Taking out travel insurance vital: new research finds global conflict and climate change are increasing interest in travel insurance 

Date: 17/02/2025 by Southern Cross Travel Insurance

The latest Future of Travel study by Southern Cross Travel Insurance (SCTI) shows 73% of New Zealanders agree they are more likely to take out travel insurance due to feeling uneasy about global unrest.

In fact, 78% say travel insurance is now a high priority.¹

The study surveyed 1,002 New Zealanders nationwide in November 2024 to determine current travel trends.

Jo McCauley, Chief Executive Officer at SCTI says outbreaks of violence can happen unexpectedly and are “clearly a concern” for travellers.

“Nearly 80% of the New Zealanders we surveyed indicated that the increase in conflict in many parts of the world has made them feel less secure and more inclined to take out travel insurance. So, we’re keen to ensure travellers are fully aware of how insurance can respond in these situations.”

Travel insurers do not generally cover destinations experiencing conflict. At SCTI, this currently includes Israel, Syria, Sudan, Iran and Iraq.

“If conflict breaks out and is well-publicised before a traveller bought their policy or sets off on their journey, it’s unlikely related claims would be successful. But it can be a different story when conflict breaks out in countries insured travellers are already visiting or they had bought insurance before the conflict occurred,” says McCauley.

For instance, SCTI was able to support some New Zealanders who needed assistance when the Israel/Gaza conflict initially broke out.

According to SCTI data, the top three claims paid to customers who had begun their journeys from New Zealand to the Middle East region, and whose trips were affected by unexpected events, came to $7,140, $6,625 and $5,192.

Travel insurers can also step in and support travelling customers for other issues and events outside their control.

“The study also showed nearly three in four New Zealanders agree travel insurance is more important now that climate change has made weather patterns unpredictable and natural disasters more likely,” says McCauley.

“We’re increasingly seeing travellers affected by climate change with 1,425 customers’ plans impacted by the Auckland Anniversary floods, more than 720 having to cope with travel disruption from Cyclone Gabrielle, and dozens affected by recent and severe winter storms in the USA.”

Other unexpected issues can also crop up. SCTI data shows the largest claim they covered for the 2024 Vanuatu earthquake was $4,800. That said, insurance claims are still more likely to be made for medical emergencies, the flu, Covid (still), lost or damaged mobile phones and travel interruptions when travelling.

For example, SCTI data shows the claims paid for November 2023 through to the end of January 2024 totalled more than $5.6 million for everything from changes to journey and childcare expenses, to rental vehicle excesses and personal accidents.

• $1.03 million for baggage or personal items claims
• $1.74 million for changes to journey claims • $65k for cash and documents claims
• $2.7 million for medical care claims
• $79k for accident and personal liability claims
• $85k for rental vehicle excess claims

McCauley says these numbers should certainly make domestic and international travellers think twice about heading away without travel insurance.

The study also indicated New Zealanders think travel insurance is a more of high priority for international travel than domestic travel (78% to 40%).

But McCauley says travellers shouldn’t minimise the risks associated with domestic travel given some of the costly claims SCTI has seen for cruises and Great Walks.

She says one such recent claim came in for more than $11,000. “The trip was cancelled due to the traveller contracting Covid and the hike was non-refundable.

McCauley says the average domestic claim sits at 70% on average of the value of an international claim.

“We recently looked at the number of claims we received for Domestic NZ vs our flagship International Comprehensive policy. As a percentage of policies sold, we received more claims for our domestic policies than our international comprehensive policy.

“It’s best to consider both domestic and international travel insurance when travelling.”

Travel tips

Keep an eye on your stuff

Travel insurers, like all insurers, ask you to play your part when it comes to keeping your stuff safe. This means that generally, baggage and personal items (like mobile phones) are not covered if they are left unattended in a public place. For example, if you leave your things in a place where someone could take them without your knowledge or you leave them at such a distance from you that you can’t attempt to stop someone from unlawfully taking the items, you may not be covered if they go missing. Public places can include public transport such as the luggage racks on trains.

But what if the train operator insists I place my bag in the luggage rack?

This is often the case – and that’s their prerogative. Some of the things you can do to put someone off going through your things include:

• wrapping your bag in the plastic available at many airports or train stations (or you can do this yourself) and responsibly disposing of any unwanted wrap
• putting an Air Tag, Tile, or similar tracking device in your bag • making sure you have a secure lock or combination lock on your bag and preferably using a bag with a hard shell
• travelling with as little gear as possible using an overnight bag or backpack (this can cost you less when travelling, but the main advantage is you have less to lug around or lose!).

What if someone rifles through my things in the overhead locker above my seat on a plane?

With this example, provided you have done everything reasonable to protect your belongings, and you have a record of this happening, you will likely be covered.

It’s important to note that travel insurance cover for baggage and personal items cover is generally for lost, stolen or damaged items and to help purchase essential clothing and toiletries, if your bags are delayed, misdirected or misplaced by an airline or other operator for more than 12 hours.

Between January 1 and December 31 2024, SCTI received claims for more than 1,600 lost items for International Comprehensive and Domestic policy customers. On top of that, they also received claims for more than 1,500 electronic items. The largest claim paid for lost or damaged electronics was $5,572 for camera equipment.

Other handy travel insurance tips

• If you’re visiting a country where it’s common to travel by motorbike, moped or scooter, whether self-driven or being a passenger, including motorbike taxi, travellers should consider adding optional moped and motorbike cover to extend the benefits of the policy.
• There are terms and conditions, for example, travellers must always wear a helmet, even if the local laws don’t require you to do so. It’s important to stay within the law including speed limits and blood alcohol limits. Travellers generally aren’t covered if the motorbike or moped has an engine over 200cc. From 1 Jan to 31 December 2024, SCTI data shows customers made 55 motorbike or moped claims – with one of the largest paid coming in at $89,500.
• When renting a vehicle (car, motorhome, moped or motorbike) to be covered, the driver must be listed on the Certificate of Insurance and the rental vehicle agreement. They must also follow the relevant laws, including driving laws and highway rules such as speed limits and blood alcohol limits. Claims, costs, losses or liabilities are not covered if they directly or indirectly relate to being under the influence of alcohol, solvents, or drugs – including your conduct while under their influence.
• If you are skiing and snowboarding, consider extra optional cover. You must always wear a helmet and follow the commercial ski area’s notices or regulations. One of the 161 claims made to SCTI between 1 Jan and 31 December 2024 came in at $26,280.
• If sailing or cruising for one night or more, consider taking out Cruise cover. Ocean yachting is included if you’re both within 12 nautical miles (22.2 km) of populated land and in an area with access to telecommunication and medical services. Otherwise claims, costs or losses or liabilities are not covered.
• A number of adventure sports are covered as long as you’re taking part with a licensed operator, following their safety instructions, and wearing all required safety equipment for caving, bungee jumping, outdoor rock climbing and white water kayaking for example. Diving is included if you hold an open-water diving certificate or you’re diving with a qualified instructor. Otherwise claims, costs or losses or liabilities are not covered.
• Claims, costs or losses or liabilities are not covered for extreme sports including kitesurfing, motor sports and sky diving. Neither are they covered for physical contact during a contact sport) and any professional sport. 
• If you are planning on mountaineering, hiking, trekking or tramping and if climbing equipment should be used, or if above 3,000m in altitude, or if at an altitude of between 1,500 and 3,000 metres and you’re climbing, or intending to climb, more than 500 metres a day…then you need to talk to a specialist provider!

¹ There are some regional differences, with Christchurch residents (81%) significantly more likely than Aucklanders and other North Island residents (71%) to agree.