Summer Travel Insurance Trends Of 2023

Prepare for turbulence if you’re flying for a summer trip. Travel disruption is expected to sully summer travel, as the airline industry continues to grapple with staff shortages. And as airlines struggle to meet demand, flight cancellations are expected to keep climbing. In the New York region, flight delays are expected to spike by 45% compared to last summer, according to the Federal Aviation Administration.

Delays and cancellations aren’t the only things heating up this summer. The average summer trip cost this year is about 7% higher than last year, according to Squaremouth, a travel insurance comparison provider.

Summertime Blues: More Flight Delays and Cancellations

A summer vacation might mean enduring flight woes and paying more for a vacation.

Flight Delays

In 2022, 23% of flights at the 10 largest airports were delayed. That was up 5% from 2019—before the pandemic—when 18% of flights were delayed, according to flight-tracking site FlightAware.

The uptick in flight delays won’t be cooling off anytime soon. This is due, in part, to the Transportation Security Administration’s prediction that 2023 summer air travel volumes will surpass pre-pandemic levels. With significant delays (a 45% increase) already predicted for this summer in the northeast corridor due to a shortage of air traffic controllers, there’s bound to be tarmac turmoil.

reimburses you for extra costs if your trip is delayed for a reason listed in your policy, as long as it’s after a specified waiting period for benefits to apply (such as six hours).

“Fortunately, travel insurance may help cover the extra cost of meals, transportation and lodging during lengthy delays,” says Daniel Durazo, spokesperson with Allianz Travel. “Feeding the kids at the airport is never cheap, so it’s important to purchase a travel insurance policy that includes travel delay coverage.”

Half (50%) of paid travel insurance claims for 2022 summer trips were for post-departure disruptions such as trip delays, trip interruptions and missed connections, according to Squaremouth.

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Flight Cancellation

Staffing and airline maintenance issues continue to hamper airline operations and cause cancellations. With these issues largely unresolved, and with potential pilot strikes brewing at American Airlines, United Airlines and Southwest Airlines, it’s likely flight cancellations will remain on the upswing this summer.

Pre-departure cancellations accounted for 16% of paid travel insurance claims last summer, making it among the most common travel insurance claims, according to Squaremouth.

Adding to the tumult is hurricane season, which begins June 1.

Travel to the Caribbean, Mexico and southern states of the U.S. may be impacted by severe weather. Flights may need to be canceled or delayed while cruise ships may need to be diverted or delayed as well,” says Scott Adamski, spokesperson with AIG Travel.

Trip cancellation insurance can compensate you for prepaid, non-refundable trip costs if you have to cancel your trip for a reason listed in your policy, such as severe weather, airplane mechanical breakdowns and strikes. For example, if you’re forced to cancel your trip due to a strike at your airline, you can file a trip cancellation claim, as long as you purchased the travel insurance policy before the strike was announced.

Trip cancellation insurance doesn’t cover every reason for canceling. For example, if there is an air traffic control computer network outage and you want to cancel your trip, it may not be covered under trip cancellation benefits because it’s not listed in the policy.

Top Summer 2023 Travel Destinations

Summer vacationers are eager to go abroad this summer: 82% of travel insurance purchases for trips taking place June 1 to Aug. 30, 2023, are for international trips, according to data from Squaremouth.

Terra Baykal, spokesperson for World Nomads, says that Europe is the place to be this summer. “Of those U.S. travelers who have already purchased travel insurance for their summer trips, 45% plan to travel to Europe,” says Baykal, who notes that the top European destinations are Italy and the U.K.

“For our policyholders going to Europe, 63% bought as a solo traveler, 31% as a couple and 6% as a family. A whopping 76% of policyholders are traveling for one to three weeks, a typical reflection of American vacation time.”

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Amount Spent on Travel Insurance Also Rises

“Travelers have banked more PTO and cash over the past two years to fund their wanderlust, allowing them to spend more on travel in spite of record-setting levels of inflation, and many also have the ability to incorporate travel with flexible remote work policies,” observes Durazo of Allianz.

The average spent on travel insurance for summer trips has increased almost 7% since last year, and nearly 18% since 2021, based on Squaremouth data. Because travel insurance costs are largely based on the trip costs being insured, the amount spent on travel insurance will rise as trip costs go up.

Average Spent on Travel Insurance for Summer Trips

While travel insurance can’t protect you from rising costs, it can provide a financial safety net if something unexpected happens and you lose money.

Pack Travel Medical Insurance for International Summer Trips

With the majority of summer travelers taking trips abroad, travel medical insurance is becoming more critical.

“If you need a passport for your trip, you need a travel medical plan,” says Lynn Pina, spokesperson with GeoBlue, which recently conducted a Harris Poll survey of more than 2,000 consumers about traveling abroad.

Most people spend hours planning the perfect trip—from the itinerary, lodging, flights and details like ensuring their cellphone will work—but very few consider the possibility of a medical incident while abroad, which happens a lot more than people may think,” Pina says. “According to our Harris Poll study, we found that one in four have had a medical incident while abroad. That figure rises to four in 10 among those who have traveled abroad in the past five years.”

In the same study, when asked how they would pay for medical treatment abroad, Pina reports that 46% expect to use their domestic health insurance and another 18% said they don’t don’t know what they would do.

Those planning to rely on a U.S. health insurance plan may not be aware of the coverage gaps that could result in emotional and financial distress, says Pina.

Many domestic employer-sponsored health plans offer no coverage abroad. Health plans that do have international coverage may still have gaps in coverage and service, says Pina. For example, you often have to pay upfront for medical treatment in other countries and then file a claim for reimbursement. And medical care received abroad is usually considered out of network for U.S. health plans, which makes it costly.

In addition, says Pina, a medically necessary medical evacuation is typically not covered under a domestic health plan. “Should a traveler need a medical evacuation, they will likely need to pay for it upfront and also try to make the complicated arrangements on their own,” she says. “A medical evacuation could range from $10,000 to more than $100,000 depending on the medical situation and location(s) involved.”

Over a quarter (26%) of travel insurance claims paid for summer travel last year were related to a medical emergency, based on Squaremouth data. A medical evacuation travel insurance claim for $223,000 was Squaremouth’s highest claim payout for 2022. The average medical evacuation claim was for about $83,000.