Coronavirus: insurers halt travel cover

Coronavirus: insurers halt travel cover

Some of the UK’s leading insurance companies cut back on travel policies because of coronavirus

Brean Horne
Fri, 03/13/2020 – 13:23

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Insurance provider LV= has temporarily suspended the sale of travel insurance to new customers due to the spread of coronavirus.

It reported that the number of travel insurance polices sold had doubled over the last couple of weeks, as travellers rushed to get cover.

LV= decided to stop selling new policies instead of hiking prices.

Existing LV= customers will still be covered by the policies they purchased.

LV= says that it will continue to monitor the situation and review its decision on an ongoing basis.

Insurers; Churchill, Direct Line and Admiral have since suspended travel insurance sales to new customers as well. 

A spokesperson from LV= says: “In light of the significant impact that coronavirus is having globally, LV= General Insurance has taken the difficult decision to pause the sale of travel insurance to new customers.

“In the last couple of weeks, we’ve seen the number of policies sold double. 

“We considered a number of different options, such as excluding cover or significantly increasing prices for new customers but we strongly believe this temporary measure of pausing the sale of new policies and focusing on our existing customers is the right decision.

“There is no change for existing customers who already have a policy with us.

“They can contact us in the normal way if they need to make a claim, and we are also still offering renewals to our existing customers so they can continue to be insured with us. “

“LV= General Insurance remains committed to the travel insurance market and this is only a temporary move given the exceptional circumstances we find ourselves in.“

Insurers limit cover due to coronavirus

Insurance giant, Aviva, has cut back the cover available in new travel insurance policies to “reflect the current risks posed by coronavirus.”

New travel policies will no longer have the option to add travel disruption. Existing customers who have already purchased travel disruption and airspace closure add-ons will not be affected.

Aviva has also halted the sale of single-trip travel insurance to Italy. Customers who have already bought a policy will still have cover.

Axa has also decided to restrict travel cover for claims relating to coronavirus. Policies bought after 3pm on 13 March 2020 “will not cover any cancellation claim in relation to coronavirus” it said.

It follows, InsureandGo which announced earlier this week that customers who bought a policy from 11:59pm on 11 March will not be able to claim for disruption related to coronavirus.

Those who purchased policies prior to the 11 March will still be able to claim.  

A spokesperson from Aviva says: “Insurance is designed to provide cover for unforeseen and unexpected events and is priced on this basis. The outbreak of the Coronavirus means there is an increased likelihood of disruption to people’s travel plans.

We envisage that these decisions, affecting only Aviva’s travel insurance new business, will be temporary actions.”

How to find the right travel insurance

These simple steps can help you find the right insurance policy to cover your holiday.

1. Buy early

It’s important to buy your travel insurance as early as possible.

As well as covering issues while you’re away, travel insurance also covers any unexpected incidents before you go on your trip.

So, if you have to make any cancellations before going away, having a policy in place can help ensure you can recoup your costs. 

2. Shop around

Price comparison websites are a great place to start your travel insurance search.

They allow you compare hundreds of deals quickly and will give you an idea of the types of the deals available.

3. Read the terms and conditions carefully

Before buying an insurance policy it’s vital that you read the terms and conditions.

Insurance small print is notoriously tricky to understand so if you have any questions, get in touch with the provider for clarification.

Once you agree to the terms of a policy, making a claim will be impossible for things that are expressly excluded.

This could result in you having to pay more to cover the cost for any unforeseen incidents which aren’t covered, in addition to the policy itself.

 

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“I fell for diet scam but HSBC failed to stop my payments”

“I fell for diet scam but HSBC failed to stop my payments”

Moneywise columnist Hannah Nemeth helps a reader get a refund from HSBC after it failed to stop payments

Hannah Nemeth
Fri, 03/13/2020 – 12:14

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Diet scams have been around for years and, unfortunately, it is often the most vulnerable consumers who get taken in by promises of fast and easy weight loss. But, more often than not, the only pounds people lose are from their wallets.

Pensioner DB sent off for a free sample of slimming pills and paid £3.25 postage, using her HSBC credit card. The payment was taken in early September but – surprise, surprise – no free sample arrived.

