Government to crackdown on insurance cover from travel agents
July 4, 2007 by admin
Filed under News, News-Insurance
According to a recent report the government in the UK plans to crackdown on travel insurance cover purchased from travel agents in a bid to provide consumers with higher levels of protection when they purchase this insurance.
The government has announced plans to regulate the sector, and this means that travellers could look forward to increased levels of protection when they purchase their travel cover from travel agents.
The government has announced that the Financial Services Authority will now be regulating travel insurance sold alongside holidays by travel agents. Travel agents that plan to sell this type of insurance with holidays will therefore have to make sure that it is designed to fit the needs of customers.
Customers will have to be treated fairly in line with Financial Services Authority regulations when buying these policies, and in the even that the customer of dissatisfied with an aspect of the sale of the policy he or she can go through the Financial Ombudsman Service.
Ed Balls, economic secretary to the Treasury, stated: ‘Evidence shows that companies regulated by the FSA are better at getting consumers to make an informed choice because they are better at explaining the key features and exclusions of the product and guiding the customer through the sales process.’
The crackdown results from complaints from consumers groups with regards to unsuitable and expensive policies being sold to customers in the past – a problem that this move will help to reduce. The new regulations are set to come into force in 2009, although many officials from the travel agents industry are not happy about the move.
The travel agency industry had asked for the opportunity to make changes without these new regulations being put in place, but were not granted this opportunity.
Tom Smith
4th July 2007
