment & Evacuation
Personal Accident
Daily Cash Allowance
Accidental Death & Disability
Emergency Dental Treatment
By Risk Coverage
Smooth Transit Covers
Flexible Trip
Others
By Trip Type
Comprehensive Travel
Student Travel
Leisure Travel
By Type
Individual Insurance
Group Insurance
Single Trip Insurance
Multi Trip Insurance
By Destination
By Distribution Channel
Insurance Intermediaries
Insurance Companies
Banks
Insurance Brokers
Insurance Aggregators
By End User
Students
Travelers
Travel Bloggers
Tourist Guides
Family Travelers
Business Travelers
Group Travelers
Senior Citizens
Others
By Country
Germany
UK
France
Italy
Spain
Netherlands
Hungary
Switzerland
Russia
Poland
Austria
Slovakia
Czech Republic
Croatia
Slovenia
Romania
Bulgaria
Rest of Europe
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Publish date : 2024-05-23 07:00:00
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