Direct Line welcomes Treasury’s announcement on travel insurance

Direct Line welcomes the Treasury’s introduction of FSA regulation for the sale of travel insurance with holidays, as UK holidaymakers will no longer have to put up with inadequate travel cover.

According to research commissioned by Direct Line and submitted to the Treasury review, there was overwhelming public support for this move, with 91 per cent of Britons in favour of regulation.

Since 1999, Direct Line has campaigned long and hard on this issue. It was the first insurer to speak out against travel agents being able to sell bundled insurance with holidays outside the professional, regulated environment all other sellers of insurance must work in.

Research has found evidence of mis-sold policies, as a fifth of holidaymakers who bought their insurance through an agent, travelled with a pre-existing condition – without knowing if they were covered.

This was due in part to poorly trained agents failing to ask the majority of their customers (55 per cent) whether they had pre-existing conditions. Should customers with pre-existing conditions have fallen ill overseas, their insurance would have been worthless. There was also evidence of misleading, high-pressure sales techniques, with one in six holidaymakers told – wrongly – that they would be unable to travel unless they took out insurance with the travel agent.

Chris Price, Head of Direct Line Travel Insurance comments: “Regulation will bring much needed protection to people with potentially life-threatening conditions. It will also establish a level commercial playing field, with all those who sell insurance now working under a common regulator.”