Playing the claims game
INSURANCE customers are waiting months to get claims settled due to the pandemic, as insurers drag their feet or squabble over who should foot the bill.
Travel insurance claims are subject to extended delays, as insurers, airlines, tour operators and banks try to shift liability to each other.
General insurance claims for motor or home policies are being affected, as companies struggle to cope with a surge in activity. Covid19
is now behind more than four in 10 insurance claims, more than half of them travel-related, according to research fromWhich? the consumer champion.
It asked 95 members to track the progress of their insurance claim, and many reported being left on hold for hours, or waiting weeks for details.
This is despite guidance from the Financial Conduct Authority, designed to make it simpler for consumers to recover lost costs after cancellations.
Stephen Cohen, 72, had to wait five months while British Airways, card provider Lloyds Bank and insurer AXA disputed liability for his unused return flight, after he cut short his trip to Malaysia and Japan in March due to government advice.
Lloyds eventually recovered £226 from British Airways by chargeback, but retired TV producer Cohen, from Skipton, said loyal customers deserve better service: “The whole process is a farce.”
AXA said it has experienced a surge in travel claims 10 times bigger than the travel insurance industry’s last major disruption, the 2010 Icelandic ash cloud, due to Covid-19.
LV=customer Stephen Kramer claimed on his home insurance policy after a car crashed into his home in January. Repairs had not been completed by late March, when lockdown brought work to a halt, forcing him to do emergency repairs.
By July, he was still waiting to hear: “I couldn’t use my upstairs bathroom, the septic tank was damaged, and trespassers had tried to enter through my damaged garden wall.”
LV= apologised afterWhich? got in touch and offered Mr Kramer £300 in compensation, while the work is now back on track.
AnotherWhich? claimant spoke with nine staff at a travel insurer in a call lasting 70 minutes, just to get a claims form.Which? Money editor Jenny Ross said customers should not have to suffer such excessively long waits: “We expect the industry to step up its game to ensure the process is as efficient as possible.”
She urged claimants not to give up: “Whether it’s battling through extended hold times, submitting and resubmitting documents, or disputing how your claim has been assessed, for many persistence has paid off.”
Patrick Ikhena, head of travel at CompareTheMarket.com, said travellers should still buy insurance: “Traditional policies act as important safeguards against common mishaps such as lost or stolen luggage.”
Enhanced Covid cover policies should pay out if you contract coronavirus before travel and need to cancel, or require emergency medical care and repatriation from abroad. He added:“Cover varies by provider, so always check.”