Gov’t Travel Advice Provides Clarity For Insurers, Group Says

Law360, London (March 17, 2020, 4:54 PM GMT) -- The U.K. government’s Tuesday advice against nonessential travel abroad during the coronavirus pandemic provides “welcome clarity” for insurers as it allows them to pay out for claims from holidaymakers for disrupted trips, an industry group said.

The Association of British Insurers, the voice of the U.K. industry, said Tuesday that Foreign Secretary Dominic Raab’s advice against travel overseas for an initial period of 30 days, in response to the COVID-19 disease, will allow travel insurance policyholders to make claims for canceled holidays.

“This unprecedented step actually provides welcome clarity for our customers and the industry,” the ABI said in a statement. “This decision will therefore allow policyholders with cancellation or travel disruption cover in place to claim for cancelled trips that were already booked and cannot now go ahead.”

In response to the pandemic, British insurers have begun scaling back the scope of travel insurance or have stopped selling new policies outright. But they will be required to pay out for existing travel policies that cover pandemics.

The Foreign & Commonwealth Office said Tuesday that the travel advice would take effect immediately and comes in response to the pace at which other countries are either closing their borders or implementing restrictive measures in response to the virus outbreak.

Although the British government said that it is a personal decision as to whether travel is essential, those who choose to go abroad may not be able to get back into Britain if further restrictions are put into place.

Those who are currently overseas should also be aware that their flights home may be canceled at short notice if restrictions are put in place by foreign governments.

“U.K. travelers abroad now face widespread international border restrictions and lockdowns in various countries,” Raab said Tuesday. “The speed and range of those measures across other countries is unprecedented.”

Travel in and out of Britain has already fallen by a significant amount since the outbreak of the COVID-19 disease that first appeared in late 2019 in Wuhan, China. Ryanair, Virgin and EasyJet have cut flights by 80% this month and IAG has decreased capacity by 75%, the British government said Tuesday.

--Editing by Rebecca Flanagan.

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