News analysis: Travel brokers and the challenges of Covid-19


As travel slowly starts to pick up again, Rachel Gordon investigates how specialist travel brokers have coped during the past 16 months of turmoil for this exclusive report.

Against almost unbelievably challenging circumstances, travel insurance brokers are continuing to provide cover, advise their customers - and do their utmost to stay afloat.

After so-called ‘Freedom Day’, many in the UK may want to go on holiday, but are confused by the constantly changing rules around travel. Most recently, double-jabbed travellers were told they need to quarantine on returning from France. The Balearics have been moved onto the ‘amber list’ and Bulgaria, even though on our ‘green’ list, has barred UK travellers from entering. And that’s just in the past week or so…

It’s not the travel as we know it, but bookings are seeing an upturn and this translates into more sales of insurance, allowing brokers to earn some much needed revenue.

So, how have specialist travel brokers coped during the past 16 months of turmoil?

Peter Hayman, director of PJ Hayman & Company, which operates a number of travel cover schemes, says brokers’ resilience has been exceptional and the vast majority have kept trading. He explains most have managed by putting staff on furlough, taking out loans or redeploying staff, if they offered other lines of business. Many also focused on claims handling and issuing refunds.

Despite travel being one of the most badly impacted sectors, there was no tailored additional help and Hayman says the Financial Conduct Authority (FCA) also failed to ease off from making demands on brokers: “It’s as if the FCA has not realised how Covid has affected firms as there remains a heavy regulatory burden.”

He adds while business has increased over the past few weeks, it has been at rates of around 15% of 2019 levels. “I’d like to think that the industry will see recovery by the end of 2022, but it’s impossible to predict what will happen – my crystal ball broke last April. I certainly didn’t expect to see a second disrupted summer. The irony is that back then, and before we had the vaccination programme, it was probably easier to travel.”

How the pandemic affected travel cover

Dale Robinson, marketing manager with broker Just Travel Cover, says while there are still many challenges ahead, he believes the first steps have been taken to a recovery for international travel. He also provided the following figures on the sector and Covid-19, from its own research and from the Mintel Travel Report.

  • The travel insurance market has shrunk by 51% to £393m – pre Covid, the market was worth around £780m and was predicted to grow to £916m by 2023
  • There has been a 78% drop in overseas holidays
  • 400,000 travel insurance claims on Day 1 of lockdown
  • The market is expected to take until 2025 to recover
  • 82% of people think travel insurance is more important than pre Covid
  • Brokers and travel insurance specialists are viewed as ‘reassuring’

Broker Ian Mantel believes it will take around three years to see a recovery. He is associate director with Manor Insurance, part of Green Insurance Group, that operates Travel Insured, which focuses on those with pre-existing health conditions. “We’re seeing more business but a lot of customers are worried about what they need to do about testing or if there are going to be terrible queues at airports – older people in particular are taking a wait and see approach.”

Because travel is just one part of the business, he says it was possible to redeploy staff to other lines of business, although “we had to refund a lot of travel premiums earlier in the pandemic.”

He believes travel insurance will become more expensive, although the product has adapted and is now able to provide suitable cover for Covid risks. “It will just be a respiratory condition that all of us, including the insurance industry, will need to live with.”

Mantel adds though that more customers may have questions about their health and insurance, including if they have Long Covid.

“Disclosure is a huge issue and if travel cover ever fails to respond to a claim, this is often the reason why. I don’t think buying cheap cover online makes sense if anyone has a health issue – we will always direct them to an adviser.

“And a good broker will always have a genuine interest in the customer’s needs and understands that sometimes it can be difficult to talk about health conditions. The way to deal with this is to gently guide them by the hand, find out all the necessary information and ensure they are properly insured.”

Brokers, meanwhile, still need the support of underwriters and particularly if they are to deal with more difficult cases – so are they now back in harness? Unfortunately, Axa said it had no one to answer questions for this article, while Aviva is only dealing with “existing policyholders” via its broker travel offering.

If some providers are slow to gear up, then this means Jackson Lee Underwriting is particularly well placed. In May, the MGA secured the British Insurance Brokers’ Association (Biba) travel scheme for the next three years.

The cover is underwritten by AA-rated capacity, and this is something that Mantel believes is important. “Solvency levels are an issue we keep a very close eye on and that’s become even more important,” he says.

The Biba scheme also offers a Covid-19 extension with cancellation cover and medical expenses for those with NHS double jabs travelling to countries in Europe where the Foreign, Commonwealth and Development Office (FCDO) has advised against “all but essential travel” due to Covid-19.

