The Government has issued a call for evidence from the travel industry as it looks to curtail the UK’s “holiday sickness claims culture”.
The Ministry of Justice (MoJ) has said that bogus travel sickness claims are costing the sector millions and risks pushing up prices for law-abiding holidaymakers. The Association of British Travel Agents (ABTA) has reported a 500% increase from around 5,000 claims in 2013 to around 35,000 claims in 2016. This is despite the fact that travel industry data on the global trend for reported incidence of illness in resorts has actually declined in recent years. The Government says that this rise has not been seen in other European countries and has raised questions over the scale of bogus claims.
ABTA has also found that while the average value of a gastric illness claim is about £2,100, the average cost of defending a claim is almost £3,800. The projected total cost of claims to the industry in 2016 (including damages paid) has been estimated by ABTA to be over £240 million.
Ministers want a greater insight into the reported rise in suspected false insurance claims for gastric illnesses like food poisoning being brought by British holidaymakers. This will be used to help Ministers identify next steps to tackle false claims. The call for evidence will ask the industry and others to submit a wide range of information, from the volumes of claims to the amount of damages awarded.
Justice Minister Dominic Raab said: “Bogus claims against tour operators risk driving up the price of summer holidays abroad for hard-working families who have earned a break. We’re taking action to deter these claims, and protect holiday-makers from being ripped off.”
The call for evidence, which will remain open for four weeks, follows Government action over the summer aimed at reducing cash incentives to bring spurious claims against package holiday tour operators.
According to the MoJ, holiday operators often settle holiday sickness claims out of court, rather than challenge them because – due to the fact these spurious claims are arising abroad – legal costs are not controlled, so costs for tour operators can be out of all proportion to the damages claimed.
Ministers have put forward proposals which would mean tour operators would pay a prescribed sum depending on the value of the claim, making defence costs predictable and helping to deter bogus claims.
These proposals will be considered by the Civil Procedure Rule Committee and may be brought into force early next year.