The ongoing conflict in West Asia is prompting insurers and policyholders to reassess how effectively travel insurance covers geopolitical risks, a category that has emerged as one of the more persistent uncertainties in recent years, according to a report by The Times of India (TOI).
Early signs of stress are already visible in claims behaviour, driven largely by disruptions rather than direct damage. “We have received travel inconvenience claims such as flight cancellations, trip cancellations or interruptions, and accommodation extensions. We have already paid quite a few claims and are actively engaging with customers to process the remaining eligible claims,” Chandrakant Said, vice-president, consumer underwriting at Tata AIG, told TOI.
For now, however, the direct financial impact on insurers remains limited. “The Iran conflict highlights the long-term need for sharper assessment of geopolitical risks by insurers. In the immediate term, we are not seeing much travel activity in affected regions, so the direct impact on claims and demand remains limited,” Anup Rau, MD and CEO of Generali Central Insurance, was quoted as saying. Lower travel volumes have helped contain both claims and new policy issuance.
The situation is also exposing a gap between customer expectations and policy design. Rau noted that most standard travel and health insurance policies globally exclude losses arising directly from acts of war or military conflict, making it essential for travellers to review policy terms carefully.
Insurers, in response, are tightening underwriting filters. Amarnath Saxena, chief technical officer at Bajaj General Insurance, told TOI that several high-risk countries — including Iran, Yemen, Syria, Iraq and Afghanistan — have historically been excluded from coverage due to long-standing security concerns.
For other countries in the region such as the United Arab Emirates, Saudi Arabia, Jordan, Oman, Bahrain, Israel, Lebanon, Qatar and Kuwait, policies had earlier been issued under standard underwriting norms. However, with the situation evolving and travel advisories changing, insurers have paused new policy issuance for these destinations. Travellers who had already booked trips are also increasingly opting to cancel their policies.
Despite these shifts, the boundary between covered and excluded risks remains nuanced, underscoring the growing complexity of insuring travel amid geopolitical uncertainty, TOI reported.
Early signs of stress are already visible in claims behaviour, driven largely by disruptions rather than direct damage. “We have received travel inconvenience claims such as flight cancellations, trip cancellations or interruptions, and accommodation extensions. We have already paid quite a few claims and are actively engaging with customers to process the remaining eligible claims,” Chandrakant Said, vice-president, consumer underwriting at Tata AIG, told TOI.
For now, however, the direct financial impact on insurers remains limited. “The Iran conflict highlights the long-term need for sharper assessment of geopolitical risks by insurers. In the immediate term, we are not seeing much travel activity in affected regions, so the direct impact on claims and demand remains limited,” Anup Rau, MD and CEO of Generali Central Insurance, was quoted as saying. Lower travel volumes have helped contain both claims and new policy issuance.
The situation is also exposing a gap between customer expectations and policy design. Rau noted that most standard travel and health insurance policies globally exclude losses arising directly from acts of war or military conflict, making it essential for travellers to review policy terms carefully.
Insurers, in response, are tightening underwriting filters. Amarnath Saxena, chief technical officer at Bajaj General Insurance, told TOI that several high-risk countries — including Iran, Yemen, Syria, Iraq and Afghanistan — have historically been excluded from coverage due to long-standing security concerns.
For other countries in the region such as the United Arab Emirates, Saudi Arabia, Jordan, Oman, Bahrain, Israel, Lebanon, Qatar and Kuwait, policies had earlier been issued under standard underwriting norms. However, with the situation evolving and travel advisories changing, insurers have paused new policy issuance for these destinations. Travellers who had already booked trips are also increasingly opting to cancel their policies.
Despite these shifts, the boundary between covered and excluded risks remains nuanced, underscoring the growing complexity of insuring travel amid geopolitical uncertainty, TOI reported.
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