Also included is cancellation due to the failure to complete the vaccine course due to illness, adverse reaction to Covid-19 vaccine within 14 days of a scheduled departure date and cancellation due to being told to self isolate by the UK Government’s Test and Trace service.

This is in addition to the standard cover for Covid-19 emergency medical treatment, repatriation costs and any extra travel and accommodation expenses aboard if the insured catches Covid. 

“Children who have not been vaccinated will also be covered as long as they are under 18, have not refused a vaccine when offered and are not included in the vaccine roll out.

Senior underwriter, Dipesh Patel, says brokers should now be looking to offer polices with the broadest wordings possible.

He adds brokers are increasingly in contact for information about cover and Jackson Lee allows brokers to speak directly to underwriters if needed. “We have an age limit of 85 for single trips, but if a broker had a customer who was slightly older, for example, then they could talk to us and we’d try to provide cover.”

Brokers may well be dealing with more complex cases, but he points out many pre-existing conditions can now be covered, providing the underwriter has sufficient information. “It’s less about the condition and more about how well it is controlled – if this is the case, then the individual may not be at more risk if they are on holiday than at home.”

Patel says most travel at present is primarily “sensible” so, those wanting to go on holiday to Europe, or people who own a second home, such as in Spain, and who want to go and check all is well.

He adds underwriters are largely following FCDO [Foreign, Commonwealth & Development Office] advice, rather than the government’s “traffic light” system, which can change at short notice and also be irrelevant – Australia may be listed as “green” but the country is currently closed to most arrivals.

Patel also believes the corporate sector will start to pick up next year, as while employers have a duty of care to their staff and are being cautious, they will start to look at travel again. While calls on Zoom and Teams have become the norm, there is still a place for in-person events and there is pent up demand for this to return.

Meanwhile Covid may also prompt more customers, whether buying from a broker or direct, to think about quality rather than simply price.

Battleface is a tech travel insurance intermediary, which has continued operating throughout the pandemic. Policies protect against changes in FCDO advice, regardless of government changes such as to traffic light colours. It offers cover for destinations including countries under FCDO and government essential and non-essential travel advisories.

CEO Sasha Gainullin says as the pandemic hit, Battleface was one of the few customers could use that remained valid. “We were one of the first to market when it came to covering medical expenses caused by or resulting from Covid.”

The policies are available regardless whether the customer has had the Covid vaccination or not.

He says: “Battleface does not actively encourage people to travel to places the FCDO is advising against, we are simply offering them the possibility of being covered in these countries. If leisure travel is banned, there are often legally permitted reasons for international travel which include work, volunteering, family emergencies, education, medical, or compassionate grounds, weddings or funerals.”

He agrees demand continues to rise, pointing out that when a new country enters the green list, there is a spike in bookings. Further, many people have saved money during the pandemic and may want to spend this cash on travel. “Our consumer research found while 50% of Brits have been saving more since the pandemic, two-fifths (41%) are planning to spend more on their holidays once international travel resumes.”

Battleface may be targeting a more tech savvy and younger customer base, but it has sought to meet their needs through focusing on guidance - its Sherpa tool allows uses to find out about country restrictions and apply for e-visas from a single point of contact.

Gainullin adds: “Covid-19 and its variants are unpredictable, but we seem to be finding ways of living with it, so we are feeling very positive about recovery and we continue to give travellers peace of mind by providing travel insurance that doesn’t quit when circumstances change.”

For other customers though, simply being able to pick up the phone to a broker, will be a valuable experience and many uncertainties remain. This includes the cruise industry – an early Covid casualty with stranded cruise ships unable to dock because of sick passengers.

Patel says underwriters continue to have less appetite for cruises, at least for the coming months, unless the destination is around the British Isles. While Hayman agrees that caution is needed: “The sector may start more slowly as there were some big claims, but the industry actually responded very well and dealt with some difficult logistical issues in getting people home.”

Notably, P&O and Cunard are now stating that passengers need cover for Covid-related repatriation for £2m.

Looking ahead, as Hayman says, there has to be some room for optimism and in the standard holiday sector, it is helped that reputable companies are looking to make matters easy for customers by allowing them to rebook if necessary. This will help boost consumer confidence and also lead to more insurance sales.

Despite the new found ‘freedoms’ the UK remains one of the worst in the world in terms of Covid numbers and even chief medical officer, Chris Whitty, has described matters as “quite scary”. Can anyone be blamed for wanting to get away? Frankly, many destinations may be safer than here.

As Mantel concludes: “Covid is going to be with us a long time, so people can either choose to stay in the UK, of if they want to go abroad, there is cover available and brokers will offer high standards of service to ensure they can go away safely.”


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