UAE Travel Insurance Market 2028: Size, Share, Industry Trends, and Growth Forecast

According to the TechSci Research report, “UAE Travel Insurance Market – By Region, By Company, Forecast & Opportunities, 2018-2028F,” the market is expected to grow substantially in the coming years due to several key factors. These include increased awareness among consumers, the rise of business travels, ease of access to travel insurance, and technological innovations in the sector. Travel insurance plays a critical role in safeguarding travelers from unexpected disruptions that can occur during their trips. The UAE travel insurance market is witnessing a significant transformation, driven by shifting consumer preferences, evolving travel trends, and a surge in both business and leisure travel.

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Industry Key Highlights

The UAE travel insurance market has shown remarkable growth in recent years, and its trajectory is set to continue upwards. Key highlights of the market include:

1. Surge in Demand for Travel Insurance: The market for travel insurance in the UAE has been rapidly expanding, with an impressive 150% increase in demand among residents during the second quarter of 2022, compared to the first. This sharp rise in demand has been attributed to a variety of factors, including changing travel habits, growing awareness about the need for protection, and the lingering effects of the COVID-19 pandemic.

2. Innovations in Travel Insurance: Several insurance providers have introduced innovative products and services, catering to diverse consumer needs. Companies have also embraced technology to provide more accessible and personalized coverage options, thereby driving growth in the market.

3. Integration of Digital Platforms: The increasing penetration of digital platforms and mobile apps for purchasing travel insurance has made it easier for consumers to obtain insurance coverage. The integration of Insurtech solutions has streamlined processes, making travel insurance more accessible and affordable.

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1. Government-Driven Regulations: Several countries have mandated travel insurance as a prerequisite for obtaining visas, which has driven an increase in travel insurance uptake among UAE residents. This regulatory change has had a direct impact on market growth.

2. Segmented Market Growth: The UAE travel insurance market is seeing growth in various segments, such as business travelers, senior citizens, and international travelers. Each segment has unique needs that insurance providers are increasingly addressing through tailored products and services.

3. Business Travel Insurance: Business travel is one of the fastest-growing segments in the UAE travel insurance market. With the expansion of corporate travel, demand for business-specific insurance policies is expected to continue to rise.

4. Market Growth Post-COVID: Following the lifting of travel restrictions, international travel is experiencing a resurgence, which has contributed to the growth of the travel insurance market in the UAE. As people return to traveling, the demand for insurance covering trip cancellations, medical emergencies, and other unexpected disruptions has surged.

Drivers of Growth in the UAE Travel Insurance Market

The growth of the travel insurance market in the UAE can be attributed to a range of factors that have positively impacted consumer behavior and market demand.

1. Changing Consumer Preferences and Rising Awareness

In recent years, UAE residents have become more aware of the importance of travel insurance as part of their overall travel planning. This growing awareness is a result of various factors, such as increased information availability and the ongoing pandemic. Many travelers now understand that travel insurance is not just a luxury but a necessity, offering protection against a variety of unpredictable events. This shift in consumer perception is driving demand for comprehensive travel insurance packages.

2. Mandatory Insurance Regulations

Many countries and regions around the world have made travel insurance mandatory for certain types of visas or travel activities. In the UAE, residents traveling abroad to destinations that require travel insurance are increasingly purchasing insurance coverage. Furthermore, the UAE government’s push to ensure that residents are adequately covered while traveling abroad has helped fuel the market’s growth.

3. Rising Business Travel

Business travel has been a significant driver of growth in the UAE travel insurance market. The rise of globalization and the increasing need for corporate travel has contributed to the expansion of business travel insurance policies. Companies are offering travel insurance packages that cater specifically to business travelers, providing coverage for trip cancellations, lost luggage, medical emergencies, and more. This trend is expected to continue as the business travel segment grows.

4. Travel Disruptions and Uncertainty

Events such as flight delays, baggage losses, medical emergencies, and trip cancellations have made travelers more inclined to purchase insurance coverage. With the unpredictability of modern travel, many consumers prefer the peace of mind that comes with knowing they are covered financially in the event of unforeseen circumstances.

