Last week we wrote an article stating that insurers want to increase their profit margin by targeting victims of holiday sickness and accidents. Having noticed increased profits from their successful whiplash campaign, the insurers now want a bigger piece of the profit pie at the expense of genuine accident victims.
The new scheme
The travel industry is urging genuine victims of holiday sickness to shun personal injury lawyers for its own settlement scheme. As reported in the Law Gazette, the Association of British Travel Agents (ABTA) has unveiled a new and independent dispute resolution scheme for holiday claims worth up to £10,000. This new mediation scheme is administered by the Centre for Effective Dispute Resolution (CEDR), which is approved by the Chartered Trading Standards Institute (CTSI). The travel insurers are promoting this scheme to be cost-effective, very quick and fair and will not require you to go to court.
The insurer’s hidden threat
The insurers are basically offering holiday sickness victims an ultimatum. They’re saying, “We can either do this the easy way where you use our settlement scheme and you don’t have to go to court, or we can do this the hard way where you get legal representatives and we’ll settle this at court.” They are using scare tactics to force people who are uneasy about going to court to use their proposed scheme instead.
However, we can reveal this is actually a double bluff. The truth is insurers don’t want to go to court. It costs the insurers more money and time. The insurers know they are liable for your injury and illness. The majority of holiday sickness claims don’t go to court as the insurers will settle cases beforehand, even when court proceedings have started. By handing the threat of court as an alternative, this is disingenuous and misleading.
Debunking their promotion
Whilst their promotion of the scheme being cost-effective, quick and fair sounds pleasant on the surface, it hides the fact the scheme benefits the insurers more than the claimant.
The travel insurers promote their scheme to be cost-effective, but this is only true for insurers as most personal injury cases are no win no fee. The insurer can bypass certain legal fees if people use their scheme instead.
They also promote their holiday sickness scheme to be very quick. They quote their settlement process to take no longer than 8 weeks, which sounds too good to be true. It is likely that according to their terms and conditions the insurers will have a grace period in which to turn your complaint around. This means your 8 week claim process only begins after their stated grace period, which could be up to 2 months, and not from when you first bring up your complaint with them.
How you will lose out
The new mediation scheme does not force the insurer to make you an award. This means if there is no offer or agreement, then you may not be awarded any compensation and this cannot be challenged at court. Also, to use their scheme you must comply with their strict terms and conditions and be bound to them. Failure to do so means, again, you will lose out on compensation. The scheme also encourages holidaymakers with sickness to avoid seeking professional advice and genuine support on their case.
Insurance is a business
This new mediation scheme was only drawn up because there has been a rise in sickness claims over the years. This is simply because more people are now aware that they can claim for holiday sickness. So how have the insurers reacted to this? By promoting a new scheme to allegedly help claimants, but actually it only benefits themselves, their savings and profit. Why else would they bother urging you to sidestep lawyers and lose out on genuine advice and support for your holiday claim?
1. Pixabay; Leonardo Valente; https://pixabay.com/en/sandals-flip-flops-footwear-beach-342672/