ASDA has started selling annual travel insurance which it claims will undercut many travel agency policies.

The ASDA for Travel division also claims its four annual travel insurance policies provide more benefits than other schemes. Prices start at £57.95 for a single person, £78.95 for a couple, £74.95 for single parents and £91.95 for families.

ABTA chief executive Ian Reynolds was dismissive of the policies and threatened action if ASDA began making spurious advertising claims.

ABTA recently won an Advertising Standards Authority case against Tesco after it claimed customers could save up to 50% on its travel insurance (Travel Weekly August 16).

He said: “ASDA’s policies are pretty unremarkable but the irritating thing is, once again, a retailer is saying it provides more benefits than others and at a lesser price than some travel agents when it isn’t necessarily the case.

“I hope we are not going to see foolish adverts from ASDA because if we do we shall have to take action like we did with Tesco.”

The ASAruled that a leaflet issued by Tesco implied that customers who bought its insurance would always save money, although this could not be justified in every case.

An ASDA spokesman said: “We are confident that our claims can live up to what our policies deliver.”

Asda claims that unlike many policies which charge higher premiums for over 65s, its policies cater for those up to 70 years old at no extra cost.