Travel insurance industry needs to push through rate increases

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Travel specialist Mondial Assistance has revealed that the travel insurance industry must push through rate increases if the sector as a whole wishes to return to profitability. This bombshell was dropped by Mike Webb, the CEO of Mondial Assistance, who found that certain underwriters are still quoting prices that will quite clearly result in massive losses at a time during which the travel insurance industry has had to cope with more than its fair share of struggles.

Whilst consumers won't be happy with the 20 to 30% rate increase proposed by Mr Webb and Mondial Assistance, there is surely only so long that travel insurance companies can cope with the increasing costs of medical care both at home and abroad that seem to be producing significant losses for them.

With customers also expecting more and more from their travel insurance company and travellers warned on an almost constant basis about the need to take out a policy before heading for foreign shores, combined with the rise in popularity of online comparison services, it won't be an easy balance to strike for those companies that are badly struggling at the moment.

The solution to this particular issue, according to Mr Webb, is to increase prices charged by travel insurance companies across the board, so that just a couple of companies don't end up being singled out. Whether this happens in a marketplace always seeking a scapegoat and one particular company to blame for price increases remains to be seen.


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