A leading travel industry lawyer has warned of a “general inflation” in consumer claims and “more desire to demand money back” post pandemic.
Gareth Thomas, a partner at law firm Kennedys, told an Abta Aviation Forum in London on Tuesday: “We are seeing claims escalate.”
He argued: “There is general claims inflation at the moment. Claims are more expensive because of inflation and there is more desire to demand money back.
“People spent two years not being able to go abroad on holiday, then they had to pay more. There were capacity issues. Hotels had been closed for two years. We’re seeing an escalation of complaints about quality.”
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Thomas also highlighted a move into travel by “ambulance-chasing” law firms or claims management companies which previously pursued motor insurance personal injury claims, saying: “It’s a bit like the holiday sickness claims we saw [pre-pandemic].”
The industry endured a flood of holiday sickness claims in 2016 and 2017 before the government extended a fixed recoverable-costs regime for claims of gastric illness while abroad on holiday in 2018.
Industry lawyers have previously warned of a “rush of Covid claims” and urged travel firms to learn the lessons of holiday sickness claims.
Barrister Sarah Prager of 1 Chancery Lane told an Abta Travel Law Seminar in 2020: “If you were a claims company, where would you go next having lost whiplash claims and holiday sickness claims? There will be a rush of Covid claims.”
Thomas told this week’s Abta Aviation Forum: “We’ve also probably seen a few more legionnaires cases, possibly because hotels were closed for two years.”
He argued the problems with Covid-era refunds to consumers have long since been resolved, but he said there was no certainty of legal redress for travel organisers seeking refunds for the flight portion of cancelled holidays from airlines.
Thomas said: “We’ve come a long way since the first days of the pandemic when we got calls from tour operators which had never cancelled a holiday before. We’re back to the old issues of interpretation of the [package travel] regulations now.”
“[But] regarding redress between companies when there is a refund it is a lot more difficult. There is no provision for redress between companies. The regulations are there to protect consumers.”
He noted: “Abta has been doing work to bring companies together to discuss this.”
The Package Travel Regulations lack clarity on this question, stating only that an organiser which refunds a customer “may seek redress” from a third party “which contributed to the event triggering compensation”.