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21 February, 2007 |
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| Travellers will be left exposed if FSA regulates travel insurance sales - ABTA |
| Comments: 3 |
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More people will be put at risk travelling overseas without travel insurance if the trade is regulated by the Financial Services Authority, ABTA has warned.
In its submission to the Treasury's review on the sale of travel insurance, the association claimed the burden of FSA regulation would be both expensive and bureaucratically onerous.
It is likely that many of ABTA members - particularly small and medium sized travel agents and tour operators - would stop selling travel insurance if regulation was imposed. This would reduce the choice for consumers, and could result in more travelling abroad uninsured, ABTA argued.
ABTA claims its own "extensive research" on customer complaints has found "almost a total lack of evidence" that the travel trade is mis-selling travel insurance.
Head of financial services Mike Monk said: "When customers book a holiday, it is logical for them to buy travel insurance at the same time, as this provides instant protection, if they need to cancel.
"Travel companies are in a unique position in this regard. They can offer the holidaymaker the best advice on their travel insurance needs as they have just sold them their holiday. It is convenient, and safeguards against customers from forgetting to buy insurance at a later date."
ABTA argues that it effectively regulates its members on the sale of travel insurance when sold in conjunction with travel arrangements through its Code of Conduct.
It also requires all employees who sell travel insurance to go through a training programme and pass exams. More than 50,000 staff have completed the training and any customers who feel they have been mis-sold travel insurance through an ABTA member can contact ABTA with their complaint.
Monk said: "There is always room to improve levels of service and competence - but extending regulation is not the way to do it.
"The best way is through a rigorous and well-policed system of education and support. ABTA members are in the best place to offer the advice and sell travel insurance, and the vast majority of them sell travel insurance correctly. Reducing choice will not be good for consumers. There is no case for extending regulation."
by Phil Davies
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Categories:
Breaking News, Travel Agent News, Tour Operator, Destination
| | | USER COMMENTS | | | Steve Norris
22 February 2007, 07:55:34 GMT
More customers will travel without protection
As I am at the sharp end of this I can speak first hand.
When you have organized a customers travel arrangements one of the questions I naturally ask is do they have travel insurance? Nearly all reply yes. I then ask whom the policy is with and the I recieve replies are. I will get the E111, my bank covers me, my card covers me, I will get it at the Post Office or I dont need it. On questioning customers whom believe their card or bank covers them most cannot answer the basics of what they are covered for, whom the insurer is, whether they have physically have a copy of the policy or what or whom it covers them for or any emergency numbers, whether they have to use their card to pay for the holiday for insurance to be in place and whether it extends to family and friends they are booking for. Added to that, assuming it does cover them whom then asks them the relevant medical condition questions? Does the card company or bank call them, I doubt that. No the customer will be liable to declare that, but how many would know they have to? In other words they do not know if they are covered. E111 customers in general seem to think that travel insurance is the same thing but the E111 is free. They fail to realize that it only offers basic state care and nothing else. Finally, the 'I will get it from the post office or the internet' customer. On asking them they often say that they have heard travel agents "rip them off on insurance and thats how we earn our commission". They have been misled thanks to the media into thinking all travel agents overcharge. Many of these customers, unless I take time to explain our competitive pricing and benefits, will simply forget or never "get around" to it and travel without any insurance at all.
I provide sound advice to all of these different categories of customers and most whom I take the time to explain to will then purchase from me one of the best insurance policies there is in the travel industry. I have such confidence in it and I feel reassured that my customers will be safe on their travels.
If the FSA removes my right to sell insurance acting in the interest of their members then I firmly believe that many of my clients will not bother with travel insurance or unwittingly travel thinking all the parties are covered by their bank/credit cards or travel on an E111. The incidents of customers saying "I thought I was covered" on GMTV or other programs will increase and the FSA will have a lot to answer for. Leave Travel Insurance with the experts in Travel rather than just assume that customers will call some profit seeking hungry sales person in a robotic call centre or remember to purchase it online.
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Mr M. Buxton
21 February 2007, 14:34:00 GMT
FSA - are you sure it is worthwhile?
When purchasing my car, house and other everyday insurances I am not usually impressed by the call centres knowledge of the products they handle. I feel that because I offer one product my staff know it and understand it better. In fact, I reckon we offer a better buying experience than most of my purchases through an FSA approved supplier.
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Kevin Bonner-Williams
21 February 2007, 12:22:05 GMT
FSA for some but not all?
Before FSA there was no evidence that the public were being badly served by travel trade. Yet half the trade is now regulated and half is not. If the FSA feels that protecting the public regulation is required, then it must apply across the board. The public would then be able to purchase travel insurance knowing the regulation applies to all their purchases and that all providers are 'Treating their Customers Fairly'. Clearly ABTA fears that it members would be unable to pass regulation.
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