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Last week, economists at Bank of America Global Research flagged the massive surge in spending on airlines the firm is seeing from its Bank of America cardholders who are most likely to be vaccinated. According to the company’s research, U.S. consumers between ages 73 – 92 have dramatically ramped up their airline spending after COVID-19 vaccines became available, a sign of how quickly consumer habits are likely to change once people feel safe to resume a wide range of activities.
The firm said that “traditionalists (aged 73 – 92)” spending is now four times the level in June 2020. The report adds, “We do not see the same [spending] pattern for lodging which may suggest that traditionalists are travelling to see family rather than take vacations.”
In Canada, in spite of the mandatory three-day hotel quarantine upon arrival at international airports in four cities recently introduced by the Federal Government, some Canadian snowbirds are still chartering private planes to head south to Florida or Arizona either to get vaccinated earlier or to enjoy the warmer weather. According to CTV News, both Florida and Arizona allow non-resident snowbirds to receive the vaccine as local residents of the same age and health category.
Momentum Jets, a company which charters private jets, has recently started selling individual seats on them amidst a spike in demand from snowbirds looking to travel south. A company spokesperson said that a seat on a private jet can cost from $2,500 to $4,000, depending on the size of the aircraft. As to whether the mandatory three-day hotel quarantine would be a deterrent, affluent seniors are either willing to pay at their own expense or just simply stay south until May or June when the current restrictions might ease.
Even for those who are not currently travelling, they might be itching to travel again with the promising vaccine news and doing the planning now. Travel agencies are beginning to see pent-up demand. People are tired of being at home and they want something to look forward to. Some are looking into booking travel in the fall or even planning for next year.
According to Kendra Thornton, owner of the travel agency Royal Travel and Tours in Chicago, one reason for a positive outlook is that airfares are really low right now, and many airlines are dropping change fees and penalties, making it easier for would-be travellers to book without fearing they’ll lose money if they need to change their plans.
NPR.org reported that according to a recent survey by the American Society of Travel Advisors, 87 percent of Americans plan to travel this summer, but where they will travel to and how they get there may be influenced by the availability of COVID-19 vaccines.
With recent promising news of vaccine delivery from the Federal Government, the Canadian travel industry is elated as well. “Any steps towards opening borders, building traveller confidence, and facilitating the movement of people across the country and around the world will be welcomed by our industry,” said the President and CEO of the Tourism Industry Association of Ontario.
Another Canadian travel agency Intrepid Travel said that after news of available vaccines broke, searches on its website jumped 24 percent compared to last year’s numbers.
The news is even more promising in the U.S. given their faster pace of vaccination and Joe Biden’s latest promise that there will be sufficient supply for all Americans by the end of May. According to Vogue magazine, a survey done by luxury travel company Virtuoso found that 60 percent of respondents planned to take a trip by Labour Day, and travel booking apps like Hopper are seeing a three-digit-percent increase in seasonal searches. Meanwhile, the U.S. Transportation Security Administration (TSA) is preparing itself for the anticipated boom. Recently, it announced a nationwide recruitment effort to hire 6,000 new employees by summer’s start.
However, boomers and seniors should come to realize that life will never be the same even when most people of their own age cohort have been vaccinated. Face masks and social distancing will continue to be in place for a long time to come until the entire world has achieved herd immunity. In addition to vaccine passports, COVID-19 insurance policies will become a vacation staple as well.
According to Reuters, more than a dozen countries from Aruba to Thailand require COVID-19 coverage for visitors, with Jordan the latest to consider such protections. The market for all types of COVID-19 travel coverage is estimated to be between USD$30 billion to USD$40 billion a year, according to travel insurance consultant Robyn Ingle, with companies like AXA and AIG underwriting protection.
COVID-19 insurance benefits typically cover treatment up to USD$100,000, and could include coronavirus testing costs and services like evacuation or local burial or cremation. These benefits, introduced by insurers in mid-2020, are sold either as add-ons or as separate policies with coverage for illness or quarantine.
Insurance experts say that as more countries require COVID-19 coverage, travellers are now more likely to insure their trips. A travel insurance plan that includes trip protection, medical expense coverage for COVID-19, and protection for baggage and personal effects typically costs four percent to eight percent of the dollar value of the trip.
Some countries have mandated traveller insurance for incoming visitors – either by including it in their entry or visa fees or by requiring proof of coverage, said Canadian insurer World Nomads.
Don’t expect this to go away soon even though you and your travel companions may have been vaccinated. Taleb Rifai, former secretary general of the UN’s World Tourism Organization, said he expects countries will continue requiring coverage as the vaccines will take years to roll out globally. In other words, don’t leave home without it.