India Travel Insurance Market By Type (Railway, Bus, and Aviation), By Source (Bank & Non-Banking Financial Company (NBFC)), By Insurance Cover (Single Trip, Annual Multi-Trip & Long Stay), By User (Senior Citizens, Education Travelers, Backpackers, Business Travelers, Family Travelers & Fully Independent Travelers), By Location (Intracity, Intercity & International), By Region, Competition Forecast & Opportunities, 2021-2031F

Market Overview

India Travel Insurance Market was valued at USD 1.73 Billion in 2025 and is expected to reach USD 4.17 Billion by 2031 with a CAGR of 15.87% during the forecast period. The India Travel Insurance Market is a rapidly growing sector within the country's insurance industry, driven by the increasing awareness of the importance of travel insurance among Indian travelers. This market has witnessed substantial growth in recent years, and several key factors contribute to its prominence. India’s travel insurance market currently represents less than 1% of the global travel insurance industry.

However, as people increasingly embrace travel for intellectual, business, and personal pursuits, the importance of travel insurance is growing. The primary aim of travel insurance is to ensure a seamless travel experience by minimizing potential risks. Purchasing a travel insurance policy is a prudent decision, offering protection against various travel-related uncertainties. These policies typically cover both medical and non-medical emergencies, including sudden illness, trip cancellations or interruptions, loss or delay of baggage, and the loss of essential documents like tickets and passports. According to the latest data from the World Travel & Tourism Council (WTTC), international visitor spending in India hit a record ₹3.1 trillion in 2024, surpassing the previous 2019 peak by 9%. Additionally, the sector supported a historic high of nearly 46.5 million jobs, accounting for 9.1% of India’s total employment.

Key Market Drivers

Surge in International and Domestic Travel

One of the primary drivers of the India travel insurance market is the exponential rise in both international and domestic travel. With increasing disposable incomes, improved air connectivity, and lifestyle shifts, more Indians are traveling for leisure, business, education, and medical purposes. As per the latest data from the World Travel & Tourism Council (WTTC), India welcomed 20 million international visitors in 2024, an increase of 2.3 million over 2019, reaffirming its position as a top global travel destination and reflecting growing international confidence in its tourism sector. Looking ahead to 2035, international visitor spending is projected to reach USD 38.55 billion , while domestic traveler spending is expected to rise significantly to USD 192.77 billion. Moreover, domestic travel has surged with the government's focus on promoting regional tourism under initiatives like "Dekho Apna Desh." As travel becomes more frequent and varied, the potential risks increase—from medical emergencies to baggage loss, flight delays, or even geopolitical disruptions. This has heightened awareness about the importance of travel insurance among Indian travelers. For students and professionals traveling abroad, many countries, especially in Europe (Schengen region), mandate travel insurance as part of visa requirements. These regulations are propelling the demand for comprehensive insurance plans that offer global coverage. Furthermore, the growth of online travel booking platforms has made it easier to bundle travel insurance with tickets, increasing adoption rates. The travel insurance market, thus, finds a strong foundation in the expanding travel landscape. 

Growing Awareness and Financial Literacy

The increased awareness of financial planning and risk mitigation is significantly contributing to the growth of travel insurance in India. Traditionally, insurance penetration in India was low due to limited awareness and complex procedures. However, with the digital revolution and greater access to financial education, consumers are becoming more informed about the benefits of securing their travels through insurance. The COVID-19 pandemic was a major turning point in reshaping perceptions about travel safety. The crisis underscored the unpredictability of travel, emphasizing the importance of protection against medical emergencies, cancellations, and other unforeseen events. As a result, demand for travel insurance surged post-2020, with consumers actively seeking policies offering COVID-19 coverage. This shift in mindset continues to influence travel decisions even in the post-pandemic world. A recent Policybazaar report reveals a 19% rise in Schengen travel from India in early 2025 compared to the previous year. Notably, more Indian women are choosing to travel solo and prioritizing travel insurance. There’s a clear shift towards higher coverage, with 62% of travelers opting for policies offering \$250,000 or more, moving beyond the traditional \$100,000 standard coverage. This highlights a growing awareness and seriousness about comprehensive travel protection among Indian tourists.

