Beyond Lost Luggage: How The Evolving Travel Journey Demands A Smarter Insurance Approach

Despite a cost-conscious climate, the desire to travel has remained a priority for many post-pandemic. People are increasingly looking to invest their money into experiences over possessions as they display an eagerness to explore new cultures and seek out adventure. Similarly, people’s protection needs are rapidly evolving, presenting both an opportunity and challenge for travel insurance providers.

A one-size-fits-all approach to travel insurance is outdated - falling short of customer expectations when so many other areas of people’s lives are met with a blend of personalisation and convenience. At the same time, people's perceptions of travel insurance and previous experiences - or a lack thereof - are very different. This means some people are unaware of the importance of travel insurance, while others are not. In addition, people have had unique and unexpected travel experiences that have shaped specific protection needs for future trips.

Moreover, the current customer journey further dissuades conversion. The overcrowded digital marketplace is hard to navigate, with consumers flooded with multiple products, coverage, and price points, often discouraging purchase due to uncertainty and overwhelming options. Many rely on peer and online recommendations instead. There is a pressing need for a clearer customer experience that understands and anticipates diverse travel protection needs.

This whitepaper contains insights from interviews and surveys of over 2500+ travellers across Asia, revealing their needs and motivations and examining their perceptions of travel insurance. The result is an understanding of the unmet needs of the modern-day traveller when it comes to protection and recommendations going forward to enhance people’s travel journey through travel insurance.

To meet the challenge of better understanding and anticipating the protection needs of the modern traveller across Asia, Klook partnered with Canvas8 - a strategic insights agency and global leader on human behaviour and culture.

Our multi-method approach combined robust quantitative methods with qualitative depth, delivering strategic opportunities for travel insurance providers and a comprehensive understanding of travellers at both regional and market levels.

We surveyed 2,500 respondents across Malaysia, the Philippines, Singapore, South Korea and Hong Kong to understand the various needs, attitudes and behaviours towards travel insurance.

We conducted 10x 90-minute interactive interviews that mirrored the markets in the quantitative phase of the study. This enabled a deeper view into people’s need gaps and ideal product mix, unearthing rich insights for sharpening a travel insurance value proposition and ideating product and messaging solutions.

Travel in a post-pandemic landscape has ushered in a time of a renewed desire for exploration, immersive cultural trips and an appetite for insider experiences. These desires, coupled with heightened safety concerns, have expanded protection needs that travel insurance providers must address.

To better track how the travel landscape is influencing people’s protection needs, it is crucial to map out the external and internal changes that have occurred to anticipate how travel insurance can better deliver protection and peace of mind.

Extreme weather events and natural disasters that have become more frequent and severe in recent years have raised travellers' awareness and need for more comprehensive cover for the unexpected. Such concerns are particularly important to travellers from South Korea with 63% of those surveyed stating they are buying travel insurance for unforeseen events.

Political unrest is another external factor shaping people’s safety concerns, with the increase in instability on a global scale, travellers now must consider or pre-empt how their trip might be impacted due to sudden political upheaval.

Other external factors include economic uncertainty, sudden changes to travel regulations and technology threats, like cyber attacks. Furthermore, environmental concerns are also growing among travellers as people seek out more eco-friendly trips and as an extension, coverage options for such specifications.

When exploring the ever-expanding reasons why people are going on trips, it’s not as simple as people wanting to take a break or to unwind. In fact, 26% of those recently surveyed stated they were looking to learn about a new cultures. As people seek authentic cultural experiences, this highlights a key travel motivation that unveils new protection needs to enhance their experiences.

People are also turning to travel to break out of their comfort zones. 31% of travellers across Asia recently surveyed were looking to travel to have an adventure, while 31% were looking to purchase travel insurance for high-risk activities and 25% for solo travel. Travelers want to push personal limits with their trips, creating an opportunity to explore how protection on such trips could instill confidence.

Unsurprisingly ‘peace of mind’ (54%) was the biggest reason for purchasing travel insurance. Reassuring travellers that they are fully protected on all aspects of their trip is an important emotional pay-off to win over customers and inspire loyalty. The challenge is understanding what ‘peace of mind’ means to people and then being able to deliver it.

People are seeking varying levels of ‘peace of mind’ based on universal tensions, shaping people’s protection needs and influencing their travel goals. These tensions are based on travellers' experiences, awareness of risks and unspoken anxieties.

Some explicit needs and concerns are at the forefront of the traveller’s mind, often triggered by past experiences and perceived risks of a trip. These concerns are typically addressed by coverage most common in the travel insurance market such as medical and lost baggage. When people were asked about their immediate protection needs when selecting travel insurance, 53% stated medical emergencies, 44% loss of baggage, and 40% trip cancellation/interruptions.

Tensions also arise due to situational contexts and the risks people encounter ‘in the moment’ or those that evolve from their experiences. These are often unexpected protection needs that require more specific coverage options or add-ons. Such protection needs are linked to external factors mentioned earlier with 38% of travellers surveyed stating they are looking for natural disaster cover and 35% wanting their travel insurance to include climate alerts.

Finally, some latent needs or concerns linger in consumers' minds and aren't always fully articulated. These may include travel-related anxieties about racism, concerns about pets at home, or fears due to unfamiliarity with specific locations. In fact, 42% of travellers surveyed expressed a desire for destination security advice from their travel insurance provider, highlighting a need for an extra layer of protection to feel secure.

Therefore, by understanding concerns beyond the immediate, travel insurance providers can offer more than protection—they can reassure, empower, and liberate travelers, ultimately enriching their experiences throughout the journey.

As people look to get more out of their trips, travel insurance providers need to evolve - looking beyond a narrow view of protection to ways that give people more proactive control of their experiences.

Travel insurance has an untapped value of being a layer of security and support throughout an entire trip. People’s protection needs are rooted in emotion - which is how travel insurance providers need to connect with their consumers. Simply, people want reassurance, empowerment and liberation through their travel insurance, which can be unlocked in the following ways:

Security concerns and a lack of support abroad can hinder people’s experiences. Travel insurance currently available in the market covers the essentials but often misses the mark with proactive protection that can enhance people’s travels.

However, there is an opportunity to disrupt the market by shifting people’s mindset, which starts with redefining safety as a gateway to experiences.

People want to avoid unwanted feelings of disappointment due to unexpected moments that can ruin their trip. As a result, there is a demand for providers to consider how protection can be stretched to mitigate even small negative moments to protect the quality of their holiday.

However, people are often not aware of or don’t feel sufficiently protected by existing policies in the market that can protect against such unexpected moments.

Therefore, consider offerings that enrich people’s experiences so they don’t ‘miss out on the vibe’. For those burnt by travel insurance providers in the past, offer reassurance that they are fully covered if anything goes wrong.

Travellers can carry subconscious worries about unexpected mishaps that prevent them from fully immersing in their experiences. These concerns often aren’t even considered by traditional travel insurance coverage but can go a long way to unlocking true peace of mind for travellers.

This is very much new territory for travel insurance and consumers haven’t fully considered what could be possible if their subconscious concerns are addressed. However, considering what is missing in the market and what areas could ensure people don't take concerns with them on their travels is key to unlocking this opportunity.