Interest in domestic travel insurance doubles

Thursday , 10 September 2020 by Alaina McGregor

Southern Cross Travel Insurance launches new domestic travel insurance product

A quarter of Kiwis are now more likely to purchase domestic travel insurance than 12 months ago, research by Southern Cross Travel Insurance (SCTI) has found.

The study, which was commissioned by the leading travel insurer and surveyed a thousand Kiwis nationwide, found there was a heightened sense of what could go wrong on holiday following the global pandemic this year.

Just 11 per cent of Kiwis1 purchased domestic travel insurance last year before the outbreak of COVID-19, but the new study reveals 27 per cent of Kiwis2 now intend to buy it ahead of their next domestic holiday.

The main reasons for this shift are:

  • concerns that travel may be impacted in some way e.g. cancellations (57 per cent).
  • becoming more aware of the importance of having domestic travel insurance (38 per cent).
    SCTI has responded to these changing travel trends and launched a comprehensive domestic travel insurance product to give Kiwis peace of mind while on holiday in New Zealand.Jo McCauley 200x300

Jo McCauley 200x300SCTI Chief Executive Jo McCauley said, “Kiwis have told us when looking for domestic travel insurance they want cancellation cover, theft and loss of luggage and rental car excess reduction - so we’ve tailored our product to include these benefits.

“Many Kiwis taking a road trip don’t often realise that purchasing domestic travel insurance can be more cost-effective than paying for excess reduction directly through a rental car company,” added McCauley.

SCTI has calculated that a customer could pay approximately $90-95* for a seven-day domestic travel insurance policy for two adults aged 35 years-old and two dependent children, which includes cover for their rental vehicle excess.

McCauley said when someone hires a car, an excess is usually charged if the car is damaged or stolen which can be thousands of dollars.

“If you want to reduce this excess to something more affordable, an additional daily fee needs to be paid. We’ve calculated that when hiring a typical family car over seven days, this could cost several hundred dollars – much more than taking out domestic cover with SCTI,” said McCauley.

McCauley said SCTI has strengthened its commitment to transparency and providing excellent customer service by writing its new policy in plain language.

“We know nobody likes to read the small print but it’s incredibly important our customers know what they’re covered for. We are pleased to launch a policy for the first time in plain language and we look forward to introducing it to some of our other popular policies soon.

“SCTI is the first travel insurer in New Zealand to have its domestic travel insurance policy awarded the Write Mark. This is an independent endorsement awarded to documents that achieve a high standard of plain language.”

McCauley said this duty of care has always been at the heart of its customer service, but it’s never been more important than during SCTI’s response to COVID-19.

“We have been here for our customers from the start of the pandemic, helping to get Kiwis stranded overseas home safely. We have also been proactive in offering refunds for policies and waiving cancellation fees for customers that have not been able to travel due to the ongoing global travel restrictions,” said McCauley.

SCTI domestic travel insurance product benefits

  • cancelling or changing your journey before you leave (unlimited).
  • changes to journey once you have left ($50,000 per paying person).
  • rental vehicle excess ($6,000 per paying person).
  • baggage and personal items ($30,000 per paying person).

The policy also provides domestic travel insurance benefits that are popular overseas but will be new to many Kiwis including cover for domestic pet services ($500) and pre-paid childcare costs ($500).

Key findings

  • 25 per cent of Kiwis are more likely to purchase domestic travel insurance than 12 months ago.
  • 27 per cent of Kiwis intend to purchase domestic travel insurance for their next holiday in New Zealand.
  • Key reasons for purchasing domestic travel insurance are concerns that their domestic travel may be impacted in some way in the future like cancellations (57 per cent), more aware of the importance of having domestic travel insurance (38 per cent), more likely to travel domestically because they can’t holiday overseas due to COVID-19 (37 per cent).
  • The top five benefits Kiwis are looking for in domestic travel insurance are travel delay/cancellation cover (29 per cent), theft or loss of luggage (22 per cent), medical (13 percent) and rental vehicle excess cover (6 per cent).
  • 75 per cent of New Zealanders are considering travelling within New Zealand in the next 12 months. Over a quarter (28 per cent) of New Zealanders cancelled a booked international holiday due to COVID-19. Half of them (50 per cent) are planning on replacing it with a holiday in New Zealand within the next 6-12 months.


*Calculation based on:

  • $94.50 – Non-member rate with two adults aged 35 years-old and two dependent children, seven days cover ($100 excess selected).
  • $89.78 – Southern Cross member rate with two adults aged 35 years-old and two dependent children, seven days cover ($100 excess selected).

Note: SCTI does not charge an excess under its rental vehicle excess benefit.

Note: credit card charge applies so price will increase at check out.

1 SCTI travel trends research (December 2019) – developed by market research agency Perceptive
2 Omnibus research commissioned by SCTI (June 2020) – developed by market research agency Perceptive