A specialist travel law firm has warned tour operators and travel agents face a significant rise in compensation claims during the recession.
Firms have been urged to ensure they have liability insurance and indemnity agreements - to ensure they can deal with a barrage of anticipated claims.
Travlaw, which has rebranded from Stephen Mason Solicitors, has seen a "noticeable increase" in travel claims, both consumer and commercial, in the last three months as a result of the economic situation.
These vary from consumers claiming holidays were poor quality, illness or injury on holiday to company disputes with commercial partners for failing to pay bills or claims related to staff redundancies and unfair dismissal.
Managing partner Stephen Mason said: "It's a double whammy for the travel industry. On the one hand they are facing more claims and on the other they have fewer staff to deal with them.
"It's been a pattern in the last few economic bad times. When times are hard and affording a holiday is pushing the budget, claims are much more likely."
Small to medium-sized travel companies are most at risk, he said.
"Bigger companies have quite sophisticated systems and are aware of employment law, but some small and medium-sized companies are often aghast at what employment law or liability claims require of them."
Agents selling dynamic packages could be among those hardest hit. "Some agents are not aware of their potential liability for consumer claims, and anyone who is a principal must have liability insurance otherwise frankly they are inviting disaster," he said.
Claims can range from hundreds to tens of thousands of pounds.
As claims increase, Travlaw has increased its size and now has three partners instead of one. The new name aims to highlight the company's focus as a travel specialist and reflect a more modern approach, added Mason.
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