Travel insurance: full payout not forthcoming - why?

breaking_free

Hi all. I'll keep this as short as possible.

I received a partial travel insurance payout for curtailed travel (mother in law was on her deathbed so we had to quickly book new return flights).
I claimed for the cost of the new flights. The travel insurance company eventually paid out BUT the settlement figure was over £500 less than the cost of the return flights. 
Yes I understand that 2 x £75 excess was removed, so that partly explains it.

I have asked multiple times how this settlement figure was arrived at and every time they reply with "As per your claim's settlement letter, we have calculated the difference between your original and rescheduled arrival flight for 2 travelers."

They will not break it down mathematically and not provide any further explanation. As far as I can see, the "difference" between the new and original flights is the extra amount I had to pay Singapore airlines for the new flights (then the insurance deducts 2 x £75 excess). Today the insurance company has replied:

To confirm that your claim's settlement is incorrect, we kindly ask you to contact your airline provider and claim the original flight bookings, which you were unable to take.

However, if the airline provider states in their resolution report (final letter of your claim), that they will not refund any amount, please send the document to us and we will reassess your claim accordingly.

So...I shouldn't have bothered to take out travel insurance if you were going to tell me to claim my flights back from Singapore airlines?
In any case, I already approached Singapore airlines and have an extensive email trail turning down my request to reclaim the cost of the flights on compassionate grounds - so that is a dead end. I've sent this email trail to the travel insurance company this morning.

Does the travel insurance company have a right to tell me to claim from Singapore airlines? What's the point of paying them for insurance if this is their stance?

Thoughts please.

 

Caz3121

Insurance is to cover costs that are not recoverable elsewhere. I assume at the time they would not have known whether Singapore Airlines would refund anything for the unused ticket - now you have sent them confirmation that you are not due anything back from that route they should ".... reassess your claim accordingly."

breaking_free

Thank you Caz.
Seems odd that the insurer would pay out even a partial claim in that case. But hey, I'll await their next reply.

tightauldgit

Of course they do. The travel insurance is there to cover you for actual losses that you incurred. If Singapore Airlines is willing to refund you for the flights then you haven't suffered a loss on that part. If they aren't then you just need to provide that evidence to your insurer and they should then pay out for that portion of the claim. 

But it's not 100% clear from your post what you actually expect to recover, you seem to say that the insurer has paid out for 'the extra you had to pay for the new flights' which is all you should be covered for. 

So if you paid £500 quid for the original flight and then had to pay £500 for the new flight you are due £500 less the excess - you don't get the £500 quid for the new flights AND the original £500 refunded.

DullGreyGuy

tightauldgit said:

Of course they do. The travel insurance is there to cover you for actual losses that you incurred. If Singapore Airlines is willing to refund you for the flights then you haven't suffered a loss on that part. If they aren't then you just need to provide that evidence to your insurer and they should then pay out for that portion of the claim. 

But it's not 100% clear from your post what you actually expect to recover, you seem to say that the insurer has paid out for 'the extra you had to pay for the new flights' which is all you should be covered for. 

So if you paid £500 quid for the original flight and then had to pay £500 for the new flight you are due £500 less the excess - you don't get the £500 quid for the new flights AND the original £500 refunded.

To use some random numbers...

Original Flight £500
New Flight £750
Excess £0 just to make it easier.

The OP was expecting £750 back because that's the extra they paid to come back early however the insurer has only paid out £250 which is the difference in value between the two flights saying the original £500 needs to be recovered from the airline but if this is not possible to do then comeback to us.

This is perfectly reasonable as otherwise the OP could have gotten the £750 from the insurer plus the £500 from the airline meaning they are in profit from the situation. 

breaking_free

Thanks all. Here are the actual numbers.

