Airlines often anticipate delays by dropping change fees, but insurance can be a lifesaver for flyers already at the airport. However, our findings were not conclusive enough to suggest the weather will result in a long-term benefit for insurance companies.
Almost 100 million travelers’ plans were interrupted by more than the one million U.S. flight delays and cancellations this winter.
The storms and snow cost passengers an estimated $5.3 billion in lost productivity and out-of-pocket costs, according to a study released earlier this month. That’s almost double the typical winter average of $2.9 billion.
The poor weather may have driven travelers, riddled with fears of day-long delays, to purchase the travel insurance they usually ignore.
“A significant portion of that rise can be attributed to consumers’ increased awareness of the need to purchase travel insurance during severe weather,” Allianz spokesperson Daniel Durazo tells Skift.
Durazo says consumers were especially interested in the Travel Delay benefit that reimburses them for the costs of extra food, lodging, and transportation when their flight is delayed for six or more hours.
The majority of Allianz’s 13 million annual customers purchase the Classic Plan, which costs $200 per trip. That’s expensive for the casual leisure traveler waiting on a domestic flight, but a reasonable safety net for an expensive business flight.
Allianz would not share whether the number of actual claims increased in the first two months of the year.
WorldNomads, another global travel insurance company based in Australia, reports a drop in policy sales for North America year-over-year.
A company spokesperson says that drop may have been caused by a decline in travelers who were put off by the weather; however, it could not determine a direct impact. There was no discernible rise in cancellation claims.
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Photo credit: Flight information including delays are on display on a screen at the Washington Dulles Airport in Dulles, Virginia February 9, 2014. Hyungwon Kang / Reuters