28th May, 012
It is expected that premium rates of travel insurance will be increased soon as leading general insurance companies are feeling the pressure of depreciating rupee.
The claims of outbound travel insurance are paid in foreign currencies while their premiums are collected in Indian currency. And as rupee depreciates it increases the cost for insurers.
Generally April-June quarter is considered as the best quarter for travel insurance, pegged at Rs 250 crore. And at this time it is expected that in near future rupee will touch 60 mark against dollar.
In current year Indian rupee has fallen more than 5% against US dollar, making it the worst performing Asian currency.
Depreciating rupee impacts the margins of insurers hence, it is expected that if this depreciation of rupee continues than insurers will increase the premiums of travel insurance.