From the Travel Insights Podcast: S2,E7 - POV: Travel Insurance Needs a Revolution
Podcast summary
In this episode of the Travel Insights Podcast, we decided to go completely unscripted to offer a candid look at the current state of the travel insurance industry. Our host, Clay, drawing on his almost decade-long experience and in his role as head of marketing at battleface, discusses the urgent need for evolution within the sector, especially as more providers shift toward embedded insurance offers during the travel booking process. He notes that these ubiquitous, bundled products often lack real relevancy for individual travelers, offering generic benefits regardless of specific trip details, which, in turn, leads to lower opt-in rates.
The conversation then shifts to the holistic customer experience, an area Clay believes has seen more innovation and progress than the product/benefits side within the industry. He emphasizes the importance of empathy, responsiveness, and seamless technology throughout the entire customer journey, from initial purchase to handling claims and dealing with emergencies like medical evacuations. We further highlight that positive customer experiences are directly linked to repeat business and brand loyalty, urging providers to prioritize effective communication and swift resolutions to customer issues.
Rounding out the episode, we examine recent economic trends, including declining consumer confidence and reduced travel demand as shown by TSA and international arrival data. We discuss how these indicators suggest tough times ahead for the travel industry and advocate for flexibility in product offerings and pricing to remain attractive to a broader range of travelers. Throughout, we underscore that the path forward requires industry-wide focus on product relevancy, transparency, and customer-centric strategies to adapt and thrive in a changing travel landscape.
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Chapters
00:00 Evolving Travel Insurance Industry
05:03 Travel Insurance: Addressing Product Relevance Issues
09:21 Key Challenges in Travel Insurance Industry
10:54 Insurance Industry’s Evolving Customer Experience
17:30 Navigating Post-Purchase CX Complexities
23:08 Economic Concerns: Declining Travel Indicators
26:36 Air Travel Decline’s Industry Impact
33:31 Enhancing Travel Insurance Experience
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The Raw State of Travel Insurance: Product Relevancy, Customer Experience, and Navigating Economic Uncertainty
In this episode of the Travel Insights Podcast, host Clay Coomer dives deep into the pressing challenges and emerging opportunities facing the travel insurance industry today. Here, we expand on his candid observations about product relevance, holistic customer experience, and the ripple effects of a shifting economic landscape.
Evolving Travel Insurance: The Call for Relevancy
The first and perhaps loudest message from Clay Coomer’s unscripted episode is this: the travel insurance industry urgently needs to evolve. Despite technology advances across travel and hospitality, travel insurance offers, especially those embedded in booking paths (like adding insurance during flight or hotel reservations), often feel “one-size-fits-all.”
Why is this problematic? As travelers book flights, hotels, or vacation rentals, they are presented with bundled insurance products—mostly identical, regardless of destination, travel type, or individual needs. Imagine a frequent flier, like Clay himself, who never checks a bag but is always offered baggage protection. This lack of personalization doesn’t entice savvy travelers or anyone into spending more on optional protection that doesn’t match their reality.
So, what’s the solution? The industry must harness available data within booking platforms to recommend coverage relevant to specific trips and traveler profiles. Real product relevance—customized offers that adjust based on information travelers already provide—could be the game changer. However, contractual obligations, legacy systems, and risk-averse partnerships mean few providers truly A/B test or innovate in this area. As consumer expectations mature, sticking to the status quo is a recipe for declining attachment rates (the percentage of travelers who opt into insurance at booking).
Key Takeaway:
Travel insurance must embrace flexible technology and data-driven offers to ensure every policy feels meaningful to the traveler. Without this, the opt-in rates—and industry growth—will stagnate.
Beyond Claims: The Power of Holistic Customer Experience
After relevancy, we pivot to customer experience, the space where travel insurance can truly differentiate itself. The insurance industry’s reputation rarely shines, given high-profile stories about slow responses or denied claims. But, as Clay notes, travel insurers, and especially companies like battleface, are improving rapidly.
Travel insurance is unique: it isn’t legally required, like auto or health coverage. This means winning a customer once doesn’t guarantee they’ll return. Positive claims resolution, empathetic support (across chat, phone, or email), and swift crisis management are critical to repeat business and positive reviews.
But the customer journey in travel insurance is complex. Needs vary widely and trip cancellation claims are worlds apart from high-stakes, time-sensitive medical evacuations. Here, the challenge is not just technology, but assembling skilled claim handlers and support agents who can deliver reliability, urgency, and compassion at every stage.
A single claims mishap can amplify across social channels, souring reputation more quickly than a good experience can help it. Thus, every interaction pre- and post-purchase matters in building lifetime value, positive word of mouth, and industry credibility.
Key Takeaway:
In today’s travel insurance landscape, stellar, seamless customer experience is more than nice-to-have; it’s a make-or-break expectation that drives loyalty and repeat sales.
Navigating Economic Uncertainty: Strategies for Survival and Growth
Finally, we grapple with a challenging economic reality: consumer confidence has dropped to a 12-year low, and recent months have seen declining airport and international arrival volumes. With 50% of the U.S. population in the middle class, a dip in disposable income likely means less travel and, in turn, fewer insurance policies sold.
What does survival (and growth) look like in this climate? Creativity, flexibility, and value-centricity are paramount. Travel insurers and partners should:
- Offer tiered, price-sensitive insurance bundles, even at the cost of some margin, to ensure accessibility.
- Use clear, transparent messaging about benefits, cancellations, and refunds.
- Leverage customer data to surface relevant offers, maximizing chances to sell coverage, even if it’s a smaller ticket.
Recognizing that luxury travelers are but a small slice of the market, the industry should focus on broadening appeal and making protection feel indispensable, not an afterthought.
Key Takeaway:
In uncertain times, relevant, reasonably-priced insurance and honest, empathetic communication will keep travelers (and the industry) moving forward.
Final Thoughts
The travel insurance industry stands at a crossroads. Evolving product relevance, human-focused customer service, and adaptability to economic shifts aren’t just trends, they’re necessities. As travelers grow smarter and more selective, insurers must listen, innovate, and remember that behind every policy is a person seeking peace of mind. Now is the time for the industry’s own quiet revolution.
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