Insurers may be told to pay travel claims caused by delayed passports

The Financial Ombudsman Service (FOS) may ask insurers to pay the claim for a cancelled holiday caused by delays in passports being processed.

But the ABI has said that “policies are not designed to cover cancellation due to delays in obtaining a passport”, while Biba also said it would not expect insurers to cover this situation.

Up to 30,000 passport applications have reportedly been hit by delays. The government’s decision to shut down seven overseas passport offices has been identified as a key reason in the delays, which has meant that since January British passport offices have dealt with an extra 350,000 applications for travel documents.

The Financial Ombudsman Service (FOS) said that it may ask an insurer to pay the claim for a cancelled holiday as long as the policyholder had “done all they reasonably could to chase the passport application” and had “put in their passport application in far in advance of the deadlines laid down by the passport office”, The Guardian reported.

A spokeswoman for the FOS said: “If they (the holidaymaker) were still unable to travel due to the delays, then we would be looking for the insurer to act in the spirit of the insurance policy.”

“As ever with these things, just because the insurer may give you a reason it doesn’t necessarily mean that it’s fair,” she said. “[The current delays in processing passport applications] is a situation so far out of a holidaymaker’s control that we would expect insurers to take a more holistic view when considering claims.”

The Ombudsman Service added, that, as an indication, if the deadline was four weeks and somebody had applied for their passport seven to eight weeks in advance, it may expect insurers to pay out.