Offering a free gift or trial while asking for postage costs is an easy way for fraudsters to get hold of victims’ card details – before targeting them for larger payments. 

On 25 September 2019, DB found that £89 had been taken from her account, so she immediately phoned HSBC. However, call-centre staff said the bank could not help as the sum taken was less than £100. Under Section 75 of the Consumer Credit Act 1974, consumers are only protected for purchases over £100.

And when DB went online to the bookmarked page to contact the diet company, it said ‘access denied’.

Another payment was taken in October, despite the fact that HSBC’s dispute team said it would block further payments. HSBC also cancelled DB’s credit card and issued her with a new one.

However, despite this seemingly belt-and-braces approach, another payment of £89 was taken in November 2019. DB says she then made nine phone calls to HSBC to stop the payment, but it still went through. She also did not receive the forms HSBC had promised her, which would enable her to raise a dispute over these transactions.

When she was eventually emailed the dispute forms, and she sent them back, she was told it was the wrong HSBC department and that she should try an online chat to discuss it.

DB says: “Each time I called, HSBC staff said they had no knowledge I had called about this issue before. I even sent a letter by special delivery to the only address given on the back of my bank statement, but it was returned unopened.

“I then sent a letter by recorded delivery to my local branch, but received no reply. When I went in in person, HSBC staff were very helpful but were unable to stop the payment – though they did try for two hours.”

By early December, DB had lost three payments of £89 each – a total of £267 – along with £3.25 postage, additional postage costs, and seven hours of holding on

to speak to HSBC over nine telephone calls.

DB eventually went into her local HSBC and cancelled her credit card. She also switched her current account from HSBC because she was “so disgusted with its attitude”.

When Moneywise contacted HSBC, it was quick to resolve the problem, offering to refund the three payments of £89 and to pay a goodwill gesture of £83 – coming to £350 in total.

A spokesperson for HSBC says: “We are sorry your reader had difficulty with a recent repeat payment. Due to an administrative error, the request to block those future payments was not actioned correctly. We have resolved the matter and have been in touch to apologise for this error.”

To add insult to injury, more than three weeks after she had received the £350, DB was bemused to get a letter from HSBC saying “it was looking into the payments taken from her account”.

DB told Moneywise: “Resolving the issue was down to you, and I want to thank you for your help. I was diagnosed with a blood clot in my leg and an irregular heart beat in November, so it’s been a distressing time.”

OUTCOME:

£267 refund plus £83

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Stephen Little: I think it’s time to stop scapegoating landlords

Stephen Little: I think it’s time to stop scapegoating landlords

Rocketing house prices and deposits over the past 20 years have priced many first-time buyers out of the market

Stephen Little
Fri, 03/13/2020 – 12:07

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Many commentators have blamed the buy-to-let market for pushing up prices and squeezing first-time buyers out.

In an attempt to rebalance the market, the Government has come down hard on landlords.

In 2016, the then Chancellor George Osborne introduced a raft of measures to curb the sector.

A 3% stamp duty surcharge was brought in on buy-to-let and second homes, making the cost of buying a property even more expensive.

Tax relief for landlords has also been gradually phased out since 2017. From April, landlords will no longer be able to deduct rental expenses from mortgage income and instead will be able to claim a 20% tax credit.

Charging letting fees has also been banned and landlords are only allowed to take five weeks’ rent as a deposit.

Buy-to-let has traditionally been seen as a good investment, with many landlords looking to invest in property to supplement their pensions.

However, government interference in the market is increasingly making buy-to-let less appealing.

Many landlords feel the Government has made them a scapegoat for the housing crisis in order to grab votes, and are now looking to get out.

The policies have had some success, with more first-time buyers getting on to the property ladder last year than at any time since the financial crisis, but at what cost?

While the Government has had the best of intentions, messing with the property market is having a huge impact on the rental market and ultimately, it will be tenants who suffer.

Landlords are seeing their profits fall and are already selling up, reducing the supply of rented properties. Increased costs for landlords are also being passed on to tenants.

More tenants are entering the market and, combined with the squeeze on supply, rents are being pushed higher.

Some of the landlords I have spoken to feel disillusioned with the Government and don’t feel the extra income is worth the hassle any more.