5. Technological Advancements and Innovation

The growth of Insurtech companies and the integration of digital platforms have made travel insurance more accessible and efficient. Consumers can now easily purchase insurance coverage online or via mobile apps, which has streamlined the process and made it more affordable. Insurtech companies are also leveraging big data and artificial intelligence to offer personalized insurance solutions that cater to individual needs.

6. The Impact of the COVID-19 Pandemic

The COVID-19 pandemic has had a lasting impact on the travel insurance market. Travelers are now more cautious and aware of the potential risks involved in traveling, and as a result, they are increasingly opting for travel insurance that covers medical emergencies, cancellations, and other COVID-related disruptions. The introduction of COVID-19 coverage packages by insurance providers has driven the demand for comprehensive travel insurance.

Emerging Trends in the UAE Travel Insurance Market

Several emerging trends are shaping the future of the UAE travel insurance market. These trends reflect changing consumer needs, technological advancements, and shifts in the global travel industry.

1. Growth of Digital Platforms and Online Purchases

The use of digital platforms for purchasing travel insurance has been on the rise, and this trend is expected to continue. Consumers now prefer to buy travel insurance online through airline websites, online travel agencies (OTAs), and mobile apps. The convenience of comparing different policies and purchasing insurance with just a few clicks has made online platforms the preferred method of purchase for many travelers.

2. Customized Travel Insurance Products

As consumer preferences become more personalized, travel insurance providers are offering customized products that cater to specific traveler needs. Whether it’s for business, leisure, or senior citizens, insurance products are being tailored to suit the diverse needs of different traveler segments. This trend is expected to continue as insurance companies strive to offer more value to their customers.

3. Rise in Business Travel Insurance

Business travel insurance is becoming a key focus area for insurance companies, particularly as companies expand their operations globally. Corporate travelers often require insurance that covers trip cancellations, medical emergencies, flight delays, and lost luggage. Insurers are responding by offering specialized products that cater to the specific needs of business travelers.

4. Focus on Comprehensive Coverage for COVID-19 and Health-Related Issues

Even though the world is gradually returning to normal, the impact of the COVID-19 pandemic continues to influence travel behavior. Many travelers now prioritize comprehensive travel insurance that includes coverage for COVID-19-related medical emergencies, trip cancellations, and travel disruptions. Insurance companies are expanding their offerings to meet the ongoing demand for pandemic-related coverage.

5. Increased Collaboration Between Insurance Providers and Travel Agencies

In response to growing consumer demand for seamless travel experiences, insurance companies are collaborating with travel agencies, airlines, and OTAs to offer integrated insurance solutions. These partnerships allow travelers to purchase travel insurance directly during the booking process, making it easier for consumers to access coverage at the point of purchase.

6. Sustainability and Eco-Friendly Travel Insurance Products

As sustainability becomes more important to consumers, some travel insurance providers are beginning to offer eco-friendly insurance products. These products may include coverage for sustainable travel activities or the offsetting of carbon emissions related to travel. The growing interest in environmentally conscious travel is expected to drive the demand for these eco-friendly insurance options.

Market Segmentation

The UAE travel insurance market is segmented into various categories, which reflect the diversity of consumer needs and travel behaviors. Below is a breakdown of these key segments:

1. By Trip Type

• Single Trip Travel Insurance: This is a one-time policy that covers a single trip. It is ideal for travelers who do not travel frequently.
• Annual Multi-Trip Travel Insurance: This segment has seen the most growth due to the expanding tourism industry. Travelers who frequently travel for business or leisure benefit from this type of insurance, which offers coverage for multiple trips within a year.
• Long Stay Travel Insurance: This type of insurance is designed for individuals who are traveling for an extended period, often for work, study, or long-term vacations.

