Travel insurance and assistance in major global markets brochure[2]

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  • 1. Travel Insurance and Assistance in Major Global MarketsTravel Insurance and Assistance in Major Global Markets Report Prospectus March 2011 1
  • 2. Travel Insurance and Assistance in Major Global Markets Prospectus contents PageWhat is the research? 3What methodology has been used? 4How do travel companies surveyed break down? 5What is the report structure? 6What are the key features of the research? 7How can the research be used? 8How can the PartnerBASE™ be used? 9Who can use the research? 10What are some of the key findings? 11-14What is the cost and format? 15How can the research be purchased? 16 2
  • 3. Travel Insurance and Assistance in Major Global Markets What is the research?Finaccord’s report titled Travel Insurance and Assistance in Major Global Markets is the firstcomprehensive study about the market for travel insurance and assistance in ten diverse countries- namely Australia, Brazil, Canada, China, India, Japan, Russia, South Africa, South Korea and theUS - which between them account for just over 50% of both the world’s population and its GDP.Collectively, stand-alone international travel insurance and assistance across these ten markets isestimated by Finaccord to have been worth USD 5.79 billion in gross written premiums in 2010. Inall but one of these countries, this sector is growing, and in some cases this expansion is rapid.These markets are also evolving quickly in terms of product design and distribution trends, withnew channels emerging and partnerships changing on a regular basis.For this study, Finaccord’s research program covered nearly 1,200 travel trade companies and 400banks across the ten countries, combining the results of this detailed investigation with othermarket data and interviews with travel insurance providers to produce the most comprehensivereport ever published on the topic.The report is accompanied by a PartnerBASE™ dataset that details the relationships betweennearly 1,200 travel trade firms (and 400 banks) and their respective travel insurance and assistanceproviders. 3
  • 4. Travel Insurance and Assistance in Major Global Markets What methodology has been used?Finaccord’s investigation into the travel insurance and assistance market draws on several sources ofdata, of which the largest element was an extensive survey of 1,184 travel trade companies acrossthe ten countries, which were contacted between September and November 2010 to find out:• if they distribute travel insurance and assistance policies;• if so, how these policies segment between those covering international and domestic travel;• if so, which operating model is used (e.g. single partner, multiple partners, broker or captive);• and, if so, with which insurance and assistance partner(s) do they operate.These travel trade companies included airlines, ferry / railway operators, online travel portals andstudent travel / gap-year specialists, as well as mainstream travel agents and tour operators. Similarresearch was carried out for 400 banks and other lending institutions, in order to accuratelyunderstand the bank provision of stand-alone travel insurance. The report also includes the top-levelfindings from a separate study (published in November 2010) focusing on the packaged provision oftravel insurance and assistance with payment cards and bank accounts. This study involved thedetailed analysis of more than 5,600 banking products across the same ten global markets.Finaccord also analysed the size, segmentation and dynamics of both the underlying outbound travelmarkets and the markets for stand-alone international travel insurance and assistance, using acombination of published statistics and interviews with leading insurers. 4
  • 5. Travel Insurance and Assistance in Major Global MarketsHow do travel companies surveyed break down? Segmentation by type of travel trade entity Segmentation by country Railway operator, 2.1% Automotive Ferry operator, association, 2.4% Australia, 4.7% United States, 2.0% 16.9% Brazil, 4.8% Airline, 9.8% Canada, 12.8% Online travel portal, 7.2% South Korea, 9.0%Student / gap- year travel agent, 2.4% South Africa, 4.5% China, 17.0% Travel agent / Russia, 12.8% tour operator, 74.2% India, 8.4% Japan, 9.1% Source: Finaccord 5
  • 6. Travel Insurance and Assistance in Major Global Markets What is the report structure?Executive Summary: provides a concise evaluation of the report’s principal findings.Introduction: discusses rationale, research methodology, sample breakdown and definitions.Global Overview: presents a comprehensive overview of the ten markets for international travelinsurance and assistance, including analysis of: the underlying outbound travel markets (for holidayand business travel); the size of the stand-alone international travel insurance and assistancemarkets (for single trip and annual policies) by premiums and by number of policies; the influenceof national wealth and other socio-economic variables; travel trade and bank distribution of stand-alone policies, including market concentration data; the leading international providers of travelinsurance and assistance; and forecasts to 2014.Specific country chapters (10): for each of the ten countries covered, an in-depth analysis of themarket for travel insurance and assistance, including: the underlying foreign travel market,segmented by destination and by purpose of trip; the market for stand-alone international travelinsurance and assistance (for single trip and annual policies), by premiums and by number ofpolicies; the distribution of stand-alone policies by travel trade companies and banks, includingpartnership and competitor analysis; the role of packaged distribution with payment cards and bankaccounts; other significant distribution channels; consideration of the importance of travel insuranceand assistance policies for domestic trips; and forecasts to 2014. 6
  • 7. Travel Insurance and Assistance in Major Global Markets What are the key features of the research?Key features of this report include:• quantification of the market size and segmentation for stand-alone international travel insuranceand assistance across ten major global markets: how much is each market worth, and where is thefastest growth occurring?• segmentation of stand-alone international travel insurance policies between single trip and annualpolicies: how are annual policies developing in each country, and what are the obstacles to theirgrowth?• analysis of competitor share of partnerships: which providers of travel insurance have the mostrelationships with travel trade companies, which providers have been most successful with banks,how does this vary by country, and which local relationships are the most significant?• consideration of other distribution channels in each country: are banks active in selling stand-alonetravel policies, or do they prefer to package travel cover with payment cards or bank accounts, andwhat role is played by direct distributors, brokers and other distribution partners?• availability of an accompanying PartnerBASE™ dataset that fully documents every travelinsurance partnership identified by Finaccord for nearly 1,200 travel trade entities and 400 banks. 7
