What was once regarded as optional is now becoming essential for Indian travelers heading abroad. The adoption of overseas travel insurance has nearly doubled in the past six years, fueled by soaring medical costs and heightened awareness of potential travel disruptions post-pandemic. Nearly 97 lakh lives were covered under overseas travel insurance policies in the fiscal year 2024-25, signifying a major shift in the attitudes of Indians towards international travel.
Surge in Insurance Coverage
The latest report indicates that 96.7 lakh individuals were insured under 27.9 lakh overseas travel insurance policies during 2024-25. The gross premium income from this sector hit Rs 1,267 crore, showcasing a remarkable 91% increase compared to the 50.5 lakh lives covered in 2018-19. Simultaneously, gross premium income surged by 67.4%, rising from Rs 757 crore in FY19. This growth reflects a growing recognition among travelers of the necessity of insurance while traveling abroad, particularly due to significantly higher medical treatment costs overseas.
The market share of private general insurers in this segment has also increased, climbing from 81% in FY19 to 84% in FY25. This trend highlights the evolving landscape of travel insurance in India, with more travelers opting for coverage to protect themselves against unforeseen circumstances.
Changing Traveler Demographics
Kapadia, head of travel insurance at Policybazaar, points out that the pandemic has accelerated a change in how Indians plan their international trips. He emphasizes that travelers are now more cognizant of the risks involved. Medical expenses abroad can be five to eight times higher than in India, even for non-critical care. Additionally, disruptions in flight schedules have underscored the financial ramifications of delays and missed connections, making insurance coverage increasingly appealing.
Dev Karvat, founder and CEO of Asego, notes that leisure travelers make up the largest segment seeking overseas medical insurance. However, business travelers, students, and long-term expatriates are also increasingly purchasing these policies. Notably, senior citizens represent a growing demographic, as more older Indians travel abroad, boosting demand for specialized medical coverage and dependable emergency assistance.
Growth in Outbound Travel
The India Tourism Statistics report from the Ministry of Tourism shows a 14.7% rise in outbound departures, increasing from 2.7 crore in 2019 to over 3 crore in 2024. This surge in international travel has contributed to the steady rise in overseas travel insurance adoption, even though such insurance is not universally required. Some destinations, like Schengen countries, mandate insurance as part of their visa requirements.
Ravi Gosain, president of the Indian Association of Tour Operators, attributes the growth in overseas travel insurance to the robust revival of outbound travel from India. As more Indians travel abroad, the significance of travel insurance becomes increasingly clear, ensuring that travelers are safeguarded against potential risks during their journeys.
Digihunt is not a financial advisor and this is not investment advice.