Holiday sickness fraudsters have been dealt a significant blow after new rules to bring pay-outs under control were given the go-ahead.
The rules will fix the legal costs that can be claimed in package holiday sickness claims, closing a loophole which the travel industry believes has helped fuel a rising number of claims. Up until now, legal costs in overseas package travel claims have not been controlled, which has meant costs for tour operators can spiral out of all proportion to the damages claimed. This has led many operators to settle holiday sickness claims out of court, rather than challenge them.
Industry experts believe this has been a major factor in a rise in claims which has sparked concerns that Britain’s reputation overseas is being damaged, being referred to as the ‘fake sick man of Europe’ and that British tourists will face higher package holiday prices.
By 2016, claims were coming in at a rate of 100 per day. Travel firms said costs had climbed to £240m in a year and warned that prices would have to rise to cover the cost of claims.
Justice Minister Rory Stewart said: “Claiming compensation for being sick on holiday, when you haven’t been, is fraud. This damages the travel industry and risks driving up costs for holidaymakers. This behaviour also tarnishes the reputation of British people abroad. That is why we are introducing measures to crack down on those who engage in this dishonest practice.”
The Association of British Travel Agents (ABTA) reports a 500% increase from around 5,000 claims in 2013 to around 35,000 claims in 2016. This is even though travel industry data on the global trend for reported incidence of illness in resorts has declined in recent years.
Since October 2017, four couples were either sentenced or ordered to pay significant legal costs by the court after making false package holiday sickness claims. These cases were private prosecutions brought by tour operators Thomas Cook, TUI and Red Sea Holidays.
The rules will come into effect in the coming weeks - ensuring the curbs will be in place before the next summer holiday season.
