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Allianz reviews travel cover as tourism reels

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Insurers are re-evaluating their travel insurance policies in the wake of unprecedented government restrictions aimed at slowing the spread of coronavirus.

Allianz will give an update on its travel cover early this week after RACV Insurance suspended sales of new insurance policies for travel, and Cover-More froze Australian and New Zealand sales of its Cancel for Any Reason (CFAR) product.

An Allianz spokesperson told insuranceNEWS.com.au that “the status of new travel insurance sales is currently under review” and an announcement will be made within days.

Australians have been advised not to travel and to return home if overseas, and no non-resident visitors are being allowed into the country.

The downturn in global travel is expected to have flow-on effects and an acute impact is expected to hit premium volumes in Australia’s $1.2 billion travel insurance industry.

RACV Insurance is temporarily suspending the sale of new travel insurance policies as a result of the Government’s unprecedented Level 4 (the top level) advice to not travel offshore. The status of travel insurance sales will continue to be reviewed in line with Department of Health advice, it says.

“While this measure may be an inconvenience, it is aimed at ensuring we continue to put member and guest health and safety at the forefront of everything we do,” said a statement from RACV, which had already closed spas, fitness centres, pools and saunas and squash courts at its clubs and resorts and limited the capacity of dining and bar venues.

Most of its staff are now working remotely.

The air travel sector is reeling, with Qantas standing down 20,000 workers – two-thirds of its staff – after suspending all international flights and slashing domestic capacity amid a collapse in global travel. At least five UK insurers have suspended travel insurance sales.

Insurer contact centres are experiencing large call volumes from travellers calling to check whether coverage is available for COVID-19 while the Federal Government’s Smartraveller website warns that anyone going ahead with travel plans may find their travel insurance policy voided.