Many travel insurance policies missing key ingredient

IMAGINE BUYING a product where part of the key ingredients is missing. Yet that is precisely the situation for millions who have purchased travel insurance but find a key omission which probably only comes to light when a claim is made.

Over two-fifths of travel insurance policies offer no protection for airline failure, according to the independent financial information business Defaqto.

This is alarming and should be one of the key elements in any travel cover. Its omission leaves holidaymakers with deficient policies exposed. Airline Flybmi is just the latest to collapse into administration. It registered its failure last Saturday as thousands headed away for the half-term break.

Less than half (48 per cent) of travel policies offer cover for airline failure as standard. It is offered as an optional extra in seven per cent of annual and single trip policies.

Anyone who has booked a package holiday where Flybmi is the designated carrier is fully protected through the ATOL scheme and should not lose out. Yet those who have booked flights directly and have not yet travelled are at risk.

Those paying for flights with a credit card should be able to obtain a refund from the card issuer.

So many tourists trusted Flybmi, which is the trading name for British Midland Regional. It was founded in May 1987 as Business Air and at one stage was owned by Lufthansa. It is a seriously important carrier with the Civil Aviation Authority revealing that the airline made over 29,800 flights and carried 540,315 passengers in 2017.

The trade body, the Association of British Insurers, should throw out any members who offer such inadequate forms of cover.

They should not do this quietly behind closed doors but name and shame those who let holidaymakers and business travellers down. The UK is known for its fairness and its time for such action.