  • 8. Travel Insurance and Assistance in Major Global Markets How can the research be used?You may be able to use this report and the accompanying PartnerBASE™ dataset in one or more ofthe following ways:• to compare the size, growth rates and future prospects of travel insurance and assistance marketsacross ten diverse geographies;• to understand the supply structure for travel insurance and assistance, including the operatingmodels being used, the level of market concentration and the relative importance of national versusinternational providers;• to identify distribution opportunities, whether by channel or by specific partner;• to appreciate which markets offer the best long-term potential, which are already saturated withcompetitors, and what product or distribution innovations are occurring;• to gain access to a single comprehensive source of information outlining the distributionarrangements for nearly 1,200 travel trade companies and 400 banks, which also identifies around140 insurance and assistance partners and 95 ultimate underwriters. 8
  • 9. Travel Insurance and Assistance in Major Global Markets How can the PartnerBASE™ be used? Filter by type of Identify insurance organisation Select country Choose operating model providers INSURANCE AND ASSISTANCE FOR INTERNATIONAL TRAVELOrganisation Type Country Product offered? Operating model Immediate partner(s) / brand(s)Ertzog Travel agent / tour operator Russia Yes Single partner VSK Insurance HouseEscape Travel Travel agent / tour operator Australia Yes Single partner Cover-Moreescapes.ca Online travel portal Canada Yes Single partner RBC InsuranceEt-china.com Online travel portal China Yes Single partner Chartis ChinaEuras Tours Travel agent / tour operator Japan Yes Single partner JI Accident & Fire Insurance Company Look up specific distributors Source: Finaccord PartnerBASE Note - The PartnerBASE also includes data concerning the provision of insurance and assistance for domestic travel and, for both international and domestic policies, it specifies the underlying insurer(s) and parent(s) of the underlying insurer(s), in addition to the immediate partner(s) / brand(s) as indicated above. For distributors based in China, Japan, Russia and South Korea, the local (non-Roman) alphabet names are also given. 9
  • 10. Travel Insurance and Assistance in Major Global Markets Who can use the research?1. Specialist travel insurance and assistance providers: this study is a comprehensive source of information about ten major global markets, providing unique information and breaking new ground by covering countries not previously researched;2. Multi-line insurers: although specialist providers are often strong in travel trade distribution, there are opportunities for other insurers to gain market share in both this and other channels, and this report provides guidance about these possibilities;3. Travel companies and other existing or potential travel insurance intermediaries: in some countries, sales of travel insurance policies are shifting away from the traditional types of travel trade entity. This report helps you to plan your response to this and to consider what might be the channels of the future;4. Banking organisations and other payment card issuers: this report helps you to evaluate the attractiveness of offering travel insurance to your customers, either as a stand-alone product or as an enhancement packaged with payment cards and bank accounts;5. Management consultancies: are you helping a travel company, assistance firm or insurer with its future plans for the travel insurance and assistance market in any or all of these ten countries? Save time researching the subject yourselves by accessing this publication. 10
  • 11. Travel Insurance and Assistance in Major Global Markets What are some of the key findings? 1. All markets are dominated by single trip policies, rather than annual policies, especially China and India Single trip Annual Australia Brazil Canada China India Japan RussiaSouth AfricaSouth Korea USA Average 0% 20% 40% 60% 80% 100% Approximately split of stand-alone international travel insurance and assistance policies sold, 2010Source: Finaccord research 11
  • 12. Travel Insurance and Assistance in Major Global MarketsWhat are some of the key findings? (cont.) 2. At a forecast average growth rate per annum of 9.7% up to 2014, the number of holiday trips made by Brazilians will outgrow the number of business trips Trips (m) 10 8 Business (CAGR, 4.5%) 6 4 Holiday (CAGR, 9.7%) 2 0 2010e 2014f Source: Ministério do Turismo, World Tourism Organization, Finaccord estimates 12
  • 13. Travel Insurance and Assistance in Major Global MarketsWhat are some of the key findings? (cont.) 3. In most countries, the leading three providers account for over a half of travel trade distribution relationships with concentration at its highest in South Africa100%80% All other partners60% 4th partner 3rd partner40% 2nd partner Leading partner20% 0% Australia Brazil Canada China India Japan Russia South South United Africa Korea StatesSource: Finaccord PartnerBASE 13
  • 14. Travel Insurance and Assistance in Major Global Markets What are some of the key findings? (cont.)4. Key findings from the executive summary include:• the combined value of the stand-alone, international travel insurance and assistance markets inthe ten countries researched was an estimated USD 5.79 billion in gross written premiums in 2010,having grown from an estimated USD 4.25 million in 2006;• in terms of its outright value, the US is the largest of the ten markets analysed, followed indescending order by Canada, Japan, Australia and South Korea;• however, when measured in terms of real (deflated) growth between 2006 and 2010, the US isranked only fifth, behind China, India, Brazil and Russia;• in fact, the number of foreign holiday and leisure trips undertaken by Chinese citizens increasedby an average of 18.3% per year between 2003 and 2010, thanks partly to the expansion of the listof state-approved destination countries to which Chinese tourists are permitted to travel;• in spite of the fact that Indian consumers undertake more than 650 million domestic trips everyyear; domestic travel insurance and assistance policies are not widely available from India’s traveltrade. 14