Why travel insurance costs are rising

Global flight disruptions tied to the Strait of Hormuz blockade and Middle East conflicts are pushing up jet fuel costs, closing airspace and forcing airlines to reroute or cancel flights. Insurers are reacting with premium hikes of 15% to 40% on high-risk routes, while demand for Cancel For Any Reason coverage has climbed 27% since March.

More than 150,000 international flights were canceled or rerouted from March through June, with Europe-bound trips among the hardest hit, according to the research. Policies that cover delays of more than six hours are getting more attention because they can reimburse meals, lodging and alternate travel.

Who feels the squeeze

Tourists on international routes are seeing higher fares, more delays and more cancellations, especially on trips to and from Europe and the Middle East. Digital nomads and expats face steeper prices on long-term plans, with some risky routes priced up to 40% higher and war-zone exclusions still common.

Government warnings are part of the price calculus. The U.S. State Department issued worldwide cautions in late February and again on March 22, while UK, U.S. and Canadian advisories on the Middle East have helped trigger immediate premium increases, the research said.

What travelers are checking before they book

Travelers are being told to read the fine print before buying, especially on war exclusions, delay thresholds and reimbursement caps. Standard policies often void coverage if a trip goes ahead against official advice, so many buyers are comparing FCDO and State Department alerts first.

For flexible coverage, some nomads are choosing plans with CFAR add-ons, which can return 50% to 75% of nonrefundable costs but raise total premiums by 40% to 50%. Others are looking for long-stay policies that include device cover, mental health care and home-country visit rules.

Check our country guides for destination-specific details.