By Kris Madden
Being caught up in a natural disaster, civil unrest or industrial action are all too common occurrences for today’s traveller. With the Australian government indicating that it will not meet expenses if travellers are uninsured, and that people will need to take more responsibility for their welfare when travelling overseas, it seems that selling travel and travel insurance go hand in hand.
But some travel agents are reluctant to ask their clients about this essential part of their travel plans.
For clients, insurance is something often seen as a necessary evil, and often a cost they have not budgeted for.
“Many agents make the mistake of expecting a knock back so they either don’t quote for insurance at all, or downplay it with the underselling phrase ‘are you okay for travel insurance?’,” says Allianz global assistance spokesperson Santina Notte.
“The best results come when the agent provides the quote up front. It’s the confidence and expectation that ‘of course my client will need travel insurance’. Don’t assume your customer understands the insurance minefield – not all products are equal,” she says.
While agents are not able to recommend an insurance policy to their customers, they can ensure their customers ask the right questions in determining their travel insurance needs.
For example, if your client was taking a skiing holiday in Austria or Canada, some policies have snow cover included, while others sell it as an additional benefit. It should also be noted that insurance is more expensive if clients are travelling to countries such as the US and Canada, as the medical costs in these countries are among the highest in the world.
“Insurance is all about risk, and premiums are tied to the level of that risk,” says Notte. “Medical treatment costs can mount rapidly, even for relatively minor treatment. A serious medical condition can result in a claim costing more than $1 million.”
QBE national manager sales, distribution and strategy of travel Mark DeLuca says his company believes it’s all about ensuring agents have a really strong, in-depth knowledge of the features and benefits of various products so they can better explain them to their customers.
“To help agents achieve this, we make sure our relationship is a continuous one and we schedule in visits, both formal and informal, to keep them up-to-date on products and any feedback we may have received from travellers,” DeLuca says.
“Travel agents are experts in understanding the common issues experienced by travellers and providing information on the destinations their customers intend to visit. This knowledge, combined with a strong understanding of travel insurance, means agents are in a unique position to explain coverage differences and how a product would protect each individual customer in various scenarios specific to their trip or circumstances.”
DeLuca says agents can create value for their customers by highlighting relevant products to ensure the customer gets the cover they need. As agents are not legally permitted to recommend products, offering factual product advice is usually the best course of action.
It’s also important that agents have a strong understanding of the type of activities their clients intend to undertake, so they can highlight product benefits that are relevant to the customer. Recent independent research by SureSave [1], involving more than 1000 Australian-based travellers, reveals that travel agents’ advice is valued more than ever.
SureSave general manager Michael Callaghan says it’s clear that travellers are seeking guidance from the experts.
“We’re seeing a year on year increase in the perceived value of agents’ advice. In the last two years alone, the number of travellers who view agents as a trusted source of safety and travel advice has jumped dramatically to 73%, which is a 16% increase.”
“With an increasing number of security and safety threats internationally, a growing number of us are relying on the expertise of agents to provide assistance when planning our next holiday,” he says.
Travel agents can typically earn anything between 30-50% commission on travel insurance sales, so those who are not suggesting this to their clients may be missing out on a valuable opportunity to provide additional service and generate extra revenue.
“Commissions on sales of travel insurance can be a good source of income, not to mention a great career opportunity. Customers of travel agents generally place high value on a travel specialist utilising their expertise to help them make their travel plans. Travel agents should be able to help consumers understand the insurance product on offer because they are the experts in the industry. They offer a face-to-face service meaning that consumers have someone they can ask questions or bounce ideas around with,” Allianz’s Notte concludes.
In a world where online transactions are increasing, it’s good to know that people still take comfort in knowing they are dealing with someone who is genuinely interested in understanding their requirements and helping them align these with appropriate insurance. This is just another of the value propositions a travel agent can bring to their customers.
