Travel from India to long-haul international destinations such as the USA, Europe, and West Asian countries has experienced a noticeable decline this summer compared to the same period last year. This trend is attributed to ongoing geopolitical tensions, airspace disruptions, and uncertainty, according to insurance companies. Even the United Arab Emirates (UAE), traditionally a strong summer travel market for Indians, is witnessing fewer travellers amid concerns over regional instability. Data from Policybazaar indicates that year-on-year bookings to the UAE dropped by over 70% this summer.
Shift in Outbound Travel Patterns
Manas Kapoor, head of travel insurance at Policybazaar, explained to TOI: “This summer, we have been witnessing a noticeable shift in outbound travel patterns. The decline in travellers heading to traditionally popular long-haul destinations such as the USA, Canada, and several Schengen countries was largely due to visa processing delays, higher travel costs, and uncertainty around approvals.” While long-haul destinations like the USA and Europe are slowing down because of airspace restrictions and rising fares, this is prompting travellers to plan shorter, more cost-efficient overseas trips. People who previously intended to go on long-haul trips are also changing their preferences and opting for either shorter regional trips or travel to nearby international destinations.
Changing Preferences of Travellers
Tanvi Merchant, a resident of Kondhwa, shared her experience: “My daughter has just completed her Standard X exams. We wanted to go on holiday in the USA, but there has been uncertainty about flights. We have now planned to visit Singapore.” This sentiment reflects a broader shift among Indian travellers who are choosing destinations like Singapore, Thailand, and other Asia-Pacific locations over traditional long-haul options.
Rise in Travel Insurance Uptake
On the other hand, the trend of travel insurance is seeing an uptick. According to Policybazaar data, travel insurance policy issuance has increased by 22% year-on-year, with the majority of travellers opting for destinations in the Asia-Pacific region. Narendra Bharindwal, president of the Insurance Brokers Association of India (IBAI), told TOI: “Customers have increasingly been opting for covers of USD 1,00,000 and above. We have also been seeing a rise in family floater travel policies, multi-trip annual plans among frequent flyers, and greater interest in benefits for trip cancellation and curtailment.” Advisors and brokers are playing a proactive role in flagging destination-specific risks at the point of sale, added Bharindwal.
Comprehensive Policies in Demand
Rakesh Kaul, chief distribution officer (retail business) of Bajaj General Insurance, told TOI: “One of the key trends that we witnessed has been of comprehensive policies. These policies covered a wide range of uncertainties, including trip cancellations, delays, and medical emergencies. Travellers were increasingly looking at end-to-end coverage to ensure a smoother and more secure travel experience. For travellers who have already planned their overseas trips, choosing a well-rounded policy has become essential to manage unforeseen situations.”
Customisation and Instant Assistance
Insurers are allowing customers to choose the base cover and add specific riders based on their destination, trip type, or health profile. Insurers said customers were now expecting instant policy issuance, paperless claims, and real-time 24/7 assistance, not just on the voice helpline but also through apps and chat interfaces. Raj Kulkarni, a resident of Pashan, noted: “There was a need for instant assistance if a flight was cancelled or luggage lost, or any other emergency arose. Many insurers were now offering this service. There were also flexible policy options with customisation pathways.”
