Why Purchase Travel Insurance in 2020

They say only two things are certain: death and taxes. Everything else falls along a spectrum of probability. For example, although not guaranteed, you can look at historical evidence and speculate with some certainty that travel costs are likely to go up in the coming year. Below are some supporting specifics.

Inflation

According to information posted on InflationData.com, the current annual inflation rate for the 12 months ending in Nov. 2019 is 2.05%. In addition, if you look at the US inflation rate year by year from 1929 to the present (thebalance.com), you see this positive inflation trend has persisted over the longer term. This trend points to the probability that goods and services are going to cost more in the coming year. This includes goods and services related to travel, such as hotel costs, food, etc.

Fuel costs

The price of jet fuel, according to information posted in Aug. 2018 from Avionics International is 36.5% than it was the year prior. Because of this change, airlines may increase fares or reduce the number of flights. Historically, fuel prices have increased over time as anyone who’s been filling their gas tanks for any length of time can attest. This is due to a variety of reasons, according to a BBC News statement, including political instability, tax and exchange rate variances.  

Flight costs

As mentioned above, flight costs are directly connected with the price of jet fuel. Plus, in order to stay viable, airlines have consistently increased costs through other means, such as the charging of checked baggage and handling fees.

So, what’s the point of all this information? Why communicate all this doom and gloom? The reason is to verify the establishment of a pattern.

Costs associated with travel have been increasing, and will likely continue increasing in the future. With travel costs on an upward trajectory, travelers must invest larger amounts. Therefore, they also suffer a bigger loss if they are unable to complete their travels. For example, what happens if a traveler gets seriously ill just prior to a trip and they have to cancel? What if their flights and hotel costs are not refundable? How can they recoup their investment?

One answer is travel insurance. With costs rising, travel insurance is more important than ever.