Claims for luggage soaring

Pack all valuables and a change of clothes in your hand luggage before you leave for a much-deserved holiday. Airports are a nightmare already without having to queue for ages to lodge a report for missing suitcases.

It is peak season in the travel industry and naturally some bags go missing. The Association of European Airlines (AEA) logged 19,200 delayed bags in June alone, up 43% from May.

However, the spike in lost baggage over the past year will not see a rise in travel premiums just yet.

While travel insurers Fortis and InsureandGo have experienced a rise in claims both agree that it is still premature to declare a rate hike.

Paul Chaplain, underwriting director at Fortis said that although more bags have been mislaid, they form a minority amount of overall travel claims. The bulk of claims are medical and cancellations.

In most instances the bags turn up after a couple of days and the resulting claim is for emergency - for clothing and toiletries – is inexpensive, amounting to an average of £200.

Meanwhile, InsureandGo reported an 85% increase in claims it received for lost baggage, receiving 1,133 claims from January 2006 to June 2006 compared to 2,094 in the same period in 2007.

InsureandGo managing director Perry Wilson said that claims for missing baggage amount to 20% of travel insurance claims.

He pointed to unscrupulous claimants jumping on the bandwagon to take advantage of the turmoil in airports at the moment.

The AEA consumer report published on Aug 1 revealed a 22% increase in the number of delayed baggage compared with the second quarter of 2006.

However, the AEA’s figures do not include budget airlines.

There may be some respite for insurers in the International Air Transport Association’s plan (IATA) to introduce a radio frequency identification (RFID) device to track baggage in major airports in the next five years. Heathrow will begin trials in September where selected check-in desks will tag bags with RFID chips.

It was reported that RFID could save airports and airlines £400m a year in reduced baggage losses and replacement of existing messaging systems.