Travellers will be left exposed if FSA regulates travel insurance sales – ABTA
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
Phil Davies
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