Nearly half of the UK’s major insurers have pulled out of the travel insurance market since the coronavirus pandemic sparked chaos around the world, Which? has found.
The consumer group contacted 75 insurance providers to find out if and how they were amending their provision of travel insurance following the outbreak.
Which? researchers found that 31 insurers, including household names such as Aviva, LV= and Direct Line, had temporarily suspended the sale of travel insurance to new customers as a result of the pandemic.
A further 13 had changed aspects of their policies.
This is creating confusion and uncertainty for consumers, who may feel they simply can not make plans for future trips in the circumstances. Gareth Shaw, Which?
Existing customers who booked their trips and purchased their insurance before the outbreak, or before insurers amended their terms to exclude claims related to coronavirus, should still be able to claim for any non-refundable costs of cancelled holidays or travel plans as a result of the virus, Which? said.
But it said that for people looking to buy new cover for future holidays, there is now a shrinking pool of providers offering cover for travel.
Which? said it is also concerned that some insurers are potentially treating customers who have been affected by coronavirus disruption unfairly, using little known exclusions to reject claims, such as not covering claims where the holiday has been cancelled because of a change in advice from the Foreign and Commonwealth Office (FCO).
The consumer group said it recognises the huge strain the travel insurance industry is under, but it said the sheer number of sudden changes to policies and inconsistent responses to the crisis from different providers could create confusion for consumers – leaving them at risk of travelling without cover or abandoning their travel plans entirely.
It is urging insurers to work closely with the Government and wider travel industry to ensure that travellers are not left struggling to find adequate cover.
Insurers are stepping up to support millions of customers across the UK, expecting to pay out a record £275 million this year to help them manage travel cancellations and disruption.Mark Shepherd, Association of British Insurers
Which? is also advising anyone purchasing travel cover during this period to carefully check policy details and exclusions prior to buying, or book new trips with an existing annual multi-trip policy where possible.
Gareth Shaw, head of money at Which? said: “Coronavirus has had a huge impact on the travel insurance market, with dozens of providers amending policies or pulling them altogether.
“This is creating confusion and uncertainty for consumers, who may feel they simply cannot make plans for future trips in the circumstances.
“The Government, insurers and the travel industry must work together to tackle the huge challenge posed by coronavirus, to ensure people feel confident enough to travel in the knowledge that they will be covered.”
Mark Shepherd, assistant director, head of general insurance at the Association of British Insurers (ABI) said: “Insurers are stepping up to support millions of customers across the UK, expecting to pay out a record £275 million this year to help them manage travel cancellations and disruption.
“Most customers understand we are dealing with an unprecedented global situation.
“The Foreign Office now advises against all but essential travel to countries worldwide, and consumers are realistic about some impact on availability of new travel insurance policies as a temporary measure.”