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06/05/2005: "Insurance Chill Leaves Travellers in the Cold"

Insurance Chill Leaves Travellers in the Cold by Rosanna Spero

Tens of thousands of travellers have been left without cover after insurance intermediary Whiteley Insurance Consultants was forced into liquidation by the Financial Services Authority (FSA)

The firm, which also traded as Kingfisher Travel Insurance and Kingfisher Insurance Services, is the first to be forced to close its doors after the FSA took over the regulation of the general insurance in January this year.
The firm was selling policies without having them properly underwritten, so customers often had no insurance. The liquidator Pricewaterhouse-Coopers is in talks with the Financial Services Compensation Scheme (FSCS) to see if people can get any outstanding claims paid or their premiums refunded should it find the firm is insolvent.

If the FSCS can step in, it will apply only to policies bought after January 14th, when the FSA took over regulation of general insurance. And it is unclear whether policies bought via a travel agent - which are exemp from FSA regulation - will be covered at all.

According to Pricewaterhouse-Coopers, not all travel policies sold by Whiteley or Kingfisher are worthless. Royal Liver has said it will pay all claims and people with plans underwritten by Travel and Personal Underwriters, Gouda International and ACE European Group are covered until May 6th.

However, people with policies which claim the underwriting is by 'a panel of insurers' or ARISA Assurances SA need to buy alternative cover. The name of the underwriter is printed at the top of the policy and policyholders with MMA Insurance and Union Reiseversicherung AG should contact the firm directly or phone the helpline on 08705 234 803. Airline failure policyholders with plans referring to IGI Insurance Company or Compass Underwriting also need to contact the helpline.

If the travel insurance was bought using a credit card and cost more than £100, policyholders should make a claim under section 75 of the Consumer Credit Act wich makes the car company jointly liable with the retailer if a good or service is below standard or not delivered.

You can claim the cost of the premiums but not any outstanding claim.

(this article was taken from the DailyMail and the author can be reached by email at r.spero@dailymail.co.uk)