More people are travelling in retirement than ever before. According to a new study by Avanti, a specialist travel insurance provider catering for the over-50s market, the number of Europeans aged 65 and over heading abroad every year has increased faster over the past 20 years than the population in this age group has grown.
Some possible underlying reasons for this trend might include people finding themselves with more disposable income in retirement, cheaper travel and better health. However, the same study found that, amongst those older citizens who did not make it abroad regularly, two factors came to the fore to explain why – money and health.
Looking at trends across Europe, the study found plenty of variation in how these two played out from country to country. As a general trend, over-65s from western European countries such as Germany, Spain and France were less likely to see money as an obstacle to travel, whereas in places like Bulgaria, Hungary and Greece, finances were the most common reason given for not travelling abroad.
The UK presented an interesting case – two in five (41%) pensioners who hadn’t been abroad in the past year said it was because they couldn’t afford to, while only 12% cited health. In Germany, Spain, France, Greece and Bulgaria, around a third of elderly people said health was the main reason for them not travelling overseas.
Cost of insurance
The survey did, however, find close to unanimous consensus as to what constitutes the biggest worry for older travellers when they head abroad – 85% of people over 65 said the cost of travel insurance. And travel insurance becomes problematic because providers judge that older people are more likely to claim medical treatment when they travel as a result of less robust health.
The main issue for older travellers, however, is that even when they have no specific health complaints to declare to an insurance provider, too many firms will penalise them anyway with greatly inflated premiums. The pattern is that, past the age of about 60, mainstream providers will simply apply automatic year-on-year price hikes based on age alone, and the size of the increases accelerates as you get older.
By the time they hit their 80s, travellers can often be paying six times the amount for their travel insurance that someone in the 50s would be charged for the same policy, even though the average difference in the size of claims is probably only half that. It means that older travellers can reach a point where the cost of insurance means they can’t afford to travel at all, even though they are in perfectly good health.
Avanti advocates putting aside automatic premium increases by age altogether, and instead basing costs entirely on the personal circumstances of the individual. To read the report in full, view here.