The limitations of travel insurance: Why employers should consider additional protection

A business travel insurance, also commonly known as corporate travel policies, is one way an employer can protect and help its employees during business trips. Insurance is a fundamental prerequisite for employers to meet their Duty of care. Still, a major concern with insurance is its reactive nature, emphasizing the need for a proactive solution as well, such as Travel Risk Management (TRM). Focusing on proactive policies allows organizations to avoid unnecessary risks like accidents, dangerous situations, and other mishaps.

The travel insurance works like personal travel insurance, except in this instance, the employer is the policyholder. Travel insurances are often a part of organizations’ Duty of care to protect their employees. In fact, according to a study by the GBTA (Global Business Travel Association), 95% of the participating travel professionals consider travel insurance and assistance service for employees to be important for international travel. 

Although it is good to have it in place, travel insurance alone is not sufficient enough for full-scale safekeeping. While it offers valuable protection, it can also give a false sense of security as it cannot minimize potential risks before they occur. Thus, having only travel insurance is an inadequate solution and additional tools and actions must be enforced to have a comprehensive Duty of care solution. 


It is hard to find travel insurance that covers exactly everything and every potential scenario. Insurance lacks the ability to detect threats in advance, risk prevention, and immediate response during emergencies. Therefore, employers must provide additional care for full support and take responsibility. 

Here are three reasons why it is not enough for employers to only offer travel insurance to their business travelers as protection: 

1. Must conduct all pre-trip research in-house

Business travelers only supported through travel insurance are most often required to conduct pre-trip research about the destination themselves. This involves, for example, figuring out and keeping up to date about the safety conditions of the travel destination, education on rules and regulations, and identifying any customs to which one may need to adapt to. Furthermore, there is also a great responsibility on the traveler to be aware of and familiar with the procedures that follow a possible incident during the trip, which requires solid preparatory work.

2. Limited coverage

Travel insurances tend to focus on two main coverage areas. The first one is medical emergencies. The second focus area is often traveling-related problems, such as trip cancellations, delays, and lost luggage. However, standard travel insurance does not cover incidents like natural disasters, civil unrest, political conflicts, chemical accidents, kidnappings, physical threats, robberies, hotel burglaries, and so on

3. Reimbursement model

Many travel insurances follow a reimbursement-based model. In practice, this means that the traveler must cover urgent expenses with private funds when an incident occurs during a trip. The traveler, alternatively, the employer, can, at a later date, create an insurance claim to get a reimbursement. Thus, this model requires that the traveler, as a private person, will have direct access to (potentially) a large sum of money. 


These issues can be solved by implementing an adequate Travel Risk Management (TRM) solution. To avoid only offering employees reactive support (travel insurance), employers can supplement with a TRM solution, which then adds proactive risk management. A good TRM solution will be prepopulated with information about the traveler and the upcoming trip, and thus can prepare the traveler with all the necessary information. Furthermore, a good TRM solution uses real-time risk intelligence, creating optimal conditions for instant help throughout the entire trip. Through the combination of reactive and proactive instruments, the employer can manage a greater variety of risks, which addresses the problem of limited coverage in travel insurance. 

With the right technology and medical- and security assistance providers, organizations can tackle in-house research issues before business trips, as data-driven risk intelligence usually is part of TRM solutions. Having a TRM setup means a decreased demand for the lone business traveler during a trip, as other parties exclusively will supply the correct information and manage procedures. This way, the issue with the reimbursement model is also solved.  


There is a clear gap between business travel insurance and TRM, where employers must broaden their perspective on protecting their most valuable resources, their people. Based on the abovementioned problems, it is clear that only having travel insurance for traveling employees is insufficient. In conclusion, for organizations to be able to claim that it supports Duty of care, it is not enough to have only travel insurance. Evidently, they need to add a TRM solution to be able to mitigate or eliminate risks proactively. 

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