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Affinity aviation: Customized aviation insurance for airlines and travellers

WTW Affinity designs, delivers, and manages customized travel insurance programs that align with market trends and meet evolving customer needs. Creating revenue, enhancing loyalty, and controlling costs.

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Overview: Affinity connect

Ancillary revenues allow airlines to diversify income sources, enhance the passenger experience through customization, and leverage technology for efficient sales. Ancillary services attract customers with personalized offerings and help low-cost carriers maintain competitiveness with lower ticket prices. Ultimately, ancillary revenues are integral to the financial sustainability and resilience of airlines in a dynamic and competitive industry.

$102B Ancillary revenue of Airlines 2022

15% Ancillary share of global airline revenue

141% Growth of Ancillary revenue 2013-2022

Source: OAG

Embedding customized travel insurance

Post-COVID, the travel insurance market has evolved with more comprehensive coverage options, leading to higher premiums.

Many airlines are reviewing their Travel Insurance offering to improve insurance offerings to customers and conversion rates.

Insurance can contribute to these revenues:

Travel

Travel

Luggage

Luggage

Flight Cancellation

Flight Cancellation

Others

Others

WTW can enhance our clients’ ancillary revenues by implementing the following approach:

✓ Tailoring new innovative Affinity programs

✓ Benefit reinsurance negotiations

✓ Engaging Local insurers

✓ Management on enhanced technology

Design – deliver – manage

EU261: Flight cancellation and delay protection

EU261 and similar regulations are major issues for many airlines.

EU261 increases volatility into financial results:

  1. Airlines have tight margins, especially high frequency short haul operators
  2. A small number of delays could crush smaller airlines financial results

Balance sheet liabilities:

  1. Time limits to claim are up to 10 years and not everyone will claim straight away
  2. Many airlines must hold a liability on their balance sheet to cover this – ROIC is a key measure of financial performance for airlines

Source: European Regions Airline Association

Flight delay according to EU261
Flight delay according to EU261
Flight cancellation according to EU261
Flight cancellation according to EU261

WTW trip delay product focuses on creating a seamless journey for the airline. Key benefits include:

✓ Reduction in balance sheet volatility caused by compensation payments

✓ Increased passenger satisfaction with a reduction in claim handling time

✓ Integrated technology platform delivers a seamless passenger experience

✓ Ability to generate revenue and deliver cost savings to the airline

The suite of solutions can be expanded beyond just an EU261 Solution.

Disclaimer

For details of the Affinity solutions and services available in your country, please speak with your local Affinity team contact.

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