Statistics about the Travel Insurance Industry

Statistics about the Travel Insurance Industry

Travel insurance is about as interesting as auto insurance, and if you are like most of us, your knowledge and expertise ranges from little to none. Many of us assume that trips will be trouble free and put little effort or time into selecting travel insurance. According to the United States Travel Insurance Association, only about 30% of all passengers purchase travel insurance, a number that went up by 10% after the terrorist attack on the World Trade Center in 2001. When Snowstorm Nemo in February of 2013 resulted in the canceling of 3,700 flights, it reminded us of the wisdom of buying a trip insurance. It is not surprising, therefore, that trip cancellation coverage accounts for 94% of the policies sold in the United States. A lesser known fact is that 12% of all travelers had their trips affected in some way by natural disasters.

So what is happening in the travel insurance game? It is a bit difficult to generalize. For example, in 2006, the average insurance premium sold was $182.91, rising to $238.64 in 2008, dropping to $224.25 in 2009, rising to $266.72 in 2011 and $276.42 in 2012. If you compare data in 2006 to 2012, there has been a 51% increase in the average policy premium. If you only look at the change from 2011 to 2012, it shows a modest 1% rise in premiums. But what do these statistics represent? They represent a percentage calculated on a set of variables. Add another variable and the numbers change. For example, from 2006 to 2012 the average length of a trip dropped from 17.92 to 14.8 days, or a decrease of 21% in the number of days covered. If you express the increase in cost per day, the increase rises to almost 83%. Does this figure present an accurate depiction of the change? Not if you want to factor in the rise in the cost of living, which the SSA calculates at 16.7% since 2006. You begin to get the point? Statistics can be manipulated to prove almost anything.

If you want a general statistic with some value, on average in 2012, travel insurance accounted for 5.5% of total trip expenses for those who bought it. Because costs are higher to some destinations, and every policy can include multiple insurance options, you should compare and buy travel insurance online.

One Comment

  1. Basically travel insurance is designed to protect you against a number of situations, though not all travel insurance plans are the same. Some will cover things such as theft whilst others will cover accident or illness. So it is important that you know exactly what your insurance covers if you do get it.

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