Helping specialist tour operators and activity providers with travel ecommerce
Insurance and Financial Protection
Dear All,
I am very glad I found this forum. Last year, I set up a company that organsies and delivers guided tours for schools and private groups to WW1 Battlefields. Schools are asking for my public liability insurance and what financial protection they have if I become insolvent.
Can someone please advise on this? I am a very small company, just starting out and already have run some excellent tours and people are being referred to me. So now, I need to sort this.
Kind regards,
Steve Garnett
Views: 204
Replies to This Discussion
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Permalink Reply by Steve G on -
Just to add, that I am very much lost in all the information I am reading!!!
Thank you so much in anticipatiom!
Steve Garnett
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Permalink Reply by Matt Purser on -
Hi Steve
Public liability insurance protects you as a business, in case any one has an accident on one of your trips and they decide to sue you and/or your business. The schools want to ensure that adequate insurance is in lace and therefore wish to see a copy of your insurance policy.
With regards to financial protection, there is an European directive that says, if any travel business is selling two or more elements (e.g. Transport and accommodation), they need to provide financial protection to ensure that the customer would receive a refund or be repatriated, if the travel business was to cease trading.
This financial protection can include trust accounts, insurance or bonds.
It sounds like you do need to do this but the best option will depend on how many passengers you will send each year, the average price and whether flights are included.
Hope this helps
Matt
www.traveltradeconsultancy.co.uk
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Permalink Reply by Diane Carter
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HI Matt
this is an expensive maze. We are a small tour operator and provide everything exc flights. So where can you go for the best bond as we cannot seem to get financial failure insurance? We have all other insurances in place. Average price of holiday is £500. Love some help as we already got conned with red tape issues
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Permalink Reply by Matt Zito on -
Steve, the Berkley Group offers Professional Liability protection for tour operators. The premium will be based on your revenue and the number of years you have been in business. I operated a a tour operator business in the USA for 16 years and carried a $1,000,000 Professional Liability policy with them. The policy also includes errors and omissions coverage. One thing to look at in any policy is to see if they have what they call "first dollar defense." If a person or company makes a claim against your company you want first dollar defense coverage, so that you can hire and attorney early and the insurance company pays the attorney fee. Most matters get settled quickly with the first 21-days of any type of customer complain or claim.
Best,
Matt Zito
Matt Zito is a veteran travel industry entrepreneur, consultant and founder of the world’s first ever, Travel Business Academy, a professional online program that teaches entrepreneurs globally, how to start and run a travel business. To learn more visit the Travel Business Academy or email matt@travelbusinessacademy.com
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Permalink Reply by Journey Israel LLC on
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Matt, I agree. Seems like the Berkley Group is the go to company, though I had trouble connecting with them directly. I was able to connect with a small agency in PA, the Perfetto Agency, and spoke with a woman named Amanda Bickelman. She was helpful and they simply connect with Berkley and procure the insurance through them. The policy recommended is through Zurich Insurance.
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Permalink Reply by Journey Israel LLC on
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Matt - wondering what your experience is with respect to someone just entering the field and the ability to obtain insurance coverage? In the process of trying to obtain insurance and was told that "lack of experience" in the industry may be an issue. Thoughts?
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Permalink Reply by Matt Zito on
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Hi, coverage approval will be based on the type of travel business you own/operate. It will be based upon risk assessment by the underwriter. Also of concern will be your revenue or gross sales. If your a legitimate company your firm will get insurance based on the above.
Matt Zito is a veteran travel industry entrepreneur, consultant and founder of the world’s first ever, Travel Business Academy, a professional online program that teaches entrepreneurs globally, how to start and run a travel business. To learn more visit the Travel Business Academy or email matt@travelbusinessacademy.com
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Permalink Reply by Matt Purser
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Hi Diane
Where did you try and obtain financial failure insurance?
Can I ask how many passengers you think you will carry?
Matt
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Permalink Reply by Diane Carter
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Hiya we just tried through an insurance broker who set up our tour operators insurance with a specialist company but he said he couldn't get us financial insurance. So he advised Serenity Trusts and they quoted £1,500 per year with £100 every time they released funds. Ok they said they would spread it over a year and then sent this actual proposal with an additional £1.5k plus. I asked what it mean and got nothing? This is what they sent....
Initial Set up Fee - £1,500.00 plus VAT. ok
Estimated annual transactional fees - £400.00 plus VAT in year one. –yes we are probably looking at approx. 6 -8 tours in next year – optimistically more
Reporting and Reconciliation Fees: (maximum) £1,560.00 plus VAT per year. –This I don’t understand as is this an additional fee as wasn’t mentioned
Bank and Online Banking Charges: £120 plus VAT per year.-that is fine
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Permalink Reply by Matt Purser
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Diane
We work with three different insurers who offer Financial Failure Insurance so please give me a call to see whether we can help.
Do you know which insurance company your broker approached?
Matt
020 8305 1233
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Permalink Reply by Diane Carter
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Hi ok where are you based please
I watched a TV show tonight something like watchdog and it gave lots of warnings about scam bookings so I can understand people's fears even though you would never consider it Thanks Ci
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Permalink Reply by Matt Purser
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Hi Diane
We are based in London.
Regards
Matt
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