2. By Traveler Type

• Senior Citizens: Older travelers require specific coverage, including medical emergencies, evacuation, and trip cancellation. This segment is expected to grow as the elderly population in the UAE continues to rise.
• Business Travelers: This is the fastest-growing segment, driven by the increase in global business travel. Business travel insurance offers specialized coverage for work-related trips.
• Family Travelers: Families traveling together often seek comprehensive coverage that includes medical emergencies, trip cancellations, and lost baggage.
• Independent Travelers: Independent or solo travelers are increasingly purchasing insurance to cover unexpected incidents during their trips.

3. By Travel Type

• Domestic Travel: Although international travel is a major focus, domestic travel insurance is still relevant, especially for residents traveling within the UAE.
• International Travel: The international travel segment is expected to grow significantly as more people resume international trips following the COVID-19 pandemic. This segment requires a wider range of coverage options, including emergency medical evacuation, trip cancellation, and coverage for lost luggage.

4. By Mode of Purchase

• Insurance Companies: Traditional insurance companies dominate the market, offering a wide range of travel insurance products.
• Insurance Agents/Brokers: This segment is growing as insurance agents and brokers help travelers find the best coverage options suited to their needs.
• Others (Insurtech Companies, Third Parties, etc.): Insurtech companies are leveraging technology to disrupt the market, offering convenient online platforms and mobile apps for easy purchase.

5. By Region

• Dubai: As a major global travel hub, Dubai plays a crucial role in the UAE travel insurance market. The city is home to a large number of international travelers, contributing significantly to the market’s growth.
• Abu Dhabi: The capital city is another key market for travel insurance, particularly among business travelers.
• Sharjah, Ajman, and Rest of UAE: These regions also contribute to the growing demand for travel insurance, although at a smaller scale compared to Dubai and Abu Dhabi.

Competitive Analysis

The UAE travel insurance market is highly competitive, with both traditional insurers and newer Insurtech companies vying for market share. Key players in the market include:

• Orient Insurance PJSC
• Alliance Insurance P.S.C
• American International Group, Inc. (AIG)
• Royal & Sun Alliance Insurance
• AXA Insurance (Gulf)
• Oman Insurance Company P.S.C. (Sukoon)
• Islamic Arab Insurance Company
• HSBC UAE Middle East Limited
• Al Sagr National Insurance Company (PSC)
• Dubai National Insurance & Reinsurance P.S.C.

These companies are investing in technology, customer experience improvements, and product innovations to differentiate themselves in the competitive market.

Future Outlook

The UAE travel insurance market is poised for continued growth, driven by emerging trends, technological innovations, and an increase in both leisure and business travel. As consumers become more aware of the importance of travel insurance and as digital platforms make it easier to access coverage, the market will continue to expand. Additionally, the growing number of international travelers, coupled with increasing regulatory requirements, will further fuel demand for travel insurance in the UAE.

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10 Benefits of the Research Report

1. Comprehensive Market Analysis: Provides in-depth analysis of the UAE travel insurance market, including market size, growth potential, and forecasts.
2. Emerging Trends and Drivers: Identifies and analyzes emerging trends and key drivers in the market.
3. Competitive Landscape: Offers a detailed competitive analysis of the key players in the market.
4. Segmentation Insights: Breaks down the market by various segments such as trip type, traveler type, and purchase mode.
5. Regional Insights: Highlights the growth and potential of different regions within the UAE.
6. Technological Advancements: Explores the role of technology and Insurtech in transforming the market.
7. Impact of COVID-19: Analyzes how the pandemic has shaped consumer behavior and demand for travel insurance.
8. Growth Opportunities: Identifies key opportunities for growth in the UAE travel insurance market.
9. Consumer Behavior: Provides insights into the evolving preferences of travelers and their expectations from travel insurance providers.
10. Strategic Decision Making: Supports strategic decision-making with actionable insights on market trends, challenges, and opportunities.

In conclusion, the UAE travel insurance market is set to experience strong growth over the coming years. With increasing awareness, changing travel habits, and advancements in technology, the future looks promising for both insurers and consumers alike. The market’s evolution will continue to be driven by shifting consumer needs, the growing importance of digital platforms, and the ongoing recovery from the COVID-19 pandemic.

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