Rising cost of living impacts Australian travel plans

The report, commissioned by SCTI to better understand travel behaviours in Australia since the pandemic, found that Australians’ appetite for travel remains high – with nearly nine in 10 (87%) planning to travel either domestically or overseas in the next 12 months.

However, 37% Australians said they are less likely to travel interstate over the next 12 months due to the rising cost of living, while almost half (48%) said they are less likely to travel overseas for the same reason.

Moreover, more than eight in 10 (83%) Australians travelling over the next 12 months said they must reduce their travel costs due to the skyrocketing cost of living. Those who plan to travel but need to reduce their travel costs said they will book cheaper or budget accommodation (39%), take fewer trips (37%), or take a shorter trip (36%).

Rising cost of living’s impact on travel insurance industry

SCTI’s previous report showed that Australian travellers became more concerned about health and safety post-COVID-19, with 80% considering travel insurance a high priority for international travel, and 65% for domestic travel.

However, the travel insurer’s latest report found that one in 10 Australian travellers will not purchase travel insurance to save costs due to financial pressures brought by the rising cost of living, with millennials twice as likely as baby boomers to ditch travel insurance to reduce their travel costs.

“It’s unsurprising, following the lockdowns, that Australians still have a huge appetite to get out there and see the world,” SCTI CEO Jo McCauley said. “But the rising cost of living is impacting Australians across all areas, and travel is no exception, so it’s understandable Australians will be looking for ways to cut costs while still trying to make those trips happen.”

McCauley advises Australian travellers to take out travel insurance in the case of the unexpected.

“We’d encourage everyone to ensure they take out travel insurance regardless of where they’re travelling as it could end up saving you significantly in the case of the unexpected,” she said. “An air ambulance from Bali to Sydney can cost anywhere between $80,000 and $110,000, and not many people can afford a medical bill that size. It’s just not worth taking the risk.”