COVID-19 Travel Cancellations and Refunds Guidance
Cancellations of holidays, trips and events has become common place as a result of the COVID-19 pandemic. In these circumstances, consumers are likely to be entitled to claim a refund from the travel service or provider.
In June 2020, the FCA opened consultation on guidance published aimed at assisting consumers to identify their options around claiming a refund for any cancelled travel or event, as a result of COVID-19 as quickly and effectively as possible.
The FCA proposes measures which should be effective for six months following the publication of the final guidance, which was published on the 1st October.
The guidance sets out what is expected from insurance providers and card providers to help consumers when they are claiming for a cancelled trip/holiday or event in order to produce the best possible outcome for them.
The guidance applies to any situation where an insurance provider refers a consumer to a card provider for a claim; for example, a chargeback claim or claim covered by Section 75 of the Consumer Credit Act (section 75 claim).
In line with the proposals, insurance firms will be expected to:
- Take reasonable steps to minimise the referral of customers to card providers, where this would not be in their best interests (e.g. where the customer is unlikely to have a valid claim)
- Explain to their customers why they are requesting they contact their card provider first (where relevant)
- Explain to their customers the benefits of claiming with their card provider, and why this may lead to a better outcome for them.
In addition to the guidance, the FCA will also work with the Money and Pensions Service (MaPS) to deliver the messages to consumers to increase their awareness of the options available to them.
If you have any questions or concerns, please don’t hesitate to speak to your BDM.