...and don’t bank on your travel cover cash either

HOLIDAYMAKERS are being denied refunds worth hundreds of pounds for travel insurance policies they can’t use.

Unlike home and car insurance, where policyholders can get a partial refund if they cancel early, travel cover is typically non-refundable.

This has left customers facing a lottery. The most generous firms are offering customers some, or even all, of their money back. Others have promised credit notes or said they will extend the cover for future travel. But many have said customers cannot have anything.

Travel cover can be expensive for older travellers and those with medical conditions, particularly when travelling outside Europe.

Barbara and Stephen Dudley paid £1,690 for a single-trip policy last December for their holiday to America in June. After the trip was cancelled in April, the couple, who live in Castleford, West Yorkshire, rebooked for next May.

But their insurer Avanti refused to refund or extend their cover beyond January. Instead, it offered them a new discounted policy costing another £690, which they reluctantly accepted. Avanti has since extended its policies by 18 months but the couple are not eligible.

Barbara, 62, says: ‘I do not know how it can justify keeping so much of our money as well as tying us in.

‘It made me feel as if I should be grateful for getting anything.’

Insurers have already come under fire for refusing to pay claims for cancelled holidays and revoking cover for anything related to Covid-19. The Financial Conduct Authority says it expects firms to take ‘appropriate action’ when the value of insurance policies falls. This could be reducing premiums or partial refunds.

Martyn James, from complaints website Resolver, says: ‘Unlike flights or packaged holidays, there’s no law governing refunds for insurance contracts if they become useless because you can’t travel.’

He recommends trying to negotiate with insurers and putting requests in writing. If you think you have been treated unfairly, contact the Financial Ombudsman.

A spokesman for trade body the Association of British Insurers says: ‘It is a commercial decision for insurers to offer full or partial refunds in light of Covid-19.’