Analyst Mintel has predicted travel insurance premiums will rise by up to 30% by 2006.
The company also said it expects the travel insurance market to rise in value from £574m in 2002 to £698m in 2006.
The growth would stem largely from premium increases - which are likely due to lessening competition. This follows rising claims bills forcing several major insurers to exit the market.
Financial consultant Sarah Hitchcock said: "Fewer suppliers will inevitably result in price increases. In addition, insurance costs arising from World Trade Centre events, which all travel insurers will have to pay, are likely to be passed on in increased premiums."
Market growth is also deemed likely by Mintel because uncertainty about travelling post-WTC is expected to increase the number of travellers who take out insurance.
Travel cover is already a successful non-essential insurance, with 86% of British travellers taking it out each year.
