Experts highlight how both operators and insurers are responding to a more complex and fast-evolving risk environment. Rather than functioning as a peripheral safeguard, liability coverage is gradually being treated as part of how tourism businesses design, deliver, and scale services.
A sector moving beyond traditional risk
Hospitality liability once largely revolved around predictable on-site incidents such as slips, falls, or property-related damage. That framework is now being stretched by the rise of curated travel formats, where experiences extend far beyond hotel premises.
Rohit Kohli, Joint Managing Director at the Creative Travel family of brands, a family-owned Destination Management Company (DMC) in India, notes that as travel becomes more experience-driven, insurance is linked with business planning itself.
In his view, liability protection is now embedded within the broader strategy of running a travel business, rather than being treated as an external compliance requirement.
This shift reflects how tourism offerings have expanded into areas such as adventure activities, wellness programmes, and customised itineraries, each introducing distinct operational dependencies and exposure points.
Where the risks are concentrating
As guest expectations evolve, so does the nature of liability exposure.
Evaa Saiwal, Head of Cyber & Liability Insurance at Policybazaar for Business, points to a widening risk surface across hospitality operations.
Guest-related incidents now extend across multiple touchpoints, including adventure activities, wellness services, food-related reactions, and safety issues linked to amenities such as pools and spas. In many cases, responsibility also flows through third-party partners — such as excursion operators, transport providers, and activity vendors — making accountability more distributed than before.
Alongside physical risks, cyber exposure has become a structural concern.
Hotels and resorts process large volumes of sensitive data, from identity documents to payment credentials, making them attractive targets for cyberattacks. Breaches or disruptions in these systems can trigger financial losses while also affecting customer confidence and regulatory standing.
How insurers are recalibrating coverage
In response, insurers are adjusting both how they assess risk and how they structure coverage.
Saiwal explains that underwriting today is shaped by operational readiness.
Before issuing policies, insurers evaluate how hospitality businesses manage risk in practice — looking at security infrastructure, access controls, staff preparedness, vendor oversight, cyber hygiene, and incident response mechanisms.
This approach reflects a shift from static risk classification to more dynamic, behaviour-based assessment of how a business operates on the ground.
Product design is also becoming more segmented. Instead of broad hospitality policies, insurers are creating targeted covers for specific travel formats, including adventure tourism, wellness retreats, water-based activities, and high-end experiential travel, where exposure profiles differ significantly from traditional hotel operations.
Cyber insurance is emerging as a separate and growing layer within this framework, driven by the sector’s dependence on digital booking systems and data-heavy customer engagement.
What travel businesses are seeing on the ground
Dev Karvat, Founder & CEO of Asego, a provider of travel assistance and insurance services, said premium travellers now expect “flawless execution across every touchpoint,” from bookings and visa documentation to supplier coordination and on-ground support.
He noted that even minor operational lapses can quickly translate into financial, legal, or reputational consequences for travel businesses.
He added that risks in the sector have widened beyond trip disruptions to include documentation errors, supplier defaults, employee fraud, lost passports, and liability arising from third-party or vendor-linked incidents.
Karvat said this has led to a growing need for specialised liability protection solutions tailored to travel operators, particularly in HNI and experiential travel segments. He noted that structured offerings such as Travel Business Protect (TBP) have been designed to address this gap by covering areas like legal defence costs, operational errors and omissions, supplier-linked risks, and customer liability situations that can affect business continuity.
