Cyprus Mail

Coronavirus: Travel agents have not covered insurance obligations

The Cyprus consumers association said on Tuesday it had emerged through issues connected with the pandemic that some travel agents had not adequately covered their insurance obligations and it called on the commerce ministry to look into it.

Over the past few weeks it has been realised that travel agents are not obliged to refund customers except in the event of bankruptcy, and that the guarantees they must lodge with authorities do not cover the pandemic situation.

In the course of examining complaints over cancellations due to the coronavirus travel ban, and the dearth of refunds, it has emerged that some travel agents have not even adequately covered the guarantees necessary in the event of a bankruptcy.

“According to the relevant legislation travel organisers are obliged to have insurance coverage or a bank guarantee that fully covers consumers in case of bankruptcy or insolvency,” the Consumers Association said.

“Unfortunately, after all the problems that have arisen with the offer of vouchers instead of the full refund of the money that consumers have paid for cancelled trips, another issue has appeared at the expense of consumers.”

The association said that at least some agencies were in violation of the law and have not lodged the required amounts to cover holiday guarantees.

It said that its information for one specific travel agent showed the company had submitted a guarantee covering only 10 to 15 per cent of the required amount.

The association said it has submitted a complaint to the ministry of commerce’s consumer protection service.

It added that the ministry be appointed as the body to manage the guarantees system for travel agents, and not their own representative body.

“An association cannot manage the guarantees of its own members,” the consumer watchdog said.

“This contradicts the rules of good administration and transparency. The minister, in case the complaint of the Cyprus Consumers Association is proven, will have to assume its responsibilities and take corrective measures,” it added.

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