The UAE is witnessing a hike in travel insurance policies amid a surge in international travel, with travel insurance firms reporting significant rise in demand this year.
The rising demand pick-up in travel insurance policies in the Gulf country is in line with the current global market trend for the travel cover product, which is projected to reach $119.31 billion by 2030.
Policybazaar, which deals with travel insurances, said the company saw a 150 percent increase in sale of travel insurance policies in the April-June quarter of 2022 over the first quarter of this year in the UAE market.
The company said there has also been a significant rise in demand for travel insurance in FY 21-22 in the UAE.
The company saw a rise in demand from top tourist destinations such as the USA, Schengen countries, Indonesia and the UK.
A majority of these countries have made travel insurance mandatory along with other valid travel documents.
The surging demand for travel insurance policies comes amidst the mounting labour troubles at some of the busiest airports such Heathrow and few other airports in Europe, leading to large-scale flight cancellations and long flight delays.
Increasing incidents of lost and missing luggage are another major reason driving up demand for travel insurance.
Travel insurance companies provide coverage for baggage delay as well as baggage loss.
Travel insurance policy also compensates travellers from undue expenses in situations of a medical emergency, personal liability or other emergencies.
“One thing the pandemic has taught us is to take necessary precautions and we will see a rise in travel insurance especially for Covid or unexpected medical costs, loss or delay of baggage,” said Neeraj Gupta, chief executive officer of Policybazaar.ae.
He said baggage coverage was a very important benefit within travel insurance plans, as it could provide monetary assistance when things go wrong with one’s luggage during a trip.
Delaying or losing check-in baggage is one of the most common adversities faced by travellers.
Nearly 220,000 bags were ‘mishandled’ by US airlines in April 2022 – meaning they were lost, damaged, delayed or stolen – according to the recent data published by the US Department of Transportation.
The global travel insurance policy market was valued at $12.38 billion in 2020.
The market is predicted to grow at a compounded annual growth rate (CAGR) of 26.1 percent from 2021 to 2030.
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