Small Fish Big Ocean

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

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Replies to This Discussion

Permalink Reply by Steve G on February 2, 2012 at 17:28

Just to add, that I am very much lost in all the information I am reading!!!

 

Thank you so much in anticipatiom!

 

Steve Garnett

Permalink Reply by Matt Purser on February 3, 2012 at 10:21
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
Permalink Reply by Diane Carter on July 21, 2014 at 18:29

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

Permalink Reply by Matt Zito on February 4, 2012 at 19:30

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

Permalink Reply by Journey Israel LLC on February 5, 2012 at 0:07

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.  

Permalink Reply by Journey Israel LLC on February 7, 2012 at 21:56

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? 

Permalink Reply by Matt Zito on February 7, 2012 at 23:45

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

Permalink Reply by Matt Purser on July 21, 2014 at 18:35
Hi Diane

Where did you try and obtain financial failure insurance?

Can I ask how many passengers you think you will carry?

Matt
Permalink Reply by Diane Carter on July 21, 2014 at 23:02

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

Permalink Reply by Matt Purser on July 22, 2014 at 8:29

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

Permalink Reply by Diane Carter on July 22, 2014 at 22:27

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

Permalink Reply by Matt Purser on July 23, 2014 at 9:11
Hi Diane

We are based in London.

Regards

Matt

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