Almost half of UK consumers are prepared to make fraudulent illness claims against tour operators when approached by rogue claims management companies in resort, new research reveals.
The findings follow the travel industry being hit by a dramatic rise in gastric illness compensation claims which have now reached “epidemic” levels.
Unscrupulous claims management companies urging holidaymakers to lodge speculative claims against operators and hotels are now posing a threat to the whole travel industry, a law firm warns.
The Hospitality Business Association of Benidorm, Costa Blanca and Valencia alone says fraudulent sickness claims are costing the sector €60 million a year and Abta has voiced its concerns.
Insurance and risk law firm BLM commissioned YouGov to survey 2,000 consumers on their attitudes to sickness claims on all-inclusive holidays, after it saw claims against travel firms soar over the past 12 months.
The poll found that 46% said it would be acceptable to make a claim for food poisoning even if they were not sure their illness was the fault of the hotel, a belief that has helped create a thriving fraud culture, according to BLM.
The firm found that 5% of people have received an unsolicited call about making a claim against a holiday company, and 5% of those on all-inclusive breaks have been approached to make a claim while on holiday.
Claims management companies are also targeting those that are likely to be more vulnerable to committing fraud, with 15% of all-inclusive holidaymakers with two or more children having been approached while abroad – some with the potential to pay for next year’s holiday on offer.
BLM warned in a research paper into the issue that “the more targeted these rogue companies are, the more success they will have. We’re certain that if we were to run this survey again in a year’s time the figures will shoot up”.
Sarah Hill, partner and head of fraud at BLM, said: “It is not exaggerating to call this situation an epidemic. Claims management companies have identified this as fertile ground and there is a deep pool of potential claimants up for grabs.
“There needs to be some level of consumer education, as almost half of those surveyed think this practice is acceptable. In reality, it is against the law and is pushing up holiday prices.”
She added: “Payouts typically range between £500 and £2,000, and many people are seeing this as a quick and easy way to make some money, with claims management companies assuring their targets that they are entitled to make these claims.
“The industry needs to come together with government to develop a solution to this issue. It needs addressing in the same way whiplash claims were, with regulation that drives rogue claims management companies out of the market.
“If left unchecked, this could threaten the future of the travel industry.”