US travelers had been showing growing confidence in travel, including a demand for international trips, prior to the new CDC requirement that they must receive a negative Covid-19 test prior to reentry. This latest regulation exhibits the ongoing uncertainty of travel. Squaremouth’s data explains why we foresee a significant impact on US travelers, and why Cancel For Any Reason travel insurance will remain in-demand.
Traveler Confidence Was Growing
The impact of the Covid-19 pandemic on the travel insurance industry was immediate, with as much as a 90% decrease in business according to Squaremouth. Since that time, the travel insurance aggregator says consumer confidence was nearing pre-pandemic levels, reporting an 864% increase in purchases since the start of the pandemic to current day. New travel trends, discounts, and the availability of a vaccine undeniably contribute to growing consumer confidence.
International Travel Was Still Leading US Tourist Destinations
Despite widespread border closures, Squaremouth says travelers still favor international trips. Since the pandemic began, 67% of travel insurance policies have been purchased for travel to other countries.
A surge of travel to ‘open’ destinations proved travelers still found a way to leave the country. Squaremouth’s current list of top destinations, once ruled by European countries, now heavily consists of Caribbean destinations that remained open to US travelers, including Mexico, Costa Rica, Turks and Caicos, and the US Virgin Islands. All of these countries will require US citizens to show a negative test before returning home.
Still Plenty of Unknowns in 2021 Travel
Squaremouth says this new rule came at a time when travelers were starting to feel comfortable traveling again, reaffirming the ongoing vulnerability and unpredictability of the travel industry.
While travel insurers are taking steps to meet new and evolving traveler concerns, this announcement proves it is a moving target. Showing a negative test for reentry is just the most recent hurdle travelers need to navigate. It joins previous reasons, like border closures and quarantine rules, that are deterring travelers, and are not covered by standard cancellation travel insurance policies.
For this reason, Squaremouth continues to recommend travelers consider purchasing the Cancel For Any Reason upgrade. Prior to the pandemic, demand for Cancel For Any Reason was low, accounting for only 3.5% of Squaremouth sales in 2019. Following the pandemic, this has skyrocketed to 17%.
“We never recommend travelers pay more for this coverage unless they have a very specific concern that we know isn’t otherwise covered,” says Squaremouth CMO Megan Moncrief. “But in today’s travel climate, Cancel For Any Reason just gives travelers the biggest safety net as more unknowns become reality.”
Squaremouth maintains a large portfolio of travel insurance products that offer coverage related to the coronavirus pandemic, including cancellation and emergency medical benefits for contracting the virus, and Cancel For Any Reason coverage. Travelers can search for policies that include Covid-19-related coverage, including Cancel for Any Reason, here.
Methodology: Data is based on travel insurance policies purchased through Squaremouth.com, comparing sales trends since the start of the Covid-19 pandemic to data from the immediate months and year prior.
KEY CURRENT RESOURCE:
Squaremouth created Travel Insurance for the Coronavirus: The Traveler’s Guide which is updated with available travel insurance coverage and answers to FAQs as the COVID-19 pandemic evolves.
ABOUT SQUAREMOUTH
SQUAREMOUTH compares travel insurance policies from every major travel insurance provider in the United States. Using Squaremouth’s comparison engine and third-party customer reviews, travelers can research and compare travel insurance policies side-by-side. More information can be found at www.squaremouth.com.