Global conflicts can have far-reaching effects on business travel. Even companies that do not send employees to the Middle East may experience disruptions when conflicts affect regional airspace and major aviation hubs. Understanding how these risks interact with corporate travel insurance is essential for businesses managing international travel programs.
Why the Conflict Matters for Corporate Travel?
Airspace disruption is one of the biggest hidden risks in global travel. During periods of conflict, large areas of Middle Eastern airspace can close quickly, forcing airlines to reroute or cancel flights.
Major hubs such as Dubai and Doha are critical transit points for Australians travelling to Europe and the UK. If these hubs experience disruption, travellers may face significant delays, cancellations, longer flight paths and reduced seat availability.
This highlights an important insight for businesses: travel disruption today is often caused by airspace restrictions rather than the safety of the destination itself. Many organisations overlook this exposure when assessing their travel risk.
What Corporate Travel Insurance Usually Covers?
Corporate travel insurance is designed to help businesses manage unexpected disruptions during travel.
Typical policies may include cover for:
• Trip cancellation or interruption if flights are cancelled or significantly delayed
• Additional accommodation or transport costs caused by travel disruption
• Overseas medical treatment and emergency evacuation
It is important to understand that travel insurance usually responds after airlines have applied refunds, rebooking or travel credits. Insurance generally covers additional costs that remain after airline obligations are fulfilled.
What Many Policies Do Not Cover?
One of the most common misunderstandings in travel insurance relates to war and conflict exclusions.
Most policies contain exclusions for losses that are directly caused by war or armed conflict. However, not all disruption during geopolitical events falls under these exclusions. Claims related to airline cancellations, delays or logistical disruption may still be covered depending on the policy wording.
Another common misconception is that businesses can cancel travel simply because geopolitical risk increases. Standard travel insurance policies do not include “cancel for any reason” cover.
The DFAT Advisory Issue
Government travel advisories can significantly impact travel insurance coverage.
Many insurers restrict or exclude cover if travellers enter destinations where the Australian Government’s DFAT advisory level is “Do Not Travel.”
However, if the advisory level changes after the trip has already begun, coverage may continue depending on the specific policy wording.
This is one of the most frequently misunderstood areas in corporate travel insurance, making it important for businesses to understand how their policy treats DFAT advisory changes.
What Businesses Should Check Right Now?
In periods of geopolitical uncertainty, businesses should review their travel insurance policies and confirm key protections.
Important checks include:
• Limits for travel delay and disruption expenses
• Whether the policy includes security or political evacuation cover
• How the policy responds if DFAT travel advice changes during a trip
These details can significantly affect how well a policy responds during major travel disruptions.
The Value of a Broker During Disruption
Travel insurance policies often contain complex wording, particularly when it comes to geopolitical risks, airspace disruption, and policy exclusions.
KBI helps businesses navigate these complexities by:
- Interpreting policy wording and explaining coverage limitations clearly
- Coordinating claims and assisting with insurer support services during disruptions
- Structuring travel insurance programs designed to respond to geopolitical and travel disruption risks
Working with KBI ensures businesses have clarity around their travel insurance coverage and support when unexpected disruptions occur
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Events such as the current Middle East conflict highlight why travel insurance should be viewed as a risk management tool rather than just an administrative purchase.
For businesses with employees travelling internationally, the right policy structure and expert guidance can make the difference between manageable disruption and significant financial loss.
Table of contents
| • What is Corporate Travel Insurance? • Why Do Businesses Need Corporate Travel Insurance? • The Benefits of Corporate Travel Insurance for Businesses • What Isn’t Covered? • No Insurance? No Entry – Nations Asking for Beyond Passports • How To Obtain Corporate Travel Insurance
|
Why Do Businesses Need Corporate Travel Insurance?
| Corporate Travel policies are often looked at as a ‘luxury’ rather than a necessity. When you look at overseas medical costs it is very quickly shown that this cover is not a luxury and a must for businesses that send employees on regular work travel. Here are a few examples:
• Healthcare costs in some countries such as Switzerland, Singapore, the United Arab Emirates, and the United States of America for expatriates and visitors can reach $3,000 to $50,000 a day at a hospital.
• Due to the COVID-19 pandemic, international air evacuation costs to Australia have skyrocketed to start from approximately $150,000+.
• An operation such as an appendectomy can cost between $20,000 – $30,000 in Japan. | Whilst medical costs are generally covered when travelling domestically in Australia under Medicare or Private Health there are still a few key reasons to consider Corporate Travel Insurance including some cancellation costs, baggage cover, car hire excess and that’s just to name a few. |
The Benefits of Corporate Travel Insurance for Businesses
There are a few benefits included in your corporate travel insurance policy such as: ➤ Hire Car Excess – Cover your collision damage excess, rather than paying the car hire company’s extra charge. ➤ 24/7 Emergency Contact – All insurers have a 24/7 contact line for emergencies which should be kept handy and made available to all employees. ➤ Alternative Employee Cover – If your employee is injured/becomes ill on a trip this benefit covers the cost of temporarily employing someone to fill the position of the injured/sick employee until they have recovered. ➤ Most policies extend to cover accompanying partners/spouses and children. | ➤ Corporate travel policies also allow you to declare and cover leisure trips; given that the policy covers predominately business trips. ➤ Personal/business effects can also be covered (check with your broker to ensure that the coverage meets the costs of luxury items). ➤ Electronic Equipment – Such as laptops/phones etc. (please note only a small limit is allowed which is usually around $5K dependent upon the insurer. Any specialised tools or business equipment will need to be covered under a separate policy, which your broker will be able to assist with). |
What Isn’t Covered?
| Common circumstances traditionally excluded from most Corporate Travel Insurance policies:
➤ Government-mandated lockdowns and border closures | You will note that insurers have adjusted their policies to address the health risks associated with travelling around COVID-19.
As specialist insurance brokers, we can access various insurers in the market that can potentially provide cover against some of the above. In principle, some exemptions can be made if your doctor or specialist clears you to travel, our team can then help find a policy that meets your requirements. |
No Insurance? No Entry – Nations Asking for Beyond Passports
| It is becoming more prominent for countries to require you to have travel insurance coverage as part of their entry requirements. This helps ensure that international travellers have enough coverage for unexpected medical bills or other related travel expenses. Therefore, ensuring that government services, medical services and other businesses are not left out of pocket by travellers not intending to pay the bill. | Singapore, Thailand and the UAE now require you to have travel insurance as part of their entry requirements. Travellers applying for a visa to visit European countries in the Schengen Area will also require proof of travel insurance.
Visit the Smart traveller website for more information: https://www.smartraveller.gov.au/ |
How To Obtain Corporate Travel Insurance
| Contact your Broker who will have access to a range of insurance providers. You will need to complete a Travel Declaration, where you will declare the trips you have planned for the upcoming year (business and leisure). Policies are annual however the premium is based on the number of trips declared.
If you need to cover any additional trips in the policy period you can contact your broker who will be able to add them (additional premiums apply). | Should you need more information on Corporate Travel Insurance, please contact the KBI team on 1300 907 344 or email info@kbigroup.com.au |
We are a specialist insurance brokerage with an emphasis on adding value to our clients by helping them make an informed decision. Our approach combines that of an insurance broker and consultant, where we focus on providing expert advice to our clients while customising their insurance program and risk management solutions.
Since starting in 2013, KBI is constantly growing and becoming a leader in the Australian market. Our primary point of difference is that we don’t try to be all things to all people. We work in niche areas, where we can tailor an offering, advice and broker support to meet the specific area’s needs.
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