The summer travel season is officially underway, and many industry experts are projecting historic numbers. Two hundred fifty-seven million people are expected to travel on U.S. commercial airlines from June 1 to Aug. 31 – a 9.5% jump from 2022. That would also set a record; volumes are forecasted to exceed summer 2019 levels by approximately 2 million passengers.
Here are some insights from Aon Affinity Travel Practice president Beth Godlin as we head into what’s shaping up to be a very busy Q3 for the travel industry.
Tell us about the state of the travel industry in 2023.
Beth: The cruise and tour operator industries have exploded in 2023. In fact, we’re seeing numbers this year that are close to – or even exceed – 2019. This is certainly exciting, as both industries were the last to recover after the pandemic due to restrictions around sea and international travel.
It’s clear that people are eager to take big-ticket trips. Some have put off vacations for a few years and are yearning to see the world again. There are a lot of loyal travelers out there, and they’re coming back in full force. We’re hopeful that this momentum will continue throughout this summer and the rest of this year.
Have you seen any changes in the distribution of travel insurance?
Recently, a few insurtech platforms have entered the travel insurance marketplace. In fact, I’ve seen many of them at Phocuswright and US Travel Insurance Association (UStiA) conferences. These platforms predominantly cater to companies that are new to selling travel insurance, that operate exclusively online, and that sell directly to the consumer. While I’ve found that more companies are focusing on the direct-to-consumer sales model, they still make up a small share of the market in the United States.
I believe these insurtech platforms emerged during the pandemic, in part, because people had an increased awareness of the importance of travel insurance. And the industry needed to create new products that responded to people’s unique needs.
Let’s talk about the Aon Affinity Travel Insurance Practice. What are you doing to address the evolving needs of travel insurance for consumers in the wholesale market?
One thing that distinguishes us is that our solutions are customized and designed to meet the evolving needs of both our partner clients – like cruise lines and tour operators – as well as their customers. We’re constantly introducing new benefits and products. A prime example of this happened last summer. As more people started traveling again, many experienced travel delays, especially at airports. We were nimble and responded quickly to the situation by modifying our programs to specifically help travelers with trip delays, by offering benefits such as trip delay misconnection insurance. And during the pandemic, many countries required travel insurance with medical benefits, including emergency transportation, for entry. As such, we tailored our products to fit these unique requirements.
We pride ourselves in customization when it comes to product design. And while we demonstrated that during the pandemic, we will continue to innovate to meet the shifting needs of clients and their customers. The travel industry has always been, and will always be, very dynamic.
Why is now the time to work with a travel insurance broker like the Aon Affinity Travel Practice? You have so many long-term client relationships. How do you maintain such partnerships?
There are many reasons to work with us. We’re focused on building partnerships. We treat our clients like partners. We are embedded into their business. We are well-versed in their industries. We are included in their strategic conversations. We focus on helping enhance and protect their brands as the provider of an integral product that ultimately supports their customers. We’ve also built a culture of transparency. At Aon, we’re in the business of helping our clients make better decisions – and providing them with information that will help them grow.
Aon Affinity Travel Practice is the only independent travel insurance broker/consultant service provider of scale in the United States. We work with our carrier partners to determine the best fit for our clients. We look at things like the way a carrier does business, the way our client does business. We look at the products that are available. We go through this entire process before we even bring a solution to a client. We are also an integral part of providing service. We help our clients answer customer queries. We provide materials to customers to help them better understand travel insurance. As a result, we have many loyal partners. We’re always eager to support them.
What’s next for the Travel Practice? Are there any new developments in the pipeline?
In addition to our product customization, we’ve also kicked off a multi-year project to help enhance customer experience. We already have an online claims tool that’s very intuitive and easy to use. It takes a customer about eight minutes – from start to finish – to file a claim.
Over the last couple of years, with the unprecedented sharp fluctuations in travel insurance sales and volume of claims, we continued to take opportunities to survey our customers about changes to help improve their experience even more. Our team is hard at work implementing many of those suggestions and process improvements to help ensure our customers experience a highly optimized and efficient claims process now and into the future.