Geopolitical Instability Shifts Canadian Travel Focus From US To Alternative Destinations

Published on December 4, 2025

In 2026, Canada’s tourism landscape is undergoing significant changes as geopolitical instability and rising travel costs, especially in the United States, shape Canadians’ vacation decisions. According to the 2026 Blue Cross Travel Study, Canadians are increasingly turning their backs on US travel and opting for smarter, budget-conscious alternatives. While the US may see a sharp decline in Canadian visitors, other destinations such as within Canada itself, the Caribbean, and Mexico are expected to gain ground.

Geopolitical Tensions Drive Canadians to Rethink US Travel

The study revealed that 76 percent of Canadians are now less likely to travel to the US in 2026, citing political tensions, trade issues, and unfavourable exchange rates as significant deterrents. This is a noticeable increase compared to the previous year, when only 47 percent of Canadians expressed the same concerns. Among the age groups, Baby Boomers are particularly reluctant to cross the border, with 54 percent cancelling all US travel plans for the year ahead. The geopolitical landscape, including growing uncertainty and evolving trade relations, is now the driving factor for many Canadians to reconsider their trips to the US.

AI and Technology Transforming Travel Plans

Despite avoiding US travel, Canadians are still determined to explore the world. Many are turning to AI tools and travel technology to make smarter and more cost-effective decisions. The 2026 study showed that nearly half (49 percent) of Canadian travellers now rely on artificial intelligence to plan their trips. AI is used for comparing prices, finding optimal destinations, and building flexible itineraries that can accommodate shifting plans and rising costs.

This trend is most pronounced among younger travellers, with 70 percent of Gen Z and 63 percent of Millennials utilising AI in their travel planning. However, even older generations are adopting these tools, with 42 percent of Gen X and 23 percent of Baby Boomers reporting increased use of AI-powered platforms for vacation planning.

The rise of AI is helping Canadian travellers navigate the challenges posed by inflation and international tensions. These tools allow users to assess various factors such as price fluctuations, destination safety, and real-time recommendations based on up-to-date information.

New Destinations Emerge as Canada Reroutes Its Tourism Efforts

While US destinations have been sidelined, many Canadians are redirecting their travel plans towards destinations within Canada and other international hotspots. According to the study, 95 percent of Canadians avoiding US travel still intend to explore new locales, with 68 percent planning trips within Canada. This shift towards domestic travel comes as Canadians seek to avoid the uncertainties tied to international trips while still satisfying their wanderlust.

Beyond Canada, destinations in the Caribbean (38 percent) and Mexico (38 percent) are seeing an uptick in interest, with 35 percent of Canadians opting for overseas travel. The Caribbean’s sunny resorts and Mexico’s vibrant cultural offerings present appealing alternatives to the US, with its uncertain political climate and rising travel costs.

The Importance of Travel Insurance and Protection

As Canadians adapt to a changing travel landscape, travel insurance remains a critical consideration in their planning process. With rising health and emergency medical costs, 86 percent of Canadians now have some form of travel insurance. This includes plans purchased directly or through workplace policies and credit cards, highlighting how financial protection plays a crucial role in responsible trip planning.

Particularly among younger Canadians, travel insurance is becoming a standard part of trip planning. With concerns about medical emergencies abroad, 42 percent of Gen Z and 47 percent of Millennials now view travel insurance as essential, compared to 39 percent and 43 percent respectively the previous year. Awareness of the high costs of overseas medical care is a significant driver, with 83 percent of Canadians acknowledging the potential for substantial expenses if an emergency situation arises while travelling.

Adapting to New Travel Realities

The ongoing shift in Canadian travel behaviour reflects the resilience of travellers in adapting to a changing world. While global instability and economic challenges may be influencing where Canadians choose to visit, their commitment to travel remains unchanged. With the help of AI-powered tools, Canadians are making smarter decisions that allow them to explore new destinations without compromising their financial security or peace of mind.

As the travel landscape continues to evolve, Canadians are proving that while geopolitical tensions may deter them from certain destinations, their passion for exploring the world remains stronger than ever. By relying on technology and prioritising responsible travel, they are navigating the complexities of the modern tourism environment, ready to discover new opportunities in 2026.