NEW YORK -- Standard travel insurance policies don't mention
blackouts, either as a covered hazard or as an exclusion, meaning
an event that is not covered.
However, industry insurers are treating the Blackout of 2003 as
something akin to a natural disaster or bad weather, events that
trigger protection under the terms of trip delay or, sometimes,
trip interruption or trip cancellation clauses.
Therefore, coverage for blackout victims kicks in provided the
delay lasted a minimum number of hours (often six, sometimes more),
and other standard terms apply in the cases of interrupted or
canceled trips.
Generally, the insurers have not been and don't expect to be
overwhelmed by the blackout.
Beth Godlin, senior vice president, travel industry sales and
marketing, Access America, said her company -- which can receive
claims on the Web -- saw its first claims on Aug. 15 while the
lights were still out in much of the affected area.
She said the early claims, in the first weekend, were for
canceled trips, lost because travelers could not join their tours.
Most later claims, however, are expected to be related to trip
delays.
She said Access America is projecting claims of $100,000 to $1
million, a big range, because "we don't know!"
She said it bodes well that airports were closed only one day,
but, on the downside, "lots of cities" were affected and New York
is a big hub.
Travel Guard, the largest insurer, said it expects 8% to 10% of
its insured travelers to make claims, mostly for delayed trips. The
company averages 105,000 insured clients a day, and that could
translate into more than 8,000 to 10,000 claims.
The company's Livetravel 24-hour emergency service reported call
volumes from Thursday night of the blackout into Saturday at 40% to
60% higher than normal. Most callers were looking for help
rebooking flights, or checking the status of flights.
A Travel Guard spokesman compared the spike in activity to
2003's big snowfall in the Northeast.
Judy Sutton, director of product development for Travel Insured,
said the company was prepared for a flood of calls that did not
happen. As for a possible explanation, she said, "I have to believe
suppliers made this a nonevent" by taking care of travelers.
Travel Insured has seen an "insignificant" number of claims so
far and does not expect a drastic change, though there may be a
batch of claims after people return from trips that were partially
disrupted, Sutton said.
CSA, said Claudia Fullerton, vice president and chief operating
officer, saw a temporary increase in calls, but "not on a large
scale," at its 24-hour emergency service line.
She said CSA does not expect the impact from the blackout to be
big, and it expects most claim amounts to be "minimal."
Similarly, Sheri Machat, senior vice president, M.H. Ross Travel
Insurance Services, said the insurer does not expect "an
overwhelming number of claims."
She said, based on calls to the company's toll-free customer
service line, this will be "a very low-impact event" compared with
a weather delay or the failure of a travel supplier.
To contact Nadine Godwin, send e-mail to [email protected].