The May-June months traditionally see an increase in travel and tourism activities as most families and students plan their vacation during this period. This is because schools and colleges are closed for summer vacation and many of them look to escape the hot weather in the subcontinent.
Though North America and South-East Asia have been traditionally popular with domestic tourists, Europe has also received a lot of interest this time around, Mr Gaurav Garg, Managing Director and Chief Executive Officer, Tata AIG General Insurance, told Business Line.
“Europe is more expensive than Asian or American destination. However, with awareness increasing, Indians getting richer and travel companies offering better packages, we have seen an increase in the popularity of European destinations,” he said.
He added that the take-up rate of policies, the highest in May, has gone up by 30-40 per cent. Over the same period last year, the increase was around 25 per cent.
Apollo Munich Health Insurance said that the April to June period accounts for 40 per cent of its total travel insurance business for the whole year.
“Over the last few years we have witnessed a rise in the volume of travel insurance business during the summers, which eventually peak between the months of April and June. In the last couple of years, the maximum policies were sold for worldwide option where the US and Canada are also included,” said Mr Antony Jacob, CEO, Apollo Munich Health.
Travel insurance premiums are also the highest for North America, as medical costs in the US are higher than most other regions. Companies usually bracket North America into a different premium slab from the rest of the world.
“The cost of treatment, even for a medical emergency in the US is very high in comparison to Asian countries. The premium rate for travel insurance, for a trip by an individual to the US or Canada, is approximately 20-25 per cent higher than that of a trip to West Asia ,” said Mr Jacob.
The exact premium, however, is calculated based on the age of the traveller, sum insured, trip duration, type of travel (annual multi-trip or single travel), besides the region.