Reviewing our backpacker product recently, we found that the average cost of medical claims has increased from £370 to £750 in the last two years. This follows the recent announcement from the Foreign and Commonwealth Office (FCO) which found that one-in-four of 16 to 24-year-olds travelled without insurance and only 25% made health-related preparations before going overseas. These statistics, when combined, paint an alarming picture for young travellers.
In the last few years, we have seen a rise in the number of backpacker claims that are not covered. For example, many younger travellers will rely on the off-the-shelf annual family policy which may not provide adequate cover for the activities they engage in or the destinations they visit.
The industry has a responsibility to provide a product that reflects the risks that backpackers face when travelling, including cover for more unusual sports and activities, travel delay for internal connections, problems with visas and entry to remote destinations as well as help following imprisonment abroad.
Although many Brits turn to the UK government for help if they get into trouble while overseas, the British embassy can only help contact family or friends but will not fly them home or pay for hospital bills or legal fees. With adventure sports such as quad biking, jet boating and white water rafting becoming increasingly popular, it is vital that travellers are sufficiently prepared for any accident that might happen while taking part.
It is not just the cost of their health that backpacking or gap year travellers should be worried about. With the increase in expensive gadgets such as iPads, laptops and smart phones, many are travelling with these types of personal effects and need to be prepared for the cost if they are lost or stolen.
The insurance industry needs to recognise and address the needs of these travellers by offering more choice and flexibility in policies by constantly updating their offering to keep up with evolving travel trends. A greater amount of collaboration between the insurance industry and official bodies, such as the FCO, could help identify which aspects of foreign travel need new or improved insurance solutions.
Writen by Greg Lawson, Head of Retail at Columbus Direct