Travel Weekly has launched our Fight Fake Claims campaign to galvanise industry support for action to address one of the most serious issues facing the travel sector.
The recent rise in gastric illness claims constitutes a mass fraud on the travel industry driven by aggressive and unscrupulous claims management companies.
Over the past two years, the number of UK claims has shot up on average 500%, according to Abta, while the UK’s biggest holiday provider, Tui, reports its claims are up an astonishing 1,400%.
Some travel firms report they now have to employ more legal staff to handle these claims than they have sales people.
And yet this rise in the number of claims does not reflect actual levels of sickness experienced by UK holidaymakers: UK operators report no decline in customer satisfaction scores and there has been no equivalent rise in sickness claims among holidaymakers from other European countries staying in the same hotels.
Our campaign calls for…
• The closure of the legal fees loophole that is allowing lawyers and claims management firms to profit from soliciting false and exaggerated claims.
• New legislation that puts compensation claims for gastric illness suffered while on an overseas holiday on a par with other personal injury claims.
• A coordinated and determined approach from the travel industry, trade associations and hotel partners to challenge false claims and prosecute the fraudsters who make them
Size of the problem
With claims able to be brought retrospectively for up to three years and this year’s peak summer season about to start, the potential liability is enormous and, more worryingly, impossible to calculate.
Short-haul European beach destinations have been specifically, although not exclusively, targeted as these tend to offer traditional tour operator packages, including increasing volumes of all-inclusive and therefore greater levels of customer protection and responsibility for the product.
Majorca alone is said to have had €50 million worth of claims made against its hotels, which has led to some Spanish hoteliers considering stopping selling to UK consumers or passing on costs in higher prices.
Tourism is a valuable part of the UK economy. According to the Office for National Statistics, travel agencies and tour operators employ 80,000 people across nearly 6,000 companies, making up a growing sector worth £33.4 billion in 2016. It also provides exciting employment opportunities, particularly for young people and women. It is therefore reasonable to expect any government to do all it can to protect such a valuable sector of the economy from fraud.
Travel Weekly’s Fight Fake Claims campaign is calling for immediate action to end this claims culture blighting our industry.
Operators and Abta have been actively lobbying the government on this issue for some months and Abta has announced it will be stepping up its lobbying efforts to target new ministers after the general election, along with raising awareness among the public that making a fake claim is a fraud. We fully support its efforts.
We believe a number of simple measures will help, starting with limiting the legal fees lawyers can charge for personal injury claims of up to £25,000 related to incidents that take place overseas, bringing it in line with incidents that occur in this country.
This would remove the commercial incentive for claims management touts who are actively soliciting fraudulent and exaggerated claims from members of the public who are being told they could make up to £2,000 by simply claiming they were ill.
Longer term, action is required similar to that taken to address soft-tissue injury or whiplash claims with the introduction of tariffs on payouts and greater emphasis on medical evidence.
We acknowledge the travel industry has a role to play in prosecuting those it believes to be making fraudulent claims and in working collaboratively with hotels to ease the burden of liability.
This is not about disputing valid claims. It’s about tackling what has been likened to a “ticking time bomb” under the sector.
Something has to be done.