The 2018 hurricane season officially begins June 1, and following last year's catastrophic season for parts of the U.S. and the Caribbean, travel insurers are experiencing increased interest in weather-related coverage and higher sales through the season, which ends on Nov. 30.
Part of what's driving sales is last year's triple whammy of hurricanes Harvey, Irma and Maria, but it also helps that researchers are predicting that this year's season will be above average in terms of the number of named and major storms.
"For the last few months, I've been saying that a lot of people have come into the market for the first time because of various external events, i.e., the hurricane season last year," said Stan Sandberg, co-founder of the insurance comparison site TravelInsurance.com. "A few years ago, the very global terrorist attacks in very popular tourist destinations, we felt that that was [also] a catalyst for bringing new people into the market."
Predictions of a "slightly above-average Atlantic hurricane season," with 14 named storms, were made recently by researchers at Colorado State University.
The researchers expect seven of the named storms to become hurricanes, meaning sustained winds of at least 74 miles per hour.
Additionally, the Colorado State researchers predicted that three of those seven storms will become major hurricanes, meaning they will rise to categories 3 through 5, with winds of 111 miles per hour or more.
This year's season is not expected to be as active as last year's, when a trio of destructive storms -- Harvey, Irma and Maria -- grew to categories 4, 5 and 5, respectively, at their peaks.
Those three storms triggered an onslaught of claims with travel insurers. For example, insurance comparison site Squaremouth's insurance provider, Tin Leg, saw 10 times the number of claims during the 2017 hurricane season compared with the 2016 season. Allianz received some 10,000 claims from disrupted travelers.
This year's hurricane season comes at a time when the insurance industry continues to experience repeated, year-over-year growth in sales.
"We never see a decrease in sales of travel insurance," said Carolyn Leckie, director of marketing for Squaremouth. "I think that travel insurance awareness is really always increasing. It's unfortunately because we have these situations that happen -- we have more terrorist attacks, we had that awful hurricane season last year -- and I think when things like that happen, it only raises awareness of travel insurance."
Sandberg said the first quarter of 2018 was a particularly healthy one for insurers, adding, "There's a ton of growth in the industry right now."
Year to date, Sandberg said, for travelers booking trips to the Caribbean from June through November, TravelInsurance.com has tracked year-over-year growth of 68% in insurance sales.
"Some of that is likely because of the hurricanes and the impact that they had last September," he said. "Some of that may also be organic growth or industry growth. Some of that is also likely a result of the business; our particular business continued to scale up."
Allianz has seen an increase of about 1% in policies sold for travel during hurricane season, translating to "potentially thousands of more customers," said director of communications Daniel Durazo.
Squaremouth has seen a 31% increase in people purchasing travel insurance for the 2018 hurricane season.
Most insurance policies carry weather-related insurance, so it can be difficult to determine exactly how much of those increases are from travelers specifically looking to purchase coverage for hurricanes. That is especially true considering the continued growth that travel insurance sales have seen in recent years, but there are indicators that hurricanes are a driver behind at least some of the growth.
For example, Squaremouth has seen a 16% increase in travelers who are specifically searching for policies that include hurricane and weather coverage. InsureMyTrip is reporting that its insurance agents are expecting a 20% jump in call volume from travelers seeking coverage for hurricanes. Portions of TravelInsurance.com's website dedicated to hurricane-related topics have seen a 40% increase in visitors.
Generali Global Assistance's call centers are also seeing an uptick in calls related to hurricane season, according to COO James Sion.
"I would believe that our sales are on the increase," he said. "As people start to think about their summer vacations and into the early autumn season, hurricanes are prevalent. As they get more publicity in the newspapers, then it does lead people to buy more policies."
As the official start of the season grows nearer, headlines in consumer media about hurricane season -- especially about the Colorado State researchers' predictions of a slightly above-average season -- have begun to pop up. Sion said more articles will likely mean more interest in insurance.
"The more that this is covered in the media, I think the more aware individuals become, and then it does lead them to look to protection via travel insurance," Sion said. "We encourage everyone to buy their policies and coverages as soon as possible when they make their travel plans, because there are restrictions once a storm has been ... named. Then there are moratoriums put on the sale of policies during that period of time."
While each policy has specific rules, coverage generally begins if a flight or cruise is delayed for at least 12 to 48 hours; a hurricane warning or mandatory evacuation is issued for the city they're flying out of or their destination; or if their home is rendered uninhabitable. Cancel-for-any-reason insurance, as its name implies, enables travelers to cancel their trip regardless of the situation and get reimbursement, although it comes at a higher price.
A new policy covering storm reporting from the National Hurricane Center may also affect insurance policies this year, Sandberg said. The center will now issue potential tropical storm advisories. Sandberg said that will likely make the storm a known event, marking that as the date on which insurance can no longer be issued for that particular event.