According to research from Rightmove released last year, almost a quarter of landlords are planning to sell.

While landlords leaving the market will help to free up supply for first-time buyers, it could prove to be disastrous for tenants. Demand from tenants is increasing and reductions in supply could result in rents being pushed up  further.

A recent report by ARLA Propertymark also found that 230,000 landlords are considering switching to short-term lets as they offer bigger profits, which could exacerbate the problem.

Things are likely to get worse for landlords before they get better. With the Budget nearly upon us, landlords are unlikely to get much help from the new Chancellor.

There are also plans for Section 21 ‘no fault’ evictions to be scrapped, making it more difficult to evict tenants at short notice. There are fears that this could disincentivise investment and lead to a landlord exodus.

The National Landlords Association (NLA) warns that if Section 21 is abolished there could be 960,000 fewer homes available to renters if landlords pull out of the market.

While the Government has opened up housing for some renters who were competing with buy-to-let, getting on the property ladder is nothing more than a pipe dream for many.

Government policies that cut the rental supply are only going to drive rents up and do little in the long term to get more first-time buyers on the property ladder.

Most landlords are ordinary, hardworking people who want to do the best for their tenants, with a small minority of rogue landlords giving the sector a bad name.

Demonising them helps no one and the Government has to realise the valuable contribution they make to society by providing rented accommodation.

Housebuilding rates continue to fail to meet Government targets of 200,000 a year, and this is where the real problem lies.

Rising homelessness and sky-high house prices highlight the need for more social housing, while  the number of tenants stuck in the rental sector suggests the system is broken.

The vast difference in property values across the country is also another problem that needs to be tackled.

If the Government wants to fix the housing crisis it needs to address the imbalance of supply and demand by building more starter homes.

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Budget 2020: £100 tax cut for 31m workers as Chancellor cuts National Insurance and boosts national living wage

Budget 2020: £100 tax cut for 31m workers as Chancellor cuts National Insurance and boosts national living wage

The Government plans to increase the national living wage (NLW) to reach two-thirds of median earnings by 2024

Faith Glasgow
Wed, 03/11/2020 – 16:07

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As part of a big push to deliver prosperity in today’s Budget, chancellor Rishi Sunak has announced plans to increase the national living wage (NLW) to reach two-thirds of median earnings by 2024. This means it should stand at more than £10.50 an hour by that tax year.

The wage floor currently stands at £8.21 and is already due to rise by 6.2% to £8.72 in April, giving the average low-paid worker almost £1,000 extra per year. Today’s measures will amount to an increase of around 20% from the April level, though they include the caveat the increase will take place “provided economic conditions allow”.

Low earners will also feel particular benefit from the new tax year with the further announcement that the national insurance threshold will be raised to £9,500 for employees and the self employed.

The Government calculates that the typical employee should be around £104 better off and the typical self-employed will gain £78 in the coming tax year.

For low earners who also benefit from the rising NLW and bearing in mind increases in the personal allowance (currently £12,500, rising in line with the consumer price index from the 2021/22 tax year), the changes mean that from April a full-time employee earning the NLW will be more than £5,200 a year better off, compared with April 2010.

There could be a further benefit in the pipeline for low-paid workers as far as pension provision is concerned. At present, around 1.7 million workers earning less than the £12,500 annual personal allowance (and therefore paying no tax) receive no tax relief on any pension savings because of the way tax relief is administered by their pension scheme.

The Government says that people in this position “may benefit from a top-up on their pension savings equivalent to the basic rate of tax, even if they pay no tax”, but that whether they receive this top-up or not currently “depends on how their pension scheme administers tax relief”.

The Budget commits the Government to “reviewing options for addressing these differences” and says it plans shortly to “publish a call for evidence on pensions tax relief administration.”

Steve Webb, a partner at LCP, sees the announcement as a missed, or at least delayed opportunity. He says: “This injustice, which affects many lower paid workers in particular, must be addressed.  Instead, all we have from the Treasury is the promise of a ‘call for evidence’. If a review means no action for another year, this will prolong the unfairness to a group who need all the help they can get with their pensions”.

This story was first published in our sister publication Money Observer.

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