Grounded flights lead to soaring payouts for insurance

♦ Thousands of Ryanair flight cancellations have pushed travel insurance payouts to their highest level in a decade.

Travel insurers paid £385million in claims in 2017, up from £369million in 2016, according to the Association of British Insurers (ABI).

This was the highest yearly payout since the Icelandic volcano eruption of 2010 triggered £455million in British travel insurance claims.

There were 510,000 claims last year, about one a minute, and up from 480,000 in 2016. A rise in trip cancellations was the main cause of the increase. Cancellation claims rose from £130million in 2016 to

£145 million last year.

Insurers said the main reason for this was airline Monarch going bust in October last year.

It left 110,000 travellers stranded overseas and forced the Government to undertake the largest peacetime repatriation in British history.

Ryanair flight cancellations in September 2017 also fuelled the rise in claims, with the low-cost airline cancelling 700,000 bookings.

At the time, Michael O’leary, its chief executive, blamed the cancellations on too many pilots being on holiday.

Bad weather was also behind the rise in payouts, with the ABI saying flooding across the UK in the winter of 2017 led many would-be travellers to put in claims after missing their flights.

Overseas, hurricanes Harvey, Maria, Irma and Nate also led to British fliers claiming compensation.

Around £240 million of the £385million of claims paid out came from travellers falling ill overseas, up slightly from £238million in 2016.

The average payout for medical expenses was £1,300, making it the most expensive type of claim.