ST. PETERSBURG, Fla., May 21, 2025 -- While economic uncertainty and volatility have disrupted travel and forced most travelers to adjust or second guess their plans, luxury travelers have remained unphased. As the post-pandemic luxury travel surge continues to hold, airlines are focused on capturing a larger share of the premium travel market.
Squaremouth, the nation's largest travel insurance comparison service, has released new research highlighting how and why luxury travelers have remained impervious to economic conditions, and explains how travel insurance can help the average traveler during turbulent economic times.
Airlines Adjust to the Steady Demand from Luxury Fliers
According to Squaremouth's latest research, the number of travelers taking trips with a trip cost over $20,000 (representing the premium passenger) has increased 3% year-over-year. Comparatively, the number of travelers taking trips around $5,000 (representing the average traveler) has decreased by 10% year-over-year.
Airlines are taking note. In recent months, the "Big 3" airlines have all unveiled a host of new offerings geared towards the premium passenger:
- Delta has elevated its in-flight dining and partnered with Shake Shack for dining on select first class flights. Delta also debuted new, exclusive Delta One Lounges at both JFK and LAX and has said it expects premium ticket revenue to surpass main cabin revenue by 2027.
- United has recently opened its latest enhanced Polaris Lounge at Chicago O'Hare, introduced upgraded Polaris studio seating, announced next-generation Z4 aircraft, and enhanced Starlink Wi-Fi.
- American has recently unveiled its new Flagship Suites on the 787-9 aircraft and new lounges in Philadelphia. The airline is also prioritizing important European vacation routes and has expanded service to luxury destinations like Edinburgh, Milan, Copenhagen, Madrid and Naples.
Most Travelers Are Impacted by Volatility - Here's How Travel Insurance Can Help
While premium passengers remain largely unaffected, the average traveler is feeling the impact of market volatility. As tariffs and workforce instability contribute to uncertainty, most travelers demand flexibility in travel.
In uncertain times, a Cancel For Any Reason (CFAR) policy offers the highest level of flexibility and peace of mind for travelers. CFAR coverage allows travelers to cancel their trips without needing to state a reason why. For example, it can cover travelers who cancel because they no longer want to spend the money on their trip amidst a volatile market.
CFAR plans will reimburse a majority of the total trip cost if a traveler needs to cancel, up to 75%. On average, this coverage adds an extra 8% to the trip cost.
About Squaremouth
Squaremouth is a trusted name in the travel insurance industry offering comprehensive, transparent, and competitive coverage to travelers for 20 years through its digital platform. With the largest portfolio of travel insurance carriers and products in the U.S., Squaremouth has insured over 4 million clients.
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