Why aren’t UAE residents taking out travel insurance?

Summer is upon us. The temperature’s high, the humidity has kicked in and the kids are off-school and driving you crazy. Clearly, it’s time to get away for a couple of weeks. It’s an annual tradition in the UAE that, during the first few weeks of summer, the vast numbers of expats here trundle off home for a little bit of a break. The stats show just how big this time is for travel in the country: Dubai International Airport recently announced that it’s currently in the midst of its busiest days of the year, with an estimated 1.1 million travellers passing through the airport this weekend alone.

Clearly, a lot of people are travelling, then. Unfortunately, though, the vast majority of these travellers will head off without adequate protection.

Here’s what I mean by that: A survey we recently conducted found that less than 35 per cent of UAE residents take out travel insurance before setting off on a trip. And that’s actually down on last year’s numbers. A similar survey we carried out in the summer of 2017 found that around 40 per cent of people regularly take out travel insurance. What does this tell us? More and more people are travelling without coverage.

Why does this matter? Well, travel insurance provides financial protection in the event that you run into an incident while travelling — this could include lost baggage, a cancelled flight, or medical coverage for an illness or injury. On top of that, you have access to a dedicated claims officer whose job it is to guide you through these problems and provide assistance where possible.

Naturally, then, without travel insurance, you lose access to that financial protection. Plus, you’re left on your own to sort out any issue that you may come across while travelling. Again, you may think, “so what? I won’t run into a scenario where

I’ll need to claim anything on travel insurance.”

But incidents can and do happen

— more frequently than you think.

Around 40 per cent of our survey respondents said that they had experienced a travel-related incident over the past 12 months, and that was consistent with the findings of last year’s survey.

Of those people who had suffered from travel-related issues, 23 per cent had lost their baggage, and 19 per cent had seen flight cancellations. Just over five per cent had experienced being stranded in the airport while travelling, and lost or stolen cash had affected almost seven per cent.

By these numbers, if you travel three times in a year, there’s a decent chance that you’re going to run into at least one of these issues. And that’s where travel insurance comes in. It’ll offer you financial protection, as well as access to a dedicated team whose job it is to sort the issues out.

It seems like an obvious precaution to take — like buckling your seatbelt when you get into a car. So why aren’t UAE residents doing it?

Well, according to our survey, not getting covered is actually an honest mistake for a lot of people. Of the respondents who do not take out travel insurance, 32 per cent said that they would like to be covered, but forget to buy ahead of a trip.

But there are other reasons, too. Of those who don’t regularly take out cover, 21 per cent said that travel insurance is too expensive. That’s compared to 13 per cent of respondents who last year said that travel insurance is too expensive. So our take is that, in order to save money in these times of tepid consumer confidence, some people are cutting corners by not taking out coverage.

Meanwhile, a quarter said they don’t see the point in travel insurance at all, which is why they don’t buy.

I’ve already dealt with the point of travel insurance above. But I’d really like to address those who think travel insurance is too expensive; you can purchase a simple travel policy for as little as Dh81 for a week-long trip. That’s a fairly small amount relative to the cost of an entire holiday, including flights and hotels. Most wouldn’t even notice that sort of number if was added onto the cost of their air ticket as a fee.

You’re not legally required to take out travel insurance when you head off on holiday. But if you end up like the 40 per cent of respondents who have seen an incident while travelling, you’ll probably look at that Dh81 as a pretty solid investment.