For the first time, the United States is no longer the top winter destination for Canadian travellers – and that shift is reshaping the risk landscape travel insurers need to plan for in 2026, according to Allianz Canada.
"When we looked [at the data] between February and June, we saw a huge decline in outbound travel," said Kyle Sparkman (pictured), managing director and head of Allianz in Canada. Follow-up surveys showed "the US was really a destination that people were avoiding."
Allianz’s latest destination analysis now suggests that trend will persist through the coming winter. Sparkman said that for the first time in the company's data, "the US is not the number one travel destination for Canadian travellers." Instead, he expects Mexico, the Caribbean and the northern part of South America to capture more of the market, with Europe, Asia and Oceania also picking up share.
The company’s destination‑based analysis found that travel to the US is down by roughly 20%–28%, a trend Sparkman expects to continue through the winter months.
"The benefactors of that will be Caribbean, Mexico, South America, and Europe primarily," he said.
Sparkman said one of the most important lessons of the past five years for travel insurers is simple: "expect the unexpected." The sector is now conditioned to look beyond traditional medical events and think in terms of overlapping shocks.
On the health side, he said Allianz is "hopeful that this bad seasonal flu that's going around Canada is not going to have a major impact on international flows of people," but the company is watching closely. Allianz invests heavily in clinical capacity "having doctors and nurses in every place Canadians will travel," he said, giving it more real-time visibility on local trends than it had pre-COVID.
Extreme weather is another focus. Recent hurricanes in Jamaica, for example, have had a direct impact on hotel inventory at exactly the moment when Canadians are shifting away from US destinations and looking for “sun and fun” options.
"When you have inventory problems like that, that could also be a shock that you have to be aware of," Sparkman said. He pointed to "really good news" about how much some properties have invested to be ready for the winter season, but warned that consumers and brokers still need to "look into their products" and understand how coverage responds if a resort is damaged or closed.
Geopolitical risk remains a wildcard. Sparkman said Allianz expects "geopolitical uncertainty to remain unpredictable," with interruptions and cancellations pushing trip coverage, not just medical, higher up the priority list. Some Canadians may prefer what they perceive as safer destinations, but that does not eliminate the uncertainties within those markets.
Despite rising intent to travel, Sparkman stressed that affordability is still a brake for many households. "What we have seen is many people are saying they still can't afford it," he said, pointing to a weak Canadian dollar and pockets of economic uncertainty.
That tension is feeding two patterns: more careful destination choice, and a continued role for domestic travel even in months that were once dominated by US snowbird traffic. Canada‑to‑Canada trips fall from summer peaks but remain significant.
"We think even through winter months, which is atypical, there will continue to be a bit more domestic travel than usual," he said, before adding a reminder that "you need to think about travel insurance coverage, even for domestic travel." Medical coverage, inter‑provincial health‑care gaps, trip disruption and baggage issues do not vanish just because the flight is between Canadian cities.
Snowbirds, meanwhile, are not staying home; they are simply going elsewhere. Sparkman said some older travellers may be rethinking traditional long Florida stays, opting instead for "three weeks in Costa Rica versus a month in Florida," or choosing Caribbean and Latin American destinations over US sun states.
The way travellers research and book is also evolving quickly. Sparkman said Allianz is watching "how consumers are informed," noting that "people are using AI to build their trips. They're using AI to build their travel."
He argued that brokers and travel agents still have a role in that world. Human intermediaries, he said, "bring value that sometimes AI won't show you," particularly around where to go, what to watch for and how coverage actually works in practice.
Demographic patterns are shifting too. Younger Canadians are travelling more and "are still going to the US a bit more," even as overall US-bound numbers fall. Allianz’s Vacation Confidence survey also shows higher travel confidence among men and among people with higher education levels, including a growing appetite for “big trips” inspired by social media.
