Are travel agents liable for selling bogus travel “insurance” policies?

Virginia Hamlin is upset.

A year ago she booked a Panama Canal cruise through Legendary Journeys, a travel agency based in Sarasota, Fla. At the time she was offered a $177 “travel insurance” policy through Travel Protection Services.

Last week, Legendary sent her a registered letter with some bad news:

Our travel insurance company, Travel Protection Services, Inc., had filed for bankruptcy. There was no recourse for us except to buy new insurance with a company, Travelex.

They offered to give us a $200 credit on our next trip to make up for the inconvenience. At this point we have completely paid for the trip, and if I read the instructions correctly, the most we could expect to get back is 50 percent of our payment, or less.

This has opened up all kinds of questions for me. There doesn’t seem to be any recourse.

Actually this has opened up all kinds of questions for a lot of folks.

You can read all about Travel Protection Services and Legendary Journeys here, along with this follow-up post, which is now the most-commented story on my blog.

Curiously, I’ve already received two letters from attorneys about the comments on the latter posting, which I find a little disappointing. I’m used to them coming after me, not the commenters whose opinions are completely protected under the Communications Decency Act.

A review of the 100+ comments, and Hamlin’s case, leads me to believe there’s one big question that’s begging to be asked: Are travel agents who sold travel “insurance” that wasn’t insurance liable in any way?

Related story:   Florida accuses three more travel agencies -- wait, make that five more agencies -- of selling unlicensed insurance

There are two answers. If customers were advised that this wasn’t insurance, and that it might not cover them the same way traditional travel insurance would, and they still signed up for it, then I think agents are off the hook.

But if agents presented this as insurance, sold it as such, and left their customers with the impression that they were covered as if they had insurance, then their customers have every right to be angry.

“I think Legendary is guilty in this situation because they should have checked better on the company they associated with,” Hamlin told me.

Legendary would not respond to my requests for a comment the last time I wrote about it, but a representative found the time in early December to post the following comment on my blog:

Legendary Journeys discontinued selling this insurance product when all of this came to our attention. We now sell Travelex, licensed to sell insurance in all 50 states.

I share some of the skepticism in the comments made by Hamlin and others. I find it difficult to believe travel agencies were completely unaware of the problems with Travel Protection Services.

But I don’t know that for a fact. Maybe that’s something for a judge to decide.

Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or check out his adventures on his family adventure travel site. Contact him at Read more of Christopher's articles here.

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