Travel insurance coronavirus payouts set to top £275m, says ABI
The Association of British Insurers (ABI) has revealed its initial estimates of travel insurance payouts to policyholders affected by the coronavirus lockdown.
ABI estimates no less than £275 million to be paid out to customers in COVID-19 related claims. The vast majority of these payouts will be for cancellations, with some for disruption costs incurred overseas.
The payouts are expected to be at least twice as much for cancellation than for the whole of 2019. This is easily more than the highest annual figure for cancellation payouts - £148 million paid in 2010, said ABI.
According to the trade body, at least 400,000 coronavirus claims are expected, compared to the 294,000 cancellation and disruption claims received in the whole of 2010, the previous highest year on record for such claims.
The coronavirus payouts dwarf the £62 million cancellation and disruption payments following the Icelandic volcanic ash cloud in 2010.
Meanwhile, ABI's travel insurance members have made several pledges to ensure extra support for customers, including having in place contingency plans to deal with valid claims as quickly as possible.
Mark Shepherd, ABI’s assistant director, head of general insurance policy, said: “At this unprecedented time, travel insurers are helping soften the financial blow for thousands of customers whose travel plans have been cancelled or disrupted by Coronavirus. Along with compensation from sources, such as airlines and credit card providers, travel insurers are helping customers get through these tough times.”
