This growth is accompanied by a preference for closer international locations, with the Asia-Pacific region becoming the leading choice for outbound travel.
Japan saw the most significant rise in bookings, climbing 17% in 2026, making it the top destination for Indian travellers. Thailand followed with a 12% increase, while Vietnam experienced a 7% uptick. Singapore and Malaysia continued to attract steady interest, and Sri Lanka emerged as an appealing budget-friendly option.
Conversely, travel to the UAE dropped by over 70% due to regional tensions and safety issues. Moreover, long-haul trips to Europe and the US softened as a result of rising airfare and airspace limitations, prompting travellers to gravitate towards shorter, more budget-friendly Asian locales.
Concurrently, travellers are leaning towards higher levels of insurance coverage. Those selecting plans exceeding $250,000 have doubled compared to previous years, indicating a shift away from basic policies. The rising costs of medical care and potential evacuation scenarios are fueling this trend.
There are also changing demands for add-on coverage. Medical insurance is the most sought-after, at around 75%, followed by trip cancellation coverage at nearly 50% and evacuation insurance at about 40%. Although adventure sports insurance remains a niche market, it is steadily growing. Additionally, there is an increasing demand for protections against flight delays, rerouting, and airspace disruptions.
Travel habits are becoming more cautious and adaptable. Cancellation requests have seen a 32% rise, with many travellers postponing bookings until closer to their departure dates. As travel expenses increase by 20–25%, individuals are choosing to modify their plans instead of cancelling, opting for shorter trips to nearby locations.
Manas Kapoor, Business Head of Travel Insurance at Policybazaar.com, remarked that Indian travellers are not cutting back on travel but are adjusting to global uncertainties with more flexibility and enhanced protection.
He highlighted a notable shift towards Asia-Pacific destinations and a growing dependence on insurance as an integral component of travel planning rather than a mere afterthought, driven by factors like medical inflation, evacuation risks, and geopolitical uncertainties.
