Travel Agent Business Protection
May 5, 2021
The extraordinary events of 2020, and the uncertain path of the pandemic has created significant challenges for the Travel industry and its associated support services.
Travel Agents are consequently having to make adjustments to their business in order to survive. Whilst any cost is a challenge, it is important that Travel Agents continue to keep their business protected.
Professional Indemnity Insurance
As a Travel Agent, being an AFTA member or ATAS participant, both Public Liability and Professional Indemnity insurance are mandatory.
Professional Indemnity Insurance provides protection if you are found to be legally liable for inaccurate, incorrect or misleading advice while conducting your professional service as a Travel Agent/Travel wholesaler which results in a customer or other party suffering a financial loss. It can also cover legal costs and expenses incurred in your defense.
Travel Agents are specialists in their own professional field. The law requires that you exercise the required skill to an appropriate level expected from Professionals such as yourselves. Your liability arises when you fail to provide this level of skill, which could result in an award for damages being given to a third party who suffers the loss. You too need to have this insurance to cover you for alleged breaches of your Professional Duty.
Professional Indemnity Insurance will compensate for the damages awarded against the Insured plus any costs or expenses incurred in defending the claim brought against you, (subject always to the terms, conditions and exclusions contained in the actual policy).
There are many components to a client’s trip that can go wrong. Unfortunately, when things don’t go to plan, the first thing that comes to mind is to fault the agent, whether you are responsible or not.
It is important to understand your Professional Indemnity Policy is a “Claims Made” policy. All “Claims Made” policies require you have a policy in place when a claim is made. Sometimes there can be a large gap in time between when the actual or alleged failure occurred and when the claim is first brought against you. At a time when no one is travelling, as a result of COVID 19, there is a misconception that this insurance is not required –If you have let your policy lapse, you should investigate obtaining a replacement policy as a matter of urgency.
The policy is there to protect you in the event that you make an error or a misrepresentation which causes your passengers to suffer a financial loss.
Public Liability Insurance and Business Insurance
Public and Products Liability Insurance provides cover in the event you are legally liable to pay compensation for personal injury or property damage.
This insurance covers you for your legal liability for bodily injury or property damage to third parties, including clients. These injuries may be a result of falls, bumping someone inadvertently, or accidentally damaging the property of others. These injuries can arise either at the business office, the business office contained within a residence, or away from the office while fulfilling the duties of your business.
Should an incident occur, and you do not possess adequate liability insurance, you will need to produce your own defense, often a costly exercise. Any damages awarded to third parties will need to be funded from your own resources which may involve the liquidating of assets, both business and private.
Public Liability insurance excludes the following:
- Any unlawful activity
- Any deliberate act to cause damage or injury
- Personal injury to you or your employees
- Property damage suffered by you or your employees
Business Insurance is a combined policy that can cover a range of different risks, including fire and accidental damage for your contents and office fit-out, business interruption, burglary cover, money cover, glass cover, machinery breakdown, and electronic equipment breakdown. Business Insurance may also include your Public Liability insurance.
If you are working from home, it is recommended that the Travel Agent contacts us to discuss their options, as they may no longer need Business Insurance cover, and can transfer any Public Liability cover they have under their Business Insurance Policy to their Professional Indemnity cover.
If you are still working from the office, there may be certain covers under your Business Insurance Policy that can be removed or reduced to help save costs during this time.