Thomas Cook is pulling out of ABTA’s scheme that regulates travel insurance sales and has instead switched to the more stringent Financial Services Authority regime.
The travel giant will make the change later this month. The decision comes as the Treasury prepares to publish a report next Thursday over ABTA’s continued exemption from FSA regulation.
A Thomas Cook spokeswoman would not comment on whether the move is to cover future plans to sell more financial products that must be covered by the FSA. However, the finance market has long been identified as an area of potential growth.
She said: “Financial products are an area we’re looking at and it would be great if being under FSA regulations is helpful down the line.”
Despite the announcement, which coincided with a BBC Watchdog probe on Tuesday that criticised agency insurance sales, ABTA remained confident the Treasury will leave the regulation of insurance sales in its hands.
An ABTA spokesman said Thomas Cook is the 13th member to opt for FSA regulation, adding: “ABTA members need to look at their own business models and, if FSA regulations are appropriate, then they should go down that route.
“However, we still feel we have a strong case in terms of the Treasury review of the exemption from FSA regulation for the vast majority of ABTA members and we’ll fight their corner robustly.”
Federation of Tour Operators director general Andy Cooper said while Thomas Cook’s decision will not help ABTA, it should not detract from its case either, adding: “There isn’t much evidence that agents are mis-selling insurance.”