Daily Mail

Thomas Cook: the final insult

Injured holidaymak­ers face financial hardship after insurance blunder by millionair­e bosses

- by James Salmon Affected by the Thomas Cook insurance blunder? Then email james.salmon@dailymail.co.uk

TAXPAYERS may be forced to compensate thousands of Thomas Cook customers injured on holiday because the tour operator failed to take out proper insurance.

In a final insult, the doomed tour operator only took out insurance to cover the largest personal injury claims, despite paying millions of pounds in bonuses to top executives.

The rest of the claims were paid out in cash from the company’s dwindling coffers.

This precarious arrangemen­t, which went on for years, meant the vast majority of claimants were not covered by insurance when the 178-year-old travel firm collapsed in September.

Describing this as an ‘extraordin­ary situation that should never have arisen’, Business Secretary Andrea Leadsom said it included customers who have suffered serious injuries and loss of life.

In a statement in the House of Commons, she explained they are currently being treated as ‘unsecured creditors’, meaning it is ‘very uncertain whether they will receive any of the compensati­on they would have ordinarily received against their claims’.

Thousands of people are understood to be affected, as Thomas Cook’s insurance policy only covered claims of more than £5m.

Among those who stand to lose out are bereaved relatives battling for compensati­on and people receiving regular payments for serious injuries which have been cut off since the collapse.

Leadsom said: ‘This raises a potentiall­y unacceptab­le prospect for some who face significan­t hardship through no fault of their own where Thomas Cook should have rightly provided support; customers who have already suffered life-changing injuries or illness and who may face financial hardship as a result of a longterm loss of earnings or significan­t long-term care needs.’

The Government intends to set up a taxpayer-funded compensati­on scheme to provide support for customers ‘facing the most serious hardship’.

Several high-profile tragedies have befallen Thomas Cook holidaymak­ers. Among them are Bobbi and Christi Shepherd – two young children who died of carbon monoxide poisoning while on holiday in Corfu in 2006.

Thomas Cook’s lack of insurance may have implicatio­ns for the family of British couple John and Susan Cooper, who died in Hurghada, Egypt, last year.

The cause of death has still not been determined, although a court heard in May that the couple may have been exposed to an ‘infectious biological agent or toxic chemicals’.

Laws needed to set up the compensati­on scheme will be introduced after the general election, if the Tories hang on to power.

The interventi­on comes as a scathing report by the Parliament­ary business committee accused

Leadsom of an ‘extraordin­ary lack of interest’ in Thomas Cook before the collapse. It emerged that she did not meet executives as it teetered under a mountain of debt.

Accusing bosses of ‘passing the buck’, committee chairman Rachel Reeves said directors and senior managers ‘pocketed hefty sums in salaries and bonuses’.

Former boss Peter Fankhauser also came under pressure to hand back a £585,000 bonus during the committee’s inquiry.

 ??  ?? Holiday blues: Former boss Peter Fankhauser is under pressure to hand back a £585,000 bonus
Holiday blues: Former boss Peter Fankhauser is under pressure to hand back a £585,000 bonus

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