Over the last three years, the number of people claiming compensation because they say that they have fallen ill on a holiday overseas has sky-rocketed by over 500%. Over this same period, the actual number of sickness cases reported in resorts has either remained stable or gone down and the problem is only associated with UK holidaymakers.
There is strong evidence to suggest the majority of these claims are exaggerated or fraudulent. Some unscrupulous Claims Management Companies (CMCs) have been witnessed encouraging holidaymakers to submit fraudulent or exaggerated claims and coaching people on what to say to make a claim. This is similar to what they did around whiplash claims, which caused car insurance premiums to rocket.
The CMCs take a cut of any award made and the firms of solicitors they work with also add their legal fees, further driving up the costs of claims. The cost to tour operators, insurance companies and overseas hotels is substantial. A hotel association in Mallorca recently revealed that the cost to their members alone was £42 million last year. Hoteliers in Spain and Turkey have said they may have to stop offering all-inclusive package to British tourists because of the devastating financial impact fake claims are having..
Inevitably, if this problem isn’t stopped then just like the false whiplash claims, it will result in higher prices for everyone.
The Stop Sickness Scams campaign is urging the Ministry of Justice to close a loophole in legislation that was introduced to help stop the surge in fraudulent “whiplash” claims, but which excludes overseas claims. A simple amendment would bring the travel industry into line with other sectors, and place a limit on the legal fees that can be charged by law firms pursuing these cases.