Travel insurance prices fall as competition rises

09 May 2008 / by Joy Tibbs
While almost everything seems to be getting more expensive, the good news for UK holidaymakers is that travel insurance prices have fallen considerably.

As the travel sector continues to grow, so does competition between travel insurance providers, and according to a report from Defaqto entitled 'Travel Insurance 2008 - Adapting to a Changing World', the number of overseas trips rose more than 17 per cent between 2002 and 2006. The study also shows that Brits are travelling further afield on their holidays.

The company analysed 235 single trip and 245 annual travel insurance policies in order to evaluate premium changes since 2002. It found that the only type of premium to rise in price since 2002 was annual travel insurance for trips to the USA. However, prices were still lower than in 2003, even before inflation is taken into account.

Report author, Brian Brown, said: "Competition in the travel insurance market is having a very significant effect on the price of travel cover."

"The availability of a huge number of policies, many of them online, has driven many insurers to lower their premiums."

However, Defaqto claims that approximately one in seven holidaymakers still go abroad without travel insurance. Mr Brown takes issue with this: "Single trip cover to Europe can now be bought for as little as £6 for a week's holiday. There really should be no excuse for people to travel uninsured."

And research from American Express Insurance Services could reveal a greater need for jet-setters to make sure they are covered. It found that laptops and Blackberries are becoming common poolside accessories as one in seven UK holidaymakers uses the gadgets to keep in touch with their office while they are away.

Head of American Express Insurance Services, Chris Rolland, said: "Brits should check their insurance policies to make certain their poolside gadgets are covered up to their maximum price, just in case they are ruined with a splash."

©Fair Investment Company Ltd