Technological Advancements and Digital Distribution

Technological innovation and the rise of digital distribution channels are critical drivers in accelerating the growth of India’s travel insurance market. The integration of technology into insurance services often termed InsurTech has transformed how travel insurance is designed, marketed, purchased, and claimed. Online travel aggregators, airlines, and even e-wallet platforms now offer travel insurance as a value-added service. With just a few clicks during ticket booking, travelers can purchase travel insurance without needing to visit a physical office or interact with agents. This seamless integration into the travel booking journey has led to a spike in insurance adoption, particularly among younger, tech-savvy consumers. Moreover, AI and data analytics are helping insurers personalize policies based on traveler behavior, destination risk profiles, and trip duration. Chatbots and AI-driven customer service provide 24/7 support, while blockchain technology is being explored for claims automation and fraud detection. These innovations are enhancing customer experience, reducing claim settlement times, and increasing trust in insurers. The article highlights the transformative role of technology and AI in India's travel insurance sector. The market, valued at ₹950 crore for overseas travel insurance in 2023, is projected to grow by 15–20% annually, potentially reaching USD 4,819 million by 2025 and USD 15,060 million by 2030. This growth is driven by digital platforms like Policybazaar and Bima Sugam, which enhance accessibility and customer engagement. 

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Key Market Challenges

Low Awareness and Penetration Rates

Despite rising travel volumes, a major challenge in India’s travel insurance market is the low level of awareness and penetration. Many Indian travelers, especially those taking domestic or short-haul international trips, still do not see insurance as a necessity. Unlike health or motor insurance, travel insurance is often viewed as optional or an afterthought. This perception is especially prevalent in tier-2 and rural markets where financial literacy remains limited. Even among educated urban populations, there is a lack of understanding about the benefits of travel insurance—such as protection against trip cancellation, medical emergencies, and lost baggage. As a result, many travelers skip buying insurance to save on upfront costs, without realizing the potential risks and expenses they could face. Furthermore, insurance products are often complex, filled with exclusions and technical jargon, making it difficult for average consumers to make informed decisions. While digital platforms are improving accessibility, a strong push in consumer education is still lacking. Until awareness improves and the value of travel insurance is fully appreciated, market growth will continue to face limitations despite increasing travel trends.

Fraud Risk and Claim Settlement Issues

Fraudulent claims and inefficient settlement processes remain key challenges in the India travel insurance market. With the rise in insurance penetration, there has also been a corresponding increase in fake claims—such as exaggerated losses, forged medical documents, or staged cancellations. These incidents result in higher premiums for honest customers and hurt the financial stability of insurers. Additionally, claim settlement remains a pain point for many policyholders. A common complaint is the rejection of claims due to unclear or misunderstood policy terms. Travelers are often unaware of the required documentation, timelines, or conditions that must be met to file a claim successfully. This leads to a negative customer experience and deters repeat purchases. International claims add another layer of complexity. Coordination between foreign hospitals, embassies, and Indian insurance companies can be slow and inefficient, especially in emergency medical situations. Language barriers, currency conversion, and time-zone differences further complicate the process. While insurers are increasingly adopting digital tools and AI to improve fraud detection and automate claims, the industry still lags in achieving transparency and customer satisfaction in this area. Building trust through clearer policies and faster, more reliable claim processing is critical for long-term market growth.

Key Market Trends

Integration of Travel Insurance with Digital Booking Platforms

Another transformative trend is the seamless integration of travel insurance with online travel booking platforms. Whether it’s airlines, online travel agencies (OTAs), or fintech apps, many now offer bundled travel insurance at the point of booking. This "embedded insurance" model simplifies the buying process and increases uptake, especially among users who may not have otherwise considered insurance. For instance, when booking a flight on platforms like MakeMyTrip or Yatra, travelers are offered insurance coverage in a few clicks, often at a discounted rate. This frictionless purchase experience appeals to today’s digital-first consumers who value convenience and instant gratification. Moreover, these platforms use AI and data analytics to suggest the most relevant insurance options based on destination, duration, traveler age, and purpose of visit. Real-time policy issuance, claims tracking, and instant support via mobile apps further enhance the user experience. This digital distribution model has not only boosted awareness and sales but also made travel insurance more accessible to first-time buyers. With mobile internet penetration increasing across India, this trend is expected to continue driving insurance adoption at scale, especially among younger and tech-savvy travelers.

Customization and Specialized Coverage

One of the most notable trends in India’s travel insurance market is the increasing demand for comprehensive and personalized insurance coverage. Traditional one-size-fits-all policies are being replaced by customizable plans that cater to specific traveler needs—whether for students, senior citizens, adventure tourists, or corporate travelers. Post-COVID, travelers are more aware of the unpredictable nature of trips and are seeking policies that go beyond basic medical coverage. New-age plans now include benefits such as trip interruption, adventure sports coverage, quarantine expenses, loss of digital devices, and even telemedicine support abroad. Insurance companies are also offering destination-specific plans tailored to visa requirements (like Schengen countries), which ensure compliance with international travel norms. This customization not only enhances customer satisfaction but also builds long-term trust in insurance providers. Additionally, customers can now choose flexible policy durations and add-on features like zero-deductible options or automatic extensions for trip delays. This trend is a clear response to the changing expectations of modern Indian travelers who seek value, convenience, and specific protection in their insurance coverages.

