Travel Agents Under Scrutiny
Travel agents have recently been under scrutiny regarding their charges for travel insurance policies sold alongside packaged holidays.
Travel insurance policies have been regulated by the FSA since 2005, however, policies sold alongside packaged holidays by Travel agents currently do not fall under the FSA regime.
Travel agents and tour operators were last year accused by Which?, the consumer champion, of mis-selling their policies.
A rule of selling travel insurance is to ensure questions are asked, specifically questions regarding pre-existing medical conditions, however, it was revealed that only 30% of travel agents were asking questions regarding pre-existing medical conditions.
Only 19% explained what the policies covered, however, it was not explained what the policies did not cover.
Mike Monk, head of the financial services for Association of British Travel Agents (Abta) requested for those selling insurance to take exams and questioned the reliability of the Which? Report.
“Abta sent its own survey to 500 people who had recently bought travel insurance. The results said that 82 per cent of those who bought travel insurance through a travel agent or tour operator were asked about pre-existing medical conditions, compared to 84 per cent through brokers and other channels,” he says, “There’s no evidence to suggest that travel agents mis-sell travel insurance.”
Teresa Fritz of Which? responded by saying:
“The survey used a perfectly adequate sample size - 24 travel agents - and the majority didn’t get a good deal. ”
The Association of British Insurers (ABI) said that it would make life easier if all insurers were regulated in the same way, but added that if Travel agents ceased selling insurance, then there would be concern that people would be tempted to travel with no insurance at all.
Financial analysist Defaqto performed research and discovered that travel insurance sold alongside packaged holidays via travel agents do tend to cost more than those sold by other insurance companies in the market.
I would conclude from this that it is wise to shop around when looking for Travel insurance and not to necessary go with the packaged deal.
If you have a pre-existing medical condition and you are looking for travel insurance, it is important to check with the insurance company that you are properly covered as some insurances differ in the way they offer policies if you have had an illness in the past.
