Latest News
HomeColumnsFeatured ArticlesHow the travel sector can boost loyalty and revenue through insurance technology
Featured Articles

How the travel sector can boost loyalty and revenue through insurance technology

Tech

What’s the solution? And where does insurance technology come into it?

What’s the opportunity
With freedom of movement and the opportunity to explore new places, see friends and family back on the cards again, it will come as no surprise that the desire to travel post-pandemic is stronger than ever.

Good news for the travel sector. Now is the time to create additional revenue and increase bookings. Travel insurance products provide that opportunity.

Granted, insurance is not the most exciting part of booking a trip and often a grudge purchase. However, statistics show the tide is turning and that an increasing number of people want travel insurance products.

People live, work and play digitally, particularly millennials, who are now the largest buyers of insurance. These digital natives are accustomed to their needs being met in the buying journey with the same level of personalisation as online shopping and entertainment.

So what’s the solution? And where does insurance technology come into it?

Enter embedded insurance
Embedded insurance is the ideal solution for travel agents who want to embrace technology and reap the commercial rewards of being able to offer travel insurance products to their customers.

Put simply, embedded insurance is where insurance covers are offered alongside an e-commerce product or service purchase. This means customers don’t have to go looking for insurance, they are shown personalised offerings that relate to their core booking.

Rather than having to install the technology themselves, many travel agents and leisure sector businesses chose to work with an external platform provider. By working with an insurtech that is a MGA (Managing General Agent), all aspects of insurance underwriting, risk analysis, pricing and exposure management are managed for the travel business.

What are the benefits
Embedded insurance can be used effectively in many different sectors. However, its highly personalised nature and ability to increase loyalty as well as revenue make it well suited to the travel industry.

Embedded insurance works by analysing the information a customer has already entered during the buying process on a travel site and automatically offering relevant insurance products. This is one of the ways that embedded insurance can benefit and increase customer loyalty due to its high-level of personalisation. It moves away from prescriptive products offered at point-of-sale to bespoke insurance products that meet the customer’s specific needs.

The post-pandemic landscape not only provides an opportunity to create customer loyalty with increased desire for travel insurance products, but also the type of travel insurance products people want to buy is creating demand.

Having lived through several years of uncertainty with travel and leisure related events often being cancelled, people are now looking for greater protection against circumstances beyond their control.

Bridging the gap between this desire to insure against the unexpected and making the most of the latest technologies is parametric protections. At the forefront of embedded insurance, parametric protection enables travel agents to offer clients a highly sophisticated customer experience, which includes elements such as real-time pricing and immediate compensation.

The jewel in the crown of embedded insurance, as well as building revenue and loyalty, parametric insurance products can help overcome some of the negative associations with insurance customers may have. Namely, inadequate cover, complex policies and difficult claims processes. Parametric insurance helps overcome this due to paying out hours after a trigger event. Avoiding the customer having to file a claim or face a lengthy wait for compensation.

About the author
Meitav Harpaz is the CEO and co-founder of Palo Alto headquartered insurtech startup Pattern, which is reinventing personalized insurance for travel business. Before founding Pattern, Meitav was the founder and CEO of multiple startups in the financial industry, including Eccella Corporation (sold to NGDATA), which provided data engineering solutions and data strategy planning to large corporations in Financial Services.

MH
Meitav Harpaz
+ Posts

Meitav Harpaz is the CEO and co-founder of Palo Alto headquartered insurtech startup Pattern, which is reinventing personalized insurance for travel business. Before founding Pattern, Meitav was the founder and CEO of multiple startups in the financial industry, including Eccella Corporation (sold to NGDATA), which provided data engineering solutions and data strategy planning to large corporations in Financial Services.

21/06/2024
20/06/2024
19/06/2024
18/06/2024
17/06/2024