Ancillary Insurance
Analysis of Insurance Bought, Not Sold
In 2019, we published a report titled Travel Insurance Under the Influence, highlighting the projected growth of the travel insurance market to $35 billion globally and $8 billion in the US by 2025. This growth, driven by increased global tourism and a shift from physical travel agents to online platforms, raised questions about who might be left behind.
In 2016, Americans spent nearly $2.8 billion on travel protection, a 19.1% increase from 2014. Most travel protection plans are purchased at the point of sale (POS), with minimal online searches for comparison. By 2023, Americans spent nearly $4.8 billion on various travel protection services, with online channels accounting for more than half of this expenditure. Modern travel insurance features easy and fast online purchasing processes, often embedded within other services. While consumption may vary, the convenience of purchasing travel insurance remains a constant advantage. Consumer-facing brands from various sectors, such as airlines, fintech, online travel agencies (OTAs), and telecom companies, continue to act as travel insurance distributors. They form partnerships with established insurers and/or MGAs to offer insurance products at the POS.
In 2021, we published another report titled Travel Insurance As The New Norm, where we examined how technology and strategy have evolved to better serve today’s traveler. As the world was reopening, “revenge travel”—the desire to travel after extended lockdowns—emerged, with a growing interest in travel insurance.
The trends from then remain relevant today:
- Embedded Insurance: Airlines, fintechs, and other sectors are offering embedded travel insurance at checkout, often focusing on trip cancellation and medical coverage.
- Modern Insurance: Select insurers are enhancing convenience, fairness, flexibility, and functionality with features like automated claim payments and travel concierge services.
- Insurtechs & Travel Insurance: New pure-play travel insurance startups are rare, but we’ve included insights from Faye and battleface.
Overall, this report builds on previous ones, focusing on the purchasing journey of travel insurance and other ancillary products.
For older reports click here.