COVID-19 hits public trust in travel insurance claims handling – CII

The Chartered Insurance Institute’s Public Trust Index has found trust in the travel insurance claims process has collapsed during the COVID-19 pandemic, although there is greater confidence in motor insurers’ abilities to settle claims swiftly.

The index measures the gap in expectations for key measures on a scale of plus or minus 30.

For travel insurance, the expectation gap has widened on several key statements, representing a significant deterioration in trust.

The gap around the statement, “The insurance company does not try to avoid paying out,” widened from 2.97 at the beginning of 2020 to 8.24 in September 2020.

The score for the statement, “I can get through to the insurance company quickly at any time” went from 1.94 to 11.89 over the same period.

In contrast, motor insurance saw an improvement in its expectation gap.

The score for the statement, “The insurance company does not try to avoid paying out” reduced from 10.93 to 7.21, while it narrowed from 11.49 to 6.32 for the statement, “I can get through to the insurance company quickly at any time”.

Matthew Connell, director of policy and public affairs at the CII, said: “2020 saw huge changes in people’s lifestyles. We have been travelling less, for example, average motor claims reduced by 48 per cent in the second quarter.

“The reduced demand for claims services does seem to have resulted in a significant improvement in service, with customers reporting that it is easier to get through to firms and that they are less likely to be unhappy with the result of their claim.

“In contrast, travel insurance, which has traditionally had a very high level of trust in its claims processes has suffered, as holidays continued to be disrupted throughout 2020. The fact that many airlines directed customers to claim on their insurance instead of paying out statutory insurance straight away has undoubtedly had an impact on levels of trust.”

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