The bosses of the UK’s three biggest holiday firms discuss the problem and how they are defending themselves against the surge in claims
Nick Longman, managing director, Tui UK and Ireland
Q. You’ve seen a staggering 1,400% rise in claims in the past two years. Does action need to be taken now?
A. We are keen to deal with it. It’s ironic that it comes at a time when hygiene standards are at their highest. People do, unfortunately, get sick on holiday and, on occasions, that will be because of the way food has been prepared. But what concerns me is that customers are being talked into making fraudulent claims, and don’t know the implications. UK customers are putting themselves in a position where they could end up with a fine or in prison.
Q. What’s being done behind the scenes?
A. We are doubly careful in terms of our audits and have trained staff to report anything that could possibly give rise to a sickness issue. We are working with resorts, and haven’t seen any trend of a rise in sickness. In the past, we might not have looked at each case in so much detail, but now we are scrutinising every one. Where we don’t believe a claim is genuine, and have reasonable proof, we will defend it in court or counter-sue. We are not going to lay down and process these claims. We have also been using private investigators to pose as customers and have collected leaflets from claims firms. Where we find evidence of malpractice, we will report them to the regulators. And if it is fraud, we will contact the police.
Q. You’re sending customers whom you believe to be making false claims warning letters. How has that been working?
A. It’s proving quite effective. In about 50% of cases where we’ve written to people, claims have been dropped. I’m sure in many instances, people were persuaded to make claims against their better judgement.
Q. Do you think it’s fair for the government to worry that tackling gastric illness claims will lead to a claims problem elsewhere?
A. Just because the problem might pop up elsewhere, doesn’t mean we should stop. It doesn’t stop the government from looking broadly at the way in which these claims are made.
Q. What happens if the issue isn’t tackled?
A. If we continue to pay out at this level, prices will go up for everyone. Because this is a UK-only issue, hoteliers are saying they don’t want to work with the UK market. They are not going to have these claims and defamation issues with the German or Belgian markets. And because this is essentially an all-inclusive issue, it could diminish customer choice in that market. That’s a shame because all-inclusive is more important than ever in these austere times. And with costs going up, some people may choose not to buy insurance.
Q. How does the industry fight this?
A. We should work together to lobby the government. This is not a competitive thing. I’m up for sharing ideas and ways to gather evidence.
Q. What do you think of the German model [claims are valid only if 20% of a hotel’s guests complains]?
A. I would be a bit wary of going down that road. We don’t want to block genuine claims. If someone is genuinely ill, then we should look after them and compensate them appropriately.
