United Kingdom (UK) Travel Insurance Market Size, Trends, Competitor Dynamics and Opportunities
Summary
The UK travel insurance market is recovering after being hit extremely hard by COVID-19, with gross written premiums (GWP) declining by 30.1% in 2021. In 2021, the average premium for single-trip policies was more expensive than multi-trip for the first time since 2015. We forecast GWP to rise by 37.8% to GBP492 million in 2022; however, this will remain well below the GBP624 million recorded in pre-pandemic 2019. Future growth in the travel insurance market will to some extent be a recovery from losses inflicted by the pandemic, as well as being partly driven by consumers being more cautious when traveling abroad. As a result, we expect the penetration rate of travelers purchasing insurance to rise.
This report analyzes the UK travel insurance market, including drivers of uptake. It examines the claims landscape in 2021, as well as upcoming regulatory changes within the insurance space. Incumbent competitors are analyzed and compared, along with newcomers and insurtechs. The report also examines future impacts in the market, including inflation as well as emerging technologies such as artificial intelligence and blockchain.
Scope
- UK travel insurance GWP is set to record a compound annual growth rate (CAGR) of 7.1% to reach GBP503.1 million by 2026f.
- Claims declined by 57.4% in 2021 as fewer people traveled, falling to GBP106.5 million as a result. This figure is expected to increase significantly in 2022 as consumers look for more comprehensive policies, which means consumers will be covered for more potential risks.
- The pandemic has driven an increase in staycations, which looks set to continue as a result of the cost-of-living crisis. While individuals can now travel abroad, doing so is not always straightforward. This means insurers will need to reach out to people traveling within the UK and demonstrate that travel insurance can still be worthwhile.
- Examine the size of the travel insurance market
- Identify who the key players are and what products they offer
- Discover GlobalData’s forecasts for the future of the travel insurance market
- Learn how COVID-19 has impacted travel insurance
- Discover the impact that the cost-of-living crisis will have on the travel space
- Executive Summary
- Market overview
- Key findings
- Critical success factors
- Market Dynamics
- The UK travel insurance market contracted to a record low in 2021
- Table Figure 1: The UK travel insurance market contracted by 30.1% in 2021
- Table UK travel insurance market GWP and annual growth rate, 2017–21
- The number of single-trip policies written experienced the greatest contraction in 2021
- Table UK travel insurance policies written and annual growth rate, 2017–21
- Table Figure 2: The number of written policies continued to fall in 2021
- Multi-trip policies accounted for 90.0% of the market in 2021
- Table Figure 3: Multi-trip policies remain the travel insurance market leader
- The average single-trip premium rose by 77.0% owing to an increased number of claims
- Table Average premiums and percentage change by policy type, 2017–21
- Table Figure 4: Multi-trip policy average premiums recorded a CAGR of 3.8% between 2017 and 2021
- Premiums decreased across most age groups in 2021
- Table Average premiums and percentage change by age group, 2019–21
- The FCA has introduced mandatory travel insurance signposting rules
- The number of travel insurance claims fell by 69.5% in 2021
- Table Figure 5: The number of claims decreased by 69.5% in 2021
- Table Figure 6: Cancellations accounted for 50.0% of travel insurance claims in 2021
- The cost of claims fell by 57.4% in 2021
- Table Figure 7: The cost of claims plummeted in 2021
- The average value of claims paid increased by 40% in 2021
- Table Figure 8: The average value of medical expense claims rose by 6.3% in 2021
- Travel insurance complaints increased, partly due to a lack of understanding around coverage
- Fewer consumers traveled abroad in 2021
- Table Number of visits abroad by region (000s), 2017–21
- Table Figure 9: Outbound tourism decreased in 2021 for all regions
- Table Number of trips abroad by purpose of travel, 2017–21
- Table Figure 10: The proportion of trips accounted for by visiting friends and relatives has increased sharply, while the number of holiday trips has fallen
- The impact of economic, sociopolitical, and health events on travel
- Table Figure 11: The unemployment rate fell to 3.8% in Q2 2022
- Table Figure 12: Real weekly earnings continue to fall in 2022 as inflation becomes more severe
- A lower exchange rate will make travel more expensive for UK citizens
- Table Figure 13: The pound hit an all-time low against the dollar in Q3 2022
- The cost-of-living crisis will impact travel habits
- Table Figure 14: Consumer price inflation will peak in 2022
- Despite Brexit, UK citizens will still be able to access medical care in the EU
- Insurers must target domestic holidaymakers more effectively
- Table Figure 15: Most individuals would not consider purchasing travel insurance for domestic travel
- The UK travel insurance market contracted to a record low in 2021
- The Structure of the UK Travel Insurance Market
- Munich Re is the largest underwriter in the market by premiums
- Table Figure 16: Great Lakes Munich Re remains the leading underwriter by travel insurance premiums
- U K Insurance underwrote the highest number of policies
- Table Figure 17: U K Insurance underwrote the largest share of contracts sold in 2021
- Nationwide sold the largest number of travel insurance policies
- Table Nationwide FlexPlus travel insurance coverage, 2021
- Table Staysure annual comprehensive coverage, 2021
- Table Admiral's annual coverage, 2021
- Chubb launched Pay As You Roam travel insurance
- Travel insurers included specific COVID-19 features for new travel policies in 2021
- Embedded insurance can benefit the travel insurance industry
- The trend towards digitalization has been accelerated by the COVID-19 pandemic
- Munich Re is the largest underwriter in the market by premiums
- The Market Going Forward
- The travel insurance market is set to recover to reach GBP503.1 million by 2026f
- Table Figure 18: Travel insurance is set to recover in 2022 after the sharp 2021 decline
- Technological opportunities in the market
- AI can help prevent fraudulent claims
- The travel insurance market is set to recover to reach GBP503.1 million by 2026f
- Appendix
- Abbreviations and acronyms
- Methodology
- Table Figure 19: Forecasting methodology
- Secondary sources
- Further reading
- About GlobalData
- Contact Us
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