The costs of fighting fraudulent sickness claims are rising, say Spanish lawyers. Ian Taylor reports
Lawyers in Spain have challenged the idea that an epidemic of scam sickness claims by British holidaymakers is being brought under control.
They say Spanish hoteliers are being forced to pay for the new determination among UK tour operators’ to fight fraudulent claims.
Marie Rogers of Madrid-based law firm Rogers & Co said: “There is a lot of noise, [but] when tour operators fight [these fraudulent claims] the hotels have to pick up the costs.”
Fellow Rogers & Co lawyer David Diez Ramos, who acts for hotel insurers, said: “The situation is worse than a year ago. There are fewer claims, but they are more expensive.
“In the last year we received 20 instructions a month [on sickness claims] and perhaps one or two with a lawyer acting for the tour operator. This year almost every claim has a solicitor acting for the tour operator.
“We used to deal with in-house lawyers. Now we deal with intermediary solicitors or para-legals. It’s adding to the bill. They are reviewing the documents of 100 claims to find one to defend and charging to review every document. We see lists of 35 documents requested by tour operators’ solicitors and they are charging for this.”
He insisted: “Appointing more and more lawyers is not going to make the claims more defendable. It just increases the costs. It would be much easier to defend claims if more tour operators had a [contemporary] record of customer satisfaction, but I’m not seeing that kind of evidence.”
Both lawyers describe the growing policy among UK tour operators of fighting all cases considered fraudulent as “disastrous”.
Ramos said: “It would be a reasonable decision if tour operators pick up the costs, but they pass on the costs to the Spanish [hotel] industry.”
Rogers said: “There is only a chance of defending 1% of fraudulent claims. In 99% there is no contemporary evidence of illness, but [also] no evidence of fraud. Tour operator lawyers are running up costs and these are being passed on to the hotels. We are all fighting this fraud, but tour operators seem happy to pass on every cost to the hotels.”
She added: “The hotels are held to ransom. The tour operators can strong arm the hotels because they retain the hoteliers’ cash flow. They want to kill off these claims, but why don’t we share? Don’t pass on the costs.”
Ramos warned that the price of Spanish holidays would rise because insurers no longer cover the costs of most sickness claims. He said: “It is going to increase the price of holidays because insurers are increasing their premiums and deductibles [excesses] above the level of the average claim settlement of £3,000. Some insurers have even decided to forget the hotel industry.
“There is almost no profit for a hotel if they see two or three [sickness] claims a week.”
He insisted: “If the UK [government] brings the claims within the small claims regime it would be fantastic. But I fear the claims management companies and solicitors will find another way to bring these claims. It is an industry.”