High-impact incidents such as extreme weather events, medical outbreaks and sociopolitical volatility are the top emerging risks for Singaporean travellers over the next 12 months, according to data and forecasts by AIG Asia Pacific Insurance.
Compared with three years ago, the insurance company has seen an 85 per cent increase in travel claims made for high-impact incidents, with natural disasters being the costliest with an average claim amount of S$2,610 (US$1,872).
AIG predicts that these trends will continue throughout 2017 and result in a 10 per cent rise in demand for premium travel products offering a greater amount of cover.
Vice-president and head of group personal insurance, Ignatius Chng, said: “As Singaporeans continue to be savvy and frequent travellers, their global mobility and increased awareness of travel insurance will see them taking a proactive approach and insuring themselves against unforeseen circumstances."
AIG further notes that travel insurance claims relating to sociopolitical volatility have more than doubled in the last three years, with travel disruption resulting from political instability, coup d'état, increased border security and terrorist attacks.
Chng observed: “Singapore travellers are demanding greater levels of coverage... especially since the global security environment has become increasingly volatile in recent years and high-impact incidents are more prevalent.”
Meanwhile, to meet growing demand for a more seamless claims and risk management process, AIG expects travel insurance providers to expand their digital capabilities.
“We have seen an increase in customers making direct purchases digitally, but technology does not stop at distribution. The next step would be for them to embrace disruption and move more service offerings towards the digital,” Chng said.