Travel Insurance Cancelled by Insurance Company 5 days Before Holiday

Grumpy_chap

Voyager2002 said:

The premium for a single trip policy reflects the total risk for that policy, rather than the risk for one of its components. The risk associated with cancellation cover is small when compared with the risks of theft, medical incidents, accident and so forth during the actual holiday. We can see this, because the premium does not go down if insurance is taken out just before departure rather than many months in advance, confirming that the marginal cost of an additional month of cancellation cover is too small to be priced.

In any event, the insurer decided to cancel the policy, and there were no claims, so a full refund would be appropriate.

I suspect, if the truth be told, the actual risk premium for a single trip (or, indeed, any) travel policy is a very small part of the policy cost, hence the reason why the premium does not vary much between one year or one week ahead of travel. 

My wife and I currently have an annual policy, with medical conditions declared, and the premium was under £60.  Frankly, most of that cost must go in the basic administration of the policy being created and receiving the payment.  The amount left over to go towards actually insuring risk must be miniscule.

Pete_O

During my call with Admiral earlier I stated that as this was a single trip then surely the only cover they were providing before the trip takes place was for cancellation but didn't get anywhere.  As for risk, as Admiral is a trading name of EUI Ltd, and EUI are an intermediary and not an underwriter, I asked if I could have details of the underwriters on the policy.  They refused to give me any!  So i have now raised another complaint with them that as I was (at the time) a customer of their's I had a right to know who the underwriters were on the policy.  Their response time for that complaint is up to 8 weeks.

Not sure where to go with the refund issue now if I'm honest.

I do intent to write a scathing letter to their CEO and hand deliver it to the offices on David Street In Cardiff next time I'm in my home town/city.  I doubt it will get me anywhere but it will give me some satisfaction as I'll add a note to it telling the said person what they can do with it when they've finished reading it!!

diveunderthebonnet

Grumpy_chap said:

Voyager2002 said:

The premium for a single trip policy reflects the total risk for that policy, rather than the risk for one of its components. The risk associated with cancellation cover is small when compared with the risks of theft, medical incidents, accident and so forth during the actual holiday. We can see this, because the premium does not go down if insurance is taken out just before departure rather than many months in advance, confirming that the marginal cost of an additional month of cancellation cover is too small to be priced.

In any event, the insurer decided to cancel the policy, and there were no claims, so a full refund would be appropriate.

I suspect, if the truth be told, the actual risk premium for a single trip (or, indeed, any) travel policy is a very small part of the policy cost, hence the reason why the premium does not vary much between one year or one week ahead of travel. 

My wide and I currently have an annual policy, with medical conditions declared, and the premium was under £60.  Frankly, most of that cost must go in the basic administration of the policy being created and receiving the payment.  The amount left over to go towards actually insuring risk must be miniscule.

You must be covered up to your front door only  ,only kidding but that is peanuts for a annual policy for two people

Grumpy_chap

diveunderthebonnet said:

You must be covered up to your front door only  ,only kidding but that is peanuts for a annual policy for two people

Well, Europe only policy and no extras like winter sports, cruise or such like.
Still, the amount to cover the actual risk of a claim must be pennies.

Pete_O

Just been told by a relative to take my case to the Financial Ombudsman.  Anybody have any experience of taking cases to them and if I'd have a chance of getting anywhere?

Grumpy_chap

Typically, it is only possibly to go to an ombudsman after exhausting the complaints process of the provider and reaching deadlock.
Is the Financial Ombudsman the correct one to consider?

dunstonh

Pete_O said:

Just been told by a relative to take my case to the Financial Ombudsman.  Anybody have any experience of taking cases to them and if I'd have a chance of getting anywhere?

Did that relative also tell you that you have to wait until the 8 weeks is up or you have received the final response?

Anybody have any experience of taking cases to them and if I'd have a chance of getting anywhere?

The FOS is an independent arbiter for complaints if you disagree with the outcome of the complaint from the firm.   
There is insufficient information on this thread to say what the FOS will do but as it stands, you don't appear to have given any indication of wrongdoing.       They appear to have followed this: