Holidaymakers get hit by the small print in policies

(AFP )

Travellers are being routinely let down by their holiday insurers, according to consumer group Which? New research shows that insurers operate vastly different policies when it comes to paying out claims.

For example, only 41 per cent of insurers will cover the policyholder if their airline goes out of business, while 18 per cent pay in cases of holiday disruption due to a terrorist act.

"Holidaymakers tend to assume that if they've taken out travel insurance, they'll be covered for disasters beyond their control – an airline or hotel chain going bust, or getting caught up in an act of terrorism. Sadly, our research has found that's not always the case," said Rochelle Turner, a researcher at Which?.

"The travel insurance industry must up its game and start to provide policies customers can rely on, or at least make their policies clear rather than hiding exclusions in the small print."

In response, the Association of British Insurers (ABI) said that policies differ for good reasons. ABI spokesman Malcolm Tarling said, "You can't just have an identikit policy for everyone. For starters, if you covered everything the policy would be too expensive for many. Look at the stats produced by the financial ombudsman service: on average there is one dispute for every 12,700 policies sold. Insurers have to make their terms and conditions clear. The onus is on the purchaser to ensure it covers what they need."