Segmental Insights

Type Insights

The Aviation travel insurance segment dominated the Indian travel insurance market primarily due to the higher risk, longer distances, and higher ticket prices associated with air travel compared to bus and rail. Travelers flying domestically or internationally are more inclined to purchase insurance to cover uncertainties like flight cancellations, delays, baggage loss, and especially medical emergencies abroad. Additionally, many international destinations mandate travel insurance as a visa requirement especially in regions like Europe (Schengen Zone), Canada, and Australia—which further fuels demand for air travel-related insurance. Moreover, the widespread use of digital booking platforms for flights makes it easier for insurers to offer embedded travel insurance at the point of sale, resulting in higher penetration. Private airlines and online travel agencies (OTAs) often collaborate with insurance providers to bundle policies with flight tickets, making the purchase seamless for consumers. In contrast, travel insurance for rail and bus segments remains limited due to shorter travel durations, lower perceived risk, and limited consumer awareness. While IRCTC does offer optional travel insurance for train passengers, its adoption is modest. Given these dynamics, the aviation segment is expected to continue leading the market, especially as international and business travel rebounds post-COVID-19.

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Regional Insights

The South region of India has emerged as a dominating region in the India Travel Insurance Market due to its robust travel infrastructure, high literacy rates, and greater awareness of risk management among travelers. States such as Tamil Nadu, Karnataka, Kerala, Andhra Pradesh, and Telangana witness a high volume of both domestic and international travel for business, education, tourism, and medical purposes. Cities like Bengaluru, Chennai, and Hyderabad are major tech and education hubs with a population that frequently travels abroad, especially to the U.S., Europe, and Southeast Asia. This high outbound travel volume has led to increased demand for comprehensive travel insurance policies that cover medical emergencies, trip cancellations, and baggage loss. Moreover, the presence of well-established insurance providers and digital-first platforms in the region has made it easier for consumers to access and purchase travel insurance products. The South also shows higher adoption of digital ticketing and online insurance purchases, particularly among the urban middle class and younger population. With strong internet penetration and increasing financial literacy, the region continues to drive growth in travel insurance uptake. These factors collectively position South India as a key regional contributor to the expansion of the Indian travel insurance market.

Recent Developments

• In 2023, The Insurance Regulatory and Development Authority of India (IRDAI) implemented a mandatory Know Your Customer (KYC) requirement for purchasing new health, auto, and travel insurance policies, effective from January 1, 2023. Insurers are now required to collect KYC documents when customers purchase new life and non-life insurance policies, regardless of the premium. 
• In 2024, Zurich Insurance made a major entry into India’s general insurance sector by acquiring a 70% stake in Kotak Mahindra General Insurance for ₹5,560 crore. This strategic investment is expected to bring innovative travel insurance solutions to the Indian market, leveraging Zurich’s global expertise and product capabilities.
• In 2024, the Hinduja Group received approval from the Insurance Regulatory and Development Authority of India (IRDAI) for its ₹9,650 crore acquisition of Reliance Capital, including its insurance arms such as Reliance General Insurance. This move is set to enhance the group’s position in the general insurance space, potentially leading to more competitive and diversified travel insurance offerings.
• In 2024, ICICI Lombard launched 'TripSecure+', an AI-powered travel insurance product designed to deliver personalized coverage options such as visa fee reimbursement and protection for adventure sports, enhancing both customer experience and policy flexibility. Complementing this innovation, the introduction of instant digital policies with Electronic Know Your Customer (e-KYC) verification has streamlined the process by eliminating delays previously caused by lengthy document submissions and approval wait times.

Key Market Players

• TATA AIG
• HDFC ERGO General Insurance
• ICICI Lombard
• Bajaj Allianz
• SBI General Insurance
• Royal Sundaram
• Chola MS
• Reliance
• Apollo Munich
• Religare  

Report Scope:

In this report, the India Travel Insurance market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• India Travel Insurance Market, By Type:

o   Railway

o   Bus

o   Aviation      

• India Travel Insurance Market, By Source:

o   Bank

o   Non-Banking Financial Company (NBFC)

• India Travel Insurance Market, By Insurance Cover:

o   Single Trip

o   Annual Multi-Trip

o   Long Stay

• India Travel Insurance Market, By User:

o   Senior Citizens

o   Education Travelers

o   Backpackers

o   Business Travelers

o   Family Travelers

o   Fully Independent Travelers

• India Travel Insurance Market, By Location:

o   Intracity

o   Intercity

o   International

• India Travel Insurance Market, By Region:

o   North

o   West

o   South

o   East  

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the India travel insurance market.

Available Customizations:

India Travel Insurance Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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