Travel insurance adoption among Indian travelers has seen a significant surge, with purchases increasing by 43% year-on-year in 2025. This substantial rise indicates a notable shift in how Indian travelers perceive travel insurance, increasingly viewing it as a necessity rather than an optional add-on when planning international trips.
Data released by global travel banking fintech Niyo reveals that between January and October 2025, their customers purchased 11,979 travel insurance policies, highlighting a growing awareness of the financial and medical risks associated with overseas travel. This trend is particularly pronounced among younger travelers, first-time international flyers, and those taking short-haul leisure trips, suggesting a broader change in attitudes toward financial preparedness.
Several factors contribute to this increased adoption rate. Rising overseas medical costs, frequent flight delays and cancellations, and a growing awareness of baggage loss and other travel-related risks are key drivers. The availability of instant, digital insurance purchases has also played a significant role, making it easier for travelers to secure coverage.
Vinay Bagri, Co-founder and Chief Executive Officer of Niyo, noted that travel insurance is no longer seen as discretionary spending, with even short-haul travelers increasingly opting for coverage. This reflects a greater financial awareness and maturity among Indian travelers.
Niyo's data indicates that 86% of travelers are opting for insurance cover of around Rs 50,000, a level typically chosen by those visiting budget-friendly Asian destinations. Countries such as Thailand, the UAE, Indonesia, and Vietnam account for the highest volume of policies, driven by frequent travel and affordable air connectivity. Long-haul destinations, particularly the United States, also record consistently high insurance uptake, largely due to higher healthcare costs, stricter travel requirements, and greater exposure to flight disruptions.
The rise in overseas travel from India is a major factor driving the demand for international travel insurance. As more individuals travel for leisure, education, and business, insurers are reporting increased inquiries and higher policy adoption, supported by elevated healthcare costs abroad, stricter documentation norms, and a broader understanding of travel-related risks.
Within international policies, travel health insurance plays a central role in decision-making. Buyers are carefully reviewing inpatient and outpatient limits, day-care procedures, emergency dental care, sub-limits, deductibles, and co-pays. Transparent handling of declared conditions and practical notification windows supports smoother assistance and fewer disputes.
The India Travel Insurance Market was valued at USD 1.73 Billion in 2025, and is expected to reach USD 4.17 Billion by 2031, rising at a CAGR of 15.87%. This rapid growth is driven by increasing awareness of travel-related risks and increased travel activity for business, leisure, education, and medical purposes. While India currently accounts for less than 1% of the global travel insurance market, the sector is rapidly gaining momentum.
Initiatives such as "Dekho Apna Desh" have further boosted domestic tourism. As travel becomes more frequent and widespread, so do associated risks - including flight disruptions, health emergencies, and geopolitical uncertainties - leading travelers to seek comprehensive coverage. Additionally, countries like those in the Schengen zone require travel insurance for visa processing, which is also fueling demand. The widespread use of digital travel platforms is facilitating bundled insurance purchases, enabling broader reach and quicker adoption of travel insurance among consumers.
