By: Jeremy Murchland, Seven Corners President
The COVID-19 pandemic has impacted nearly every aspect of people’s lives, and travel is no exception. In fact, the travel industry may have been one of the most affected areas, as travel plans were changed, postponed, or canceled entirely. The year 2020 saw an 80% decrease in travel, both internationally and domestically. While we’ve seen a slight uptick in leisure travel again, business travel is still significantly depressed, and we expect to see that continue into next year.
This year, travelers began to place greater importance on safety, cleanliness, and flexibility when booking travel, as opposed to luxury or comfort. This means that despite the travel industry declining, consumers’ awareness of travel insurance increased. In fact, the instance of travelers purchasing travel insurance for their trips is expected to increase by 50% this year, and that trend should continue into next year.
Because of the pandemic, people are more aware of travel insurance and its benefits in protecting expensive trip costs. I’ve outlined the major changes in travelers’ behaviors and how travelers can stay prepared for the future during this uncertain time.
Travelers’ priorities have changed
As mentioned, people are now more conscious of safety and cleanliness when considering travel plans, and they’re more aware of what their options are. Because of these concerns brought about by COVID-19, people are now booking trips closer to when they’ll leave instead of making plans in advance. For example, now is usually the time we see people begin to start making plans for spring break travel. With travel regulations constantly changing and next spring still unknown for COVID-19 restrictions, people will likely make plans closer to their departure date to ensure there aren’t changes with their trip.
Understand cancellation penalties prior to booking
Travelers are also more mindful of their health and whether or not their trip plans are flexible. If people are traveling out of the country, they now have to consider whether or not they are covered for contracting COVID-19 abroad, and who will help them get home in case of emergency. I encourage travelers to understand what their flexibility options are when they book a trip and ensure that you fully understand the booking terms. If your trip is interrupted or canceled, know what your penalties are. Because of potential penalties, it’s a good idea to consider purchasing travel insurance to protect trip costs.
Consider adding travel insurance
I recommend that people purchase a comprehensive type of travel insurance that covers trip cancellation and interruption as well as injuries and illnesses that occur on a trip. Some plans offer medical only, or if you’re taking a cruise, the plan may only cover the cruise. Make sure you purchase travel insurance that is fully comprehensive and covers all angles of your trip.
It’s also prudent to consider adding Cancel for Any Reason (CFAR) coverage to your insurance plan. CFAR is always going to provide the most flexible options for travelers to cancel a trip for any reason of their choosing. Adding CFAR will provide you a refund of up to 75% of your nonrefundable trip costs. We’ve experienced a large increase in CFAR sales as people continue to be hypersensitive to sudden trip cancellations and interruptions during the pandemic.
Even in a decreased travel market, we’re seeing an increase in travel insurance sales as awareness of travel insurance begins to increase. Prior to the pandemic, people didn’t understand what travel insurance was or why they needed it. Now, they recognize its importance and understand that a travel insurance plan can protect them in the event of an emergency situation.
The future of travel
Of course, the future of the travel market is difficult to predict with the constant changes COVID-19 has brought us. However, we’re expecting a return to leisure travel as we start to move into the summer of next year, with trip bookings expected to take place in March or April. Business travel will still likely be behind as people continue with virtual means of communication.
One thing is certain: people are anxious to return to a sense of normalcy. It’s possible that 2021 could experience a major travel boom, as travelers use their flight credits and finally take those long-awaited trips. Hopefully, they are able to do so safely while protecting their trip costs.
About the Author
Jeremy Murchland is the president of Seven Corners, innovative and service-focused travel insurance and benefit management company that serves a global market. Based in Carmel, Ind., the company offers customized travel insurance solutions and 24/7 emergency medical and travel assistance services for individuals and groups. Seven Corners also administers health care benefits for select U.S. government programs.
Murchland became president of Seven Corners in January of 2020 after serving as the senior vice president of sales and marketing for the company. Murchland has more than 20 years of senior management experience and a long history of building high-performance teams and growing revenue. As president, Murchland is responsible for leading the execution of the Seven Corners’ strategic plan along with the management of day-to-day business operations.