UAE: Demand for travel insurance on the rise as more people take leisure, business trips

Demand for travel insurance in the UAE is set to double as passengers have become more cautious and aware in the post-pandemic period, as well as the requirement of countries to have insurance prior to submitting visas.

Industry executives noted that the cost of travel insurance is, for the most part, remaining stagnant this year.

“Though Covid-19 is behind us, people are still cautious that things can go wrong while they are travelling. A lot of people who were not very keen to buy travel insurance earlier, now consider travel insurance to be an important aspect of their journey as they have become more aware of the risks associated with cancellation, financial and emotional risks. Secondly, the number of people travelling has increased as well,” said Neeraj Gupta, CEO, Policybazaar.ae.

“We are seeing a 65 per cent increase in travel insurance demand year-on-year and 40-45 per cent on a month-on-month basis,” he added.

The UAE’s travel sector has bounced back strongly, lifting demand for travel insurance as well ticket prices. As a result of revenge travel, demand for leisure and business trips has grown exponentially.

Gupta added that the majority of consumers buy insurance due to concerns surrounding trip cancellations, sickness, the fear of baggage loss, and the fear of falling ill abroad during the trip.

Although the majority of packages cover Covid-19, customers still make inquiries to ensure that they cover the pandemic. “Most people still ask whether the plan covers Covid-19 or not.”

Hitesh Motwani, chief marketing officer, Insurancemarket.ae, added that travel insurance demand usually doubles during the summer, as many residents visiting Europe opt for coverage required in accordance with Schengen visa regulations.

“[The] primary reason for UAE residents opting for travel insurance now is due to visa regulations. Almost all the countries, especially those in Europe, require it as part of the visa process,” he said.

Cost stays stagnant

Motwani stated that travel insurance costs have remained stagnant over the past couple of years.

“In fact, they have reduced by around 10 per cent over the last year, especially since Covid-19 cases are down. Earlier in 2021, since the Covid-19 cover was introduced, the average premiums saw an increase, but it has come down since then,” he added.

Gupta added that there is not much change in terms of the cost of travel insurance this year.

“For example, travel insurance cost to a 4-5 day Georgia trip costs around Dh60-70 and Dh150 to the UK for a 10-15 day tour,” he added.

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