COVID-19 Legal Update - 16 March 2020
Just as the government has moved into the delay stage, we believe operators faced with FCO advice not to travel, must do the same.
Alan Bowen, ATTA Legal Advisor recommends for customers to make claims against their insurance policies. While it is unlikely that claims will be successful it would provide a break of 4 weeks or so in the tour operators cash flow. Referring to one clients insurance policy Alan Bowen quotes:
The following are reasons we will accept for you cancelling or cutting short your trip:
- You die, become seriously ill or get injured.
- A relative (see Definition on page 15), business associate, a person you have booked to travel with or a relative or friend living abroad, who you plan to stay with, dies, becomes seriously ill or gets injured.
- You have to go to court to be a witness or be on a jury (but not as an expert witness) or you are put in quarantine.
- There is an accident involving a vehicle you were planning to travel in, which happens within seven days before the date you planned to leave and means you cannot use the vehicle. This only applies to self-drive holidays.
- You are a member of the armed forces, police, fire, nursing or ambulance services and you have to stay in your home area because of an emergency or you are posted overseas unexpectedly.
- You being made redundant, as long as you had been working at your current place of employment for a minimum continuous period of two years, and that at the time of booking the trip or the date you purchased this insurance cover, you had no reason to believe that you would be made redundant. This cover would not apply if you are self-employed or accept voluntary redundancy.
- It is necessary for you to stay in your home area after a fire, storm, flood or burglary at your home or place of business within 48 hours before the date you planned to leave. We will need a written statement from a relevant public authority confirming the reason and necessity.
- It is necessary for you to return to your home area after a fire, storm, flood or burglary at your home or place of business. We will need a written statement from a relevant public authority confirming the reason and necessity.
- You cannot commence travel to your intended destination due to the (FCO) Foreign and Commonwealth Office advice for your destination/location changing to as a minimum ‘all but essential travel’ after the purchase of your policy or after the booking of any individual trip, whichever is the latter. This also applies to where such FCO advice changes are announced after you have commenced your trip/holiday.
However when you read the first part of the clause:
A - Cancelling and cutting short your holiday What you are covered for If you have to cancel or cut short your trip because of one of the reasons listed below we will pay up to the amount shown in the table of benefits on pages 5 and 6 for:
- Unused travel and accommodation expenses that you have paid or have agreed to pay under a contract and which you cannot get back, including any local prepaid excursions, tours or activities, if it is necessary and you cannot avoid cancelling or cutting short your trip;
It seems to me this means that claims would be denied in the case of a package sale but might not be if the customer had booked separate elements and had contracts directly with suppliers, such as African lodges, who refused to offer refunds because the accommodation is still available.
Ultimately the whole industry is being put under extreme pressure at the moment and if clients can defer their travel that is in reality the best situation we can hope for at the moment.
All ATTA's advisors are available to support members in their queries at this time either via ATTA HQ or directly here