Exclusive: 11% more opt for premium travel insurance after Mapfre adds parametric cover

By Henry Gale

May 21 - (The Insurer) - Mapfre's Mawdy unit in Ireland recorded a 21% increase in the average premium of its travel insurance policies last year, according to a source close to the companies, as customers opted for higher-tier products that included a new automatic flight disruption cover.

The results of a study into the commercial outcomes of Mawdy's first year providing parametric travel insurance with Blink Parametric are set to be announced today, the source said.

In recent years, more travel insurance companies have integrated parametric covers, which trigger automatic claims for predefined events such as flight delays, within their product offerings. These have been seen as ways to improve customer experience and process simple claims more efficiently, but this study suggests they can also increase insurers' revenue.

Mawdy has offered parametric coverage as standard on its InsureandGo Ireland brand's Gold and Platinum policies since January 2024. Policyholders are notified automatically and offered a choice between access to an airport lounge and a cash payout if a registered flight is delayed for more than three hours or cancelled.

Within 12 months, Mawdy saw an 11% increase in the take-up of its premium products, while the average premium of policies rose by 21%. Customer satisfaction with the parametric cover was 90%, according to a survey of more than 3,000 claimants, with net promoter scores of 43 for airport lounge and 78 for cash payouts.

Mawdy has now rolled out the parametric cover to other travel insurance brands it underwrites in Ireland, while it is also making the coverage available in Sub-Saharan Africa.

Blink Parametric's Sid Mouncey, said: "Feedback is greatly valued at Blink and we are immensely grateful to Mawdy for their willingness to share not only the insights on our collaboration but the measurable results that speak volumes."

Mouncey added that the complexity of the partnership across different countries and brands showed the flexibility of Blink's parametric solutions.

Since customers need to register their flights in advance for the parametric cover, it has also provided Mawdy with more information on their policyholders' travel. Previously, the insurer did not ask customers which countries they were travelling to, and in the case of annual policies did not know how many trips they would take in a year.

Declan Murphy, Mawdy's head of commercial, said: "Our learnings from the data sets are going to enable us to price and market our products more effectively and tailor our offerings based on insights on everything from top departing airports, airlines and flight times to seasonal trends and popular destinations."