More Canadians looking to travel as inflation fatigue sets in

More Canadians looking to travel as inflation fatigue sets in | Insurance Business Canada

Insurance News

More Canadians looking to travel as inflation fatigue sets in

Vacation deficit rebounding to pre-pandemic levels

Insurance News

By
David Saric

New findings from Allianz showcase that Canadians are more eager to pursue travel opportunities and vacations even as economic unease still permeates throughout the country, with estimates showing that upwards of $30 billion will be spent on travelling this year.

“There has been a recovery post-pandemic in the Canadian consumer’s mindset around the importance and prioritization of travel — with seven in ten Canadians saying they’re confident they will take a vacation in 2024, which is up seven points from 2023,” said Tayjua Squire, manager of corporate communications at Allianz Global Assistance.

“Affordability is a huge concern among consumers, but they are getting inflation fatigue. As a result, Canadians are prioritizing travel in their budget even if they are stretched thin.”

“In line with rebounding travel volumes, we’ve seen a recovery in the Canadian consumer’s mindset around the importance and prioritization of travel,” added Dan Keon, vice president, marketing & insights at Allianz. “This shift is propelling Canadians’ confidence in taking a vacation this winter to a statistical high point in our seven-year survey, indicating a renewed commitment to travel.”

The percentage of individuals experiencing a “vacation deficit” is also rebounding to pre-pandemic levels, something that Squire noted as being a positive thing.

“The vacation deficit is measured by examining the proportion of Canadians who say taking an annual vacation is important to them but aren’t confident that they’ll take one,” she said. “This year, 17 percent of Canadians fall into the vacation deficit category – down four points from last year but higher than when measured in the years immediately preceding the pandemic — however, this deficit is trending the right direction.”

“Canadians have been heavily impacted by rising living costs so it’s no surprise that the study found the biggest obstacle to taking a vacation relates to financial pressures,” said Keon.

With inflationary woes still lingering, it is more important than ever for travellers to seek out methods to help alleviate any unexpected or potentially cumbersome expenses that can happen when visiting foreign countries.

A new cohort leading this yearn to vacation and explore

Allianz’s Vacation Confidence Study found that people aged 55 and older are expected to be making the most of travelling this year, after a period of respite from any international activity.

“Those aged 55+ are more confident they will travel this year after being more cautious coming out of the pandemic, finally rebounding to its 2019 numbers in terms of travel intentions,” Squire said.

However, getting back to travel does not mean that a cautious return to regular life post-pandemic has diminished or waned.

“The majority of those 55+, 87 percent, believe that travel insurance is important when travelling outside of Canada. This desire to be protected translates into positive purchase behaviour, with most 55+ Canadians, 79 percent, purchasing travel medical insurance for their trips,” Squire said.

The report revealed that 89% of Canadians planned to obtain travel insurance for their next trip and that a strong majority, 84%, saw travel insurance as important when traveling internationally.

While premium is subject to travel specifics including destination, duration, benefits purchased and traveller’s age, brokers, insurance professionals and even the Government of Canada support this essential purchase as part of any budgeted vacation.

“It has never been more critical for travellers to protect their vacation investment,” Squire said. “Travel insurance premiums are a fraction of the potential cost of healthcare abroad when a medical emergency occurs.”