Recent research by Squaremouth, a travel insurance marketplace, has revealed that 2023 will be the year for international travel to fully recover, despite the high inflation, with travellers fulfilling their pent-up desire to travel after the pandemic and plan bigger trips.
According to the research, nearly 90% of insured travel will be for international destinations, which indicated that international travel will reach the pre-pandemic levels for the first time.
Over 60% of travel insurance buyers are born before 1980, which includes Generation X and Baby Boomers; collectively, this group is expected to spend over $2 billion on travel in 2023.
The study further predicts that Antarctica will be a top destination for the first time in 2023. Preliminary trip data for 2023 also shows that Israel, Costa Rica, Japan as well as France and Spain will be the main destinations for the year.
Among these top insured destinations for the year Mexico is ranked first with 2,362 sales and an average trip cost is €3,858, followed by Italy with 1,377 sales and €8,146 average trip cost.
While sales for France and Spain are 770 and 595, respectively, the average trip cost for these destinations varies between €7,711 and €6,790, Antarctica is expected to be the most expensive destination, as the average cost per trip is set at €17,769.
However, the research shows that travellers are becoming more budget conscious in 2023, considering economic uncertainties and increasing prices. Travellers spent an average of 25.53% more on travelling in 2022 compared to pre-pandemic levels.
Millennials are the most affected by price pressure, as they will be spending an average of 40% more on trips compared to pre-pandemic levels.
On the other hand, older travellers have already reached activity levels same as in 2019, but Millennials and Gen Z will continue to spend more on travel insurance.
During the pandemic, these categories experienced the largest drop-off. On the other hand, Millennials and Gen Z started spending more on travel insurance and their market share increased by over 15 per cent.
In 2023, travellers won’t worry as much about Coronavirus as they did in previous years, however, airlines will be at the centre of travellers’ attention.