The travel industry is expected to return to pre-pandemic levels in 2023. Airline prices may have increased but after two years of itchy feet, millions are planning to fly regardless of the cost. We sat down with Scott Newland to discuss what this means for the insurance industry and the opportunities on the horizon.
Taking off in 2023: What’s next for travel
The travel industry is expected to return to pre-pandemic levels in 2023. Airline prices may have increased but after two years of itchy feet, millions are planning to fly regardless of the cost. The travel and tourism industry’s GDP will reach $8.35 trillion this year and is expected to hit $9.6 trillion in 2023. We sat down with Scott Newland, General Manager, Government and Long-Tail Claims, to discuss what this means for the insurance industry and the opportunities on the horizon.
As the world transitions to post-pandemic in 2023, what will travel look like?
The World Travel and Tourism Council (WTTC) has recently stated that global travel and tourism sectors are expected to return to the pre-pandemic state in 2023 and ramp beyond historic levels, which is a much-needed boost for the tourism sectors, destinations and local economies that rely on tourism.
With travel expected to return to the pre-pandemic level in 2023, what will this mean for insurance companies?
The return of volumes of new policies and claims to pre-pandemic levels means increased resources and support requirements are needed to be in place by insurers to service the ramp-up and meet the demand. Additionally, training, up-skilling and increased quality and compliance requirements are needed from insurers and their agents to ensure improved customer outcomes and experience.
What opportunity does this offer to insurance companies in 2023?
Over the period of forced hibernation, a number of insurers have taken this as an opportunity to review their products, services and cover afforded in travel. This has allowed some insurers to introduce cover for COVID-19 and a number now include cancellations to their travel insurance cover. The product design and risk appetite offer exciting opportunities for insurance companies to service existing customers in new ways or attract new customers to their brand. It is expected both corporate and leisure travel will continue to ramp above pre-pandemic levels providing commercial growth opportunities.
What are some key points for insurance companies looking to expand their product lines into travel?
For insurance companies seeking to expand their product lines into travel, there are a number of regulatory changes that have occurred throughout the pandemic period which have been part of the federal government’s response to the Financial Services Royal Commission. These key points are detailed below:
- Product design and distribution obligations
- Duty not to make a misrepresentation
- Breach of reporting obligations
- Unfair contract terms
- Claims handling as a financial service
How can partnering with Gallagher Bassett help insurers take advantage of travel growth opportunities in 2023?
Gallagher Bassett has over two decades of managing claims in Australia and meets all requirements for claims handling as a service. Gallagher Bassett has a dedicated division that can support any insurer with their claims management and/or policy administration needs, all with a strong track record of improving outcomes.
Contact me today to see how your business can capitalise on the travel industry surge in 2023.