Original ticket fare (minus taxes) London to New Zealand return: £1000 each so £2000 in total.
New return tickets (no additional taxes): £914.80 each so £1829.60
Unused allocated seats: £57
Insurance excess: 2 x £75 so £150
Expected payout: new tickets + allocated seats - excess   £1829.60 + £57 - £150 = £1736.60



The difference between what I expected and the actual settlement is £513.52. I cannot see how they have come to this total given the amounts I've provided above.

eskbanker

breaking_free said:

I received a partial travel insurance payout for curtailed travel (mother in law was on her deathbed so we had to quickly book new return flights).

The term 'return flights' can be ambiguous and will sometimes be used to denote both outbound and inbound legs of a round trip, whereas sometimes it will signify the inbound homeward leg only - presumably in a curtailment scenario you're using it in the latter sense?

breaking_free said:

Original ticket fare (minus taxes) London to New Zealand return: £1000 each so £2000 in total.
New return tickets (no additional taxes): £914.80 each so £1829.60

How much are the taxes on this flight?  Is it perhaps possible that they've deducted taxes from the refund in the mistaken belief that you'd have been reclaiming them from the airline?

breaking_free said:

Unused allocated seats: £57
Insurance excess: 2 x £75 so £150
Expected payout: new tickets + allocated seats - excess   £1829.60 + £57 - £150 = £1736.60

They do mention 'seats' in the description but again is it possible that they're not refunding these and are working out the difference between "original return flight + Seats" and "new return flight" in the sense that they're effectively deducting this from the refund rather than adding it?  Are there are policy terms that suggest such costs may not be reclaimable?

breaking_free

The term 'return flights' can be ambiguous and will sometimes be used to denote both outbound and inbound legs of a round trip, whereas sometimes it will signify the inbound homeward leg only - presumably in a curtailment scenario you're using it in the latter sense?

• Yes. I'm only thinking of the return flight.

How much are the taxes on this flight?  Is it perhaps possible that they've deducted taxes from the refund in the mistaken belief that you'd have been reclaiming them from the airline?

• Taxes were £199.96 per ticket so £399.92 in total.

They do mention 'seats' in the description but again is it possible that they're not refunding these and are working out the difference between "original return flight + Seats" and "new return flight" in the sense that they're effectively deducting this from the refund rather than adding it?  Are there are policy terms that suggest such costs may not be reclaimable?

• I've read the policy with a fine tooth comb; seats are refundable and the wording in their Item Description certainly suggests they are refunding the seats.

eskbanker

breaking_free said:

How much are the taxes on this flight?  Is it perhaps possible that they've deducted taxes from the refund in the mistaken belief that you'd have been reclaiming them from the airline?

• Taxes were £199.96 per ticket so £399.92 in total.

Perhaps it's just a coincidence, but a deduction of an amount ending in 92p from a whole number of pounds would result in a figure ending in 8p, like the one they've calculated - I can't make the maths work in full but it wouldn't surprise me if taxes were something to do with it.  However, it still doesn't seem unreasonable for you to expect them to show their workings rather than having to reconstruct them yourself!

breaking_free

Indeed @eskbanker. Thanks very much for your input.

I do have an update of sorts. I started their complaints process a few weeks back and had a reply this morning. I'll only post the highlights below (the whole email is rather lengthy).

• I refer to your recent communication. I am sorry to note the circumstances of your claim. I have now completed my review and would like to advise you that I will be upholding your complaint.
• You disputed the settlement amount and asked for the settlement to be broken down to better understand. I can see that you have been contacting us for updates and not gotten a response, I would like to apologise for this.
• I have passed your claim to the relevant team as a priority and they will be in contact shortly.
• In recognition of the service you have received, I would like to offer a payment of £50.00 to compensate for any distress or inconvenience we may have caused you. 

So in essence, I'm getting £50 compo and my claim is being passed along to yet another team to take another look at the settlement figure. I shall keep my fingers crossed and update once again when I hear from them.

breaking_free

UPDATE: Success! Just had a phone call from Axa to say I'd get my full payout with 7-10 working days.

The lady couldn't explain what had gone wrong except that whoever initially handled the claim simply didn't do their sums right. She was no wiser than me in figuring out how they'd got the "amount claimed" so badly incorrect.

Anyway, all is well that ends well.