A new survey by Allianz Partners reveals a significant drop in the number of UK residents planning domestic holidays this summer, as rising costs and economic pressures reshape travel habits.
According to the research, 77% of Britons intend to take a summer holiday in 2025—down from 85% in 2024. The decline is largely driven by reduced demand for UK-based travel, with only 45% of respondents opting for domestic holidays this year, compared to 57% last year. This represents a notable 21% drop.
In contrast, the proportion of travellers planning trips abroad has remained steady at 49%.
Cost of Living Squeeze
Financial concerns appear to be the main factor influencing travel decisions. Of those not planning a holiday this year, 46% cited a lack of funds, while 22% believe travel has simply become too expensive.
Despite these concerns, those who are travelling are planning to spend more. The average household holiday expenditure is expected to rise to £2,348, an increase of £425 from 2024.
Europe continues to be the most popular destination, attracting 37% of UK adults, followed by North America (8%) and Asia (6%).
Environmental and Geopolitical Concerns
Beyond financial factors, environmental and geopolitical issues are increasingly shaping travel behaviour. Nearly half (46%) of British travellers expressed concern about extreme weather events such as heatwaves, wildfires, and flooding.
Environmental considerations now influence travel decisions for 59% of respondents, a 7-percentage-point increase compared to last year.
Geopolitical instability is also a growing concern. Forty-five percent of travellers reported unease over global tensions, while 47% have reconsidered travel destinations due to tighter border controls. A further 44% cited worries over safety, crime, and civil unrest.
Consumers Prioritise Holidays, Make Sacrifices
Despite economic challenges, summer holidays remain a priority for many. Nearly six in 10 (58%) plan to cut back on discretionary spending—such as dining out, cultural events, and gym memberships—in order to afford their trips. More than half (54%) said they will postpone major purchases to prioritise travel.
Shift Toward Sustainable and Authentic Travel
The survey also highlights a growing preference for meaningful and sustainable travel. Concerns about overtourism were cited by 20% of non-travellers as a reason for staying home.
A strong majority (72%) of UK holidaymakers said it was important that their spending benefits local communities in the destinations they visit. Many are actively seeking off-the-beaten-path locations that align with environmentally conscious values.
Travel Insurance Remains a Priority
The research also found that travel insurance is a key consideration for British holidaymakers. Thirty-five percent of respondents said they would purchase single-trip cover, while 33% opt for annual multi-trip policies. Another 16% rely on travel insurance provided through their bank or credit card.
Medical coverage remains the primary motivator, with 59% citing the need for protection against illness and repatriation costs.
Expert Commentary
Commenting on the findings, Andrew Tolman, Head of Travel at Allianz Partners UK & Ireland, said:
“It’s evident that while Brits still prioritise summer holidays, the rising costs are impacting their choices, particularly for domestic trips. With increasing concerns over extreme weather and geopolitical stability, travellers are turning to insurance to safeguard against unexpected medical expenses and emergencies abroad.”
