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Travel insurance specialist Acumus Travel Solutions is targeting DIY holidaymakers with revamped and rebranded websites for low cost airlines including Ryanair and Jet 2, to maximise after-sales insurance revenue.

Research shows up to one in five independent travellers forgets insurance. This area of concern for DIY holidaymakers, also pinpoints potential income growth for operators.

Says Acumus Group Marketing Co-ordinator, Gary O’Brien: “We are encouraging customers who fail to take insurance during the integrated flight sales process to visit new external websites with a much closer look and feel to the original site. To maximise revenue at every customer touch point, we make the customer journey more seamless leveraging off the strong airline brands.

“DIY travellers tend to source elements of the holiday from different suppliers. Pitfalls occur when one component goes awry and their hotel or holiday transfer is charged despite the fact they were waiting for a flight at T5, for example. DIY is okay for the savvy traveller who knows the risks and takes out appropriate insurance," says O’Brien. “They can be reassured when their insurance is clearly branded as belonging to their chosen principal.”

Independent trippers most affected tend to be broadsheet readers and ABC1 family members whose relative affluence makes them among the most likely to travel to far-flung locations. Overlooking the essential insurance element is therefore not cost related; simple forgetfulness is understood to be the main concern.

Acumus Insurance Solutions, part of the UKU Group, has paid an undisclosed sum to acquire Bristol and Exeter-based Fortress Underwriting.

Acumus Managing Director, John Bibby, says: “We are delighted to have bought this well established and highly respected specialist home insurer, which has been in this market for over 20 years. This is a good fit with our existing network, with potential to build on existing strong relationships to introduce our product range of buy-to-let, travel, wedding and other specialist risk products to hundreds of new brokers.”

Fortress Underwriting has made household insurance its priority for more than ten years, and boasts a customer base of 15,000 clients and a nationwide network of 400 insurance brokers and agents. Its insurance products cover over £3 billion in property and contents in the UK – providing a range of options from those designed specifically for young professionals and first time buyers, through to high net-worth policies.

“The deal secures a bright future for the Fortress brand with significant investment planned in existing and new products and systems. This will provide us with the platform to offer a wide range of products and services to a broader range of clients ” says John Bibby.

A leading UK provider of travel insurance, Acumus Insurance Solutions Limited, is in discussions with low-cost airlines and other travel operators, following the development of major new online capability to tap into the $4 billion pan European insurance market. Any deal would provide travel insurance and local language sites to European customers via the web.

Using their experience developing web-based solutions with household names including Jet2.com, Ryanair, P&O Ferries and Travel City Direct, Acumus has devised the unique end-to-end offer to pick up inbound insurance business from Europe, to add to its existing business capacity in the outbound marketplace.

Says Acumus Managing Director, John Bibby: “We are proud to have developed the technology, combined with online marketing to help air operators in the UK, Europe and the USA fight for their share of this lucrative area of the industry, which can add so much profitability in terms of ancillary revenue. We offer intelligent products, fulfilment and routes to market to help companies capitalise on potential customer revenue.

“The offer is unique because we are talking about integrating a wide range of marketing techniques and tools, in bespoke website models, backed with sites in multiple languages and the power to trade in multiple currencies. We will also provide support services such as assistance companies and claims locally in each country. And it is our ability to provide the whole gamut of services for travel companies, from start to finish, that puts Acumus in a rare position to develop high-powered technology and distribution methods for wholesale insurance across the travel and tourism industry.”

The fast-growing online insurance company explains that its new capacity dramatically changes the performance and overall profitability of the travel trade, by providing a strong stream of ancillary revenue.

“In a time of increasingly tight markets, we are opening up new products for a number of major businesses, keeping them in pole position against the competition,” says John Bibby.

Richard Bodin, Business Director of Jet2.com, says: “We are in discussions with Acumus about how we can utilise the new Pan-European scheme to maximise take-up of travel insurance across our customer base. This could be an exciting development to allow up to offer insurance to a previously untapped inbound travel market. “

While the high street remains the biggest distribution channel for travel insurance across the continent, research shows Europeans are gradually adopting remote channels such as the net or phone to research and buy independently. This offers a way of avoiding excessive costs as insurance cover from travel agents and tour operators can be double the price of the most competitive insurers.

Changes to the Financial Services Authority (FSA) insurance regulations open up the more than £150bn UK insurance market to the travel trade, says a leading UK online travel insurer.
Managing Director of Acumus Travel Solutions, John Bibby, says: “Authorisation allows a firm to sell every kind of insurance. Just as large supermarket chains are white-labelling financial and insurance products, travel firms will become eligible to tap into an insurance treasure trove that could grow, simply by being more accessible.

“Only a minority of the more than six thousand UK travel agencies have grasped the implications. The winners will capitalise on trading opportunities that are unprecedented.”

John Bibby cites Thomas Cook, which has been regulated for some time, as being able to harness the power of its strong and trusted brand across the insurance marketplace. This opens up its extensive customer-base to options such as home emergency cover while away or valuables cover while en route; what is actually two weeks’ of holiday medical insurance could extend to an annual private medical policy; perhaps a honeymooner might like wedding insurance or pet insurance could be offered while the pooch is in kennels.

Acumus partners with Ryanair, which has already started providing lucrative car and home insurance via its website to its over 30 million-passengers.

“In future, before passengers disembark from their aircraft they could have signed up for coffee, an insurance policy and a credit card scheme,” says John Bibby.

However, mid-size travel groups, unable to commit to major infrastructure investment to meet the new rules, will require help to becoming an Appointed Representative (AR) with an approved insurer.

“The travel insurance industry is full of providers who are more than happy to take their share of the spoils without ever really committing to a full partnership,” says Acumus’ MD, John Bibby.

“In a highly competitive marketplace, agents are in a strong position to ask more of these companies – rather than basing decisions purely on price.”

The small number of systems coming on stream should be checked to cover the IT/Web Solutions, the insurance package itself, training, audit, referral, implementation and marketing plus an analysis of growth opportunities.

Acumus’ own end-to-end offer has been devised working with household names including Jet 2, Ryanair, P&O Ferries and Travel City Direct. The insurer’s target is well-established medium positioned companies with brand recognition and a loyal, but not necessary large customer base.

“These firms can see the potential of FSA authorisation, but don’t wish to divert resources from their core business selling travel products,” says Bibby. “We take on the responsibility of compliance - our license is at risk, not the agents’, in the event of breach.”

The family business earning less than £10k a year from insurance may wonder whether the license fee is commercially viable and if they should stop selling insurance altogether, losing an entire income stream.

These can become an "introducer", referring customers by giving out leaflets or website details. The principal will provide all the advice, service and administration and revenue is straight commission to the bottom line. Margins are reduced, however. Sales may be lost through transfer to the principal and the inability to cross-sell or up-sell. And agents who helpfully give customers advice could be fined for breaching the rules.

The lost income will put pressure on tight margins for independent firms. Mergers, consolidation and closures may be in the offing.

Over 20 million people in Britain buy travel insurance each year and £260 million worth of travel insurance currently comes through the industry. The rules will be finalised in May or June and any firm ready to complete their FSA application by the end of September will gain a substantial discount on the license fee.