All is not doom and gloom as researchers take the temperature of potential consumer travelers this year. Results of a U.S. Traveler Sentiment index, called “Travelhorizons,” were reported in mid-March after being conducted by the consumer research firm YPartnership for the U.S. Travel Association. Travelhorizons compared the intentions of American consumers to travel in February 2009 compared to the start of the index two years earlier in March 2007, when it was set at 100 as a starting point. The reading of 90.2 in February, according to YPartnership, was a sharp increase from 78.2 in October of 2008. The surge in consumer interest was credited to “the affordability of travel” with this year’s cruise, hotel, car rental and attractions discounts seen as having marked impact on consumers’ interest to book trips. “This is the first increase we have observed in the index since January of 2008,” YPartnership chairman Peter Yesawich said in a Travel Trade report.
Travel agent Margaret Richcreek of Richcreek Vacation Center in Harrisburg, PA, kept her grateful travel insurance partners in mind during a recent interview with Harrisburg’s Patriot-News travel columnist Annette Reiff. In a “Midstate Traveler” column titled “Insurance Policy Can Help Protect Dream Vacation,” Richcreek was asked to provide her industry expertise on how the right insurance can save a client’s trip.
“Tour companies’ coverage is not as comprehensive as that from an insurance company,” Reiff wrote. “Richcreek has found that insurance sold by cruise lines is generally more expensive than buying coverage from an insurance company. Richcreek sells policies offered by Travel Insured International, whose least expensive policy includes coverage for trip cancellation, trip interruption, missed flight connections, baggage and personal effects, baggage delay, terrorism, emergency accident and medical expenses, emergency evacuation and transport of remains. The company’s most expensive policy offers higher coverage amounts for most of those problems along with additional coverage for preexisting medical conditions, financial default, accidental death and dismemberment.”
Reiff added Richcreek’s recommendation that “for all four levels of [Travel Insured’s] coverage, policy holders can buy optional protection that allows them to cancel for any reason up to 48 hours before departure and receive a 75 percent refund of nonrefundable costs.” Travel Insured thanks Margaret Richcreek, and all our loyal travel agent partners, for recommending Travel Insured to their clients, their friends and to the travel media! A second part of the Richcreek news interview will be covered in our next letter.
Travel agent John Frenaye, a respected industry writer and President / CEO of JVE Group in Annapolis, MD, gave wise advice on March 21st to fellow travel agents in the online travel newsletter Travel Research Online (www.travelresearchonline.com). Frenaye cautioned agents that in this weak economy tour operators may be financially vulnerable to uncertain consumer travel demand. He warned it is vital for agents to sell travel insurance in order to financially protect their business in case a supplier goes bankrupt after clients have prepaid for their trip.
“Who is your client going to blame when their trip does not appear but their money has disappeared?” John wrote. “Right or wrong, you will be involved. So, what is the solution? Pick the right supplier and sell travel insurance! … I am talking about a full fledged bona-fide third party insurance policy underwritten by a surety that is rated by A.M. Best. Please, please do not make the mistake of thinking that a supplier’s trip cancellation waiver is insurance. It is not. And if the supplier defaults, your client has no recourse.” Our thanks to John for sharing his insights with industry peers. We could not have said it better.
A March 23rd Chicago Tribune article on travel insurance (“Travel Insurance: Trying to Collect it Can be a Real Trip”) by writer Carol Pucci gave some important new reasons why people are shopping for travel insurance with their trips this year. Top priorities for travelers, according to the article, are job loss protection, Cancel for Work Reasons coverage and default and bankruptcy coverage in case your travel supplier becomes insolvent. Missing from the article, however, was the reminder that potential health risks for travelers remain the biggest reason for obtaining travel insurance even as job-related and financial concerns have gained new attention.
Travel Insured sent a note to the Chicago Tribune travel editor asking him and writer Pucci to remind readers that the U.S. State Department recommends travel insurance for international trips (http://travel.state.gov/travel/tips/tips_1232.html#health) because most U.S. health plans and Medicare programs do not provide coverage outside the U.S. Additionally, covering against Trip Cancellation due to disruptive illnesses or accidents involving non-traveling, as well as traveling, family members, especially elderly ones, is a top priority for adding travel insurance to a trip booking.
Travel Insured is aware that a sales challenge faced by agents this year is convincing travel clients to book early rather than wait for last-minute travel discounts. One incentive you can offer them to book now, not later, is to let them know that Travel Insured can check their insurance rates if a travel discount offer reduces the cost of their trip between booking and departure.
When the lower trip cost results in a refund or reduced final trip payment and also lowers your clients’ insurance rate, Travel Insured is able to issue a refund to their credit card account. Although a reduction in the client’s policy premium would result in a recall of the proportional share of the travel agent commission, your agent advantage is in offering your client a clear incentive to book now with confidence that they will get a good deal on both their trip cost and insurance premium. Your client will be less inclined to wait for a better deal to come along later, if at all.
As you know, some suppliers and online agencies are now promoting price guarantees including refunds should a post-booking promotional discount lower their prepaid trip cost. Help yourself compete for early travel bookings by reassuring clients that their Travel Insured coverage cost may go down when these post-booking travel promotions occur.
The March 26th issue of Travel Weekly reported that weeks after the states of Florida and Colorado moved against an unlicensed travel protection company the state of Florida’s Division of Consumer Protection was still issuing new warnings to travel agents. The department issued cease-and-desist orders while warning travel agents that financial penalties may be imposed on them if and when they are found to be selling any travel protection plans not legally licensed as travel insurance in the state.
Agents, especially if presented with attractive pricing or commission offers by insurers with whom they are not familiar, must protect themselves by doing research. The insurer you sell must be legally licensed in all states where you sell travel, and its protection products must have government approval for sale. One key is to identify the insurer’s underwriter and learn its financial strength rating from a respected rating service such as A.M. Best. Travel Insured International is licensed in all states and its underwriter Arch Insurance is rated A (“excellent”) by A.M. Best.
Travel Insured has introduced a simpler way to sell and book group travel insurance. Starting April 6, group trip planners can choose from Lite or Deluxe coverage with one set of premium rates for each, whether sold as inclusive for all group members or voluntary for each member. Motorcoach, Post-Departure and Basic plans are now brought together under the Lite plan.
A Cancel for Any Reason option is available individually to members provided they buy the plan within 14 days of their initial trip deposit. A waiver that can cover Pre-Existing Medical conditions can be obtained provided the group plan is purchased prior to the final trip payment. Families of 10 or more members traveling on the same itinerary are now eligible to be covered under the same plan. Additional information including benefits, limits and pricing is available at www.travelinsured.com. Group leaders and their travel planners can learn more about the new Travel Insured Group Plans from Travel Insured’s Group Administrator by Emailing firstname.lastname@example.org, or by phoning 1-800-243-3174 ext. 148.