The UAE travel insurance
market is anticipated to be driven by an expansion of the tourist industry and increased
awareness about the benefits of travel insurance is fueling the growth of the travel
Insurance market during the projected period.
The travel insurance
demand is mainly expected to be driven by increasing domestic and international
travel throughout the forecast period. According to information from the World
Tourism Organization, UAE citizens spent around USD 21.78 billion (or 80
billion dirhams) on travel and tourism in 2021. In a similar vein, the
organization's data indicated that the UAE ranked first at the regional level
and sixth globally in terms of spending rates on travel and tourism, as
reported by the "Emirates Today" newspaper. Furthermore, the average
per capita tourism and travel expenditure in the UAE was approximately USD 2,500.
As a result, rising tourism spending is anticipated to provide the travel
insurance industry with significant growth potential in the coming years.
Moreover, Policybazaar,
a travel insurance company, reported a 150% increase in sales of travel
insurance policies in the April-June quarter of 2022 compared to the first
quarter of this year in the UAE market.
Increasing Issue of
Flight Cancellations and Delays Drives the Market Growth
Despite an increase in
travel, there have been a lot of flight delays and cancellations in recent
months at airports all over the world. In fact, one of the most frequent
problems encountered by travelers from the UAE is delayed or lost check-in
baggage. According to the most recent data released by the US Department of
Transportation, about 220,000 baggage were "mishandled" by US
airlines in April 2022, which means they were lost, harmed, delayed, or stolen.
Many bags are either left behind or go missing due to staff shortages,
especially in large European airports like Amsterdam and London where many
travelers use connecting flights for international travel. The airline may only
offer a small reimbursement, which is surely insufficient. Fortunately, travel
insurance providers offer coverage for both baggage delay and baggage loss,
thus the market need for travel insurance businesses is expected to rise during
the anticipated period.