Considering the Future of Aviation Insurance

The travel industry was already facing its own set of issues before the coronavirus arrived. The collapse of Flybe not only left the majority of its 2,400 workforces redundant but also gave indications on how hard times are for some of the largest names in air travel.

No one could predict what was yet to come. When the coronavirus hit the headlines everyone’s mind first turned to cancel holidays. This resulted in a loss is estimated at no less than $250 billion. It goes without saying that the travel and tourism industry were both the two biggest hit by the pandemic.

It’s not just the airline passengers who have contributed to this substantial loss. Travel reactions and government regulations have played just as big of a part in the entire situation.  It’s looking like the travel industry will have to adapt and innovate or collapse. The same can also be said for regions such as Bangladesh and the Philippines who rely on tourism heavily for a steady source of income.

The future is very uncertain at this moment in time. Companies are still adapting to the situation and it could be months before we see a full-scale plan for how the industry will operate during these challenging times. Luckily, few processes are already coming into effect which gives us a great insight into what the future will hold.

The trust of the public needs to be regained, people won’t be confident about booking flights until processes are established for following social distancing guidelines.

Travelling abroad relies on restrictions to travel. With countries such as Australia and Croatia banning entry from UK travellers, it looks like there is going to be a very limited number of destinations we are actually able to visit. There is also some speculation around how tourism may prolong the life of the coronavirus and have negative effects on tourism hotspots.

Say goodbye to the days when we could leisurely stroll through the airport with no worries and a smile on our face, excited for the holiday ahead. Everything will have changed. Although the travel industry will bounce back, our experience within the airport will change dramatically. 

Upon arrival, an initial temperature screening will be completed. This process has already been implemented in the world-renown Heathrow airport as a trial. Social distancing measures will be stuck to religiously, keeping all travellers 2 meters apart, this changes the whole dynamic of the airport experience and its likely that more processes will come into place over the next couple of months to keep passengers and staff safe.

The greatest concerns lie in our capabilities when it comes to testing. There have been a handful of cases where an individual has contacted the coronavirus but is not showing the known symptoms. This would hinder the effectiveness of temperature screening and may mean that someone who has contacted the coronavirus could still make it abroad, spreading the virus further.

Imagine catching a flight where you’re not crammed next to a stranger, where you have the space that you believe you paid for, well this dream might just come true. Following social distancing guidelines on a plane will be challenging to say the least. As each passenger requires 2 meters of space, therefore, there will be fewer passengers on the flight. This could drive ticket prices up substantially, something that not everyone will be happy about.

When you get onto a plane and hear the dreaded sneeze of someone with a cold, you know what’s coming next. As everyone is sharing a confined space, colds can spread like wildfire during a long flight. This could be said the same about the coronavirus. To counter this, face masks may become essential for all flights, regardless of the distance travelled and the time taken to reach the destination.

Once touching down at your desired destination there will be no more crammed coaches taking you to the airport from the plane. There will have to be new measures in the palace to get passengers to the airport without breaching social distancing guidelines. This could lead to a long walk back to the airport or new infrastructure which enables passengers to get to the airport quickly without coming too close to one another.

As our means of travel changes so does the insurance involved with travel. These changes will be hugely dependent on what are the processes going forward and whilst there is uncertainty around how travel will continue, the same could be said about aviation insurance.

Aviation Insurance refers to an insurance policy that specifically covers the operation of aircraft and the risks involved. Everything such as the injury to the passengers and the financial risks due to the environmental impacts of the aircraft can be covered.

Whilst the travel industry adjusts to these new procedures, aviation insurance will be following the same trend. A policy may have to start offering additional protection against coronavirus related illness, especially if the passenger has contacted the virus during the flight.

Flight attendants and pilots may also require additional cover which goes beyond the standard employer’s liability insurance which is a legal requirement for all employers here in the UK. Airline companies around the globe will be frantically looking to update their existing policy to ensure they are protected against these new risks.