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Eight weeks ago, Thomas Cook, the second largest travel company in Europe, went bankrupt. 660,000 customers were stuck directly. More hundreds of thousands had to give up their already booked trips. The tourists are now sitting on a damage of several hundred million euros - in Germany alone. And, as it stands, much of this damage is not reimbursed. That does not mean that vacationers have to put up with it.
In the bankruptcies of Air Berlin and Germania, it worked well when tourists who had paid by credit card, triggered a so-called chargeback procedure. At least if the customers persisted. For a package holiday that should not be necessary: After all, all customers are insured against bankruptcy. Usually at least.
The so-called travel insurance certificate was introduced after some spectacular bankruptcies at the end of the last millennium. It not only financially secure, but also to guarantee that the travelers come back safely in a bankruptcy.
In 2015, the EU had once again modernized the corresponding directive. In 2017, this implemented the Grand Coalition into German law.
But in the case of Thomas Cook, this guideline is inadequate.
The vast majority of Thomas Cook travelers had booked with the Group companies Air Marin, Neckermann, Öger Tours or Bucher Reisen. At the variety of brands one can already guess that this is a major player in the tourism industry.
Thomas Cook was obviously larger than the imagination of the legislature: Only 110 million euros for damage within a year is the statutory sum insured. After the Thomas Cook bankruptcy, it quickly became clear that that would not be enough. And oh, miracle, the insurer Zurich, who issued the security certificates for Thomas Cook, guarantees exactly just for this sum.
Of the 110 million already went from a lot: the retrieval of over 100,000 Cook customers directly after the bankruptcy already cost around 60 million euros. In addition, from the point of view of the insurer, the bankruptcy of a small competitor with costs of 7 million euros is to be paid out of the 110 million pot.
Zurich is writing to me this week that 150,000 customers have already registered by November 1, claiming more than € 250 million in damages. Surprisingly, Zurich plans to offer customers less than 20 percent compensation at the beginning of December. In other words, anyone who has booked and paid a package holiday for his family for 5,000 euros only gets back about 1,000 euros.
The blame for this financial disaster is spread over three parties:
- Once upon a time there is the insolvent Thomas Cook : As an industry giant, it should have bought protection from several insurers.
- Then there would be the insurance company Zurich , which is contractually obliged only to pay 110 million euros, but has already planned a large part of the money.
- But even the federal government has its share: After all, she has overslept to prescribe a reasonable hedge for the travel giant. In Austria, insurer coverage would have amounted to at least € 380 million (ten per cent of the annual turnover of insured travel companies), and in many other EU countries a reduction in compensation is not envisaged.
It takes little imagination to suspect that the three protagonists will now deliver a long banter, in the end, the customers are the stupid.
It would not have to be that way. Because all parties have opportunities to improve the situation for the customers:
- The insolvency administrator of Thomas Cook should know exactly who has already paid travel to the group's daughters - and how much money is involved. The insolvency administrators of the subsidiaries could simply provide a list of travelers as creditors, no one would have to register, nobody would be forgotten. However, the insolvency administrators Hermann, Wienberg and Wilhelm did not yet provide such a list. Your press agency could not even cite the total number of potential customer creditors. In December, the travelers should be contacted.
- The Federal Government repeatedly declares publicly that the insurer would have to pay the 110 million euros insured sum for the damages of the customers in addition to the retrieval. So far, however, the government has not persuaded the company Zurich to join the state legal concept. The question arises as to whether the government would not have to force Zurich to write an invoice to the 140,000 holidaymakers and one in return for equal treatment of all those injured To credit part of the return costs to the other holidaymakers. Then all the victims would get replaced 30 percent each of their damage. For Zurich, however, that would be a public relations disaster.
This whole mess was foreseeable: Thomas Cook Group, insurer and the state have accepted such a disaster approvingly. Since 2001, travel professionals have warned that the 110 million rules were inappropriate given the fast-growing travel market. In 2017, barely the insight that the Thomas Cook Group was now a wobbly giant.
What customers can do
If you, as a customer, do not want to wait for this never-ending story and have paid for your trip by credit card or Paypal, you have another option. You can initiate the chargeback process or use Paypal Buyer Protection. That worked well with the bankruptcies of Airberlin and Germania.
In the case of a chargeback, your own bank will arrange for a remittance if the service has not been provided by the settling company. That should undoubtedly be the case.
More on the subject:
The rules of Mastercard and Visa also provide for this chargeback if the insurer of a tour operator can not or will not. Then either the residual damage or the complete sum is returned to the customer. It still remains to be seen how the banks will implement this exactly. Because the case of Thomas Cook is also a new experience for her. Before a chargeback must be clear in any case, how much Zurich now pays exactly.
For the chargeback process, banks keep forms available, either online or at the store. In addition, you still need the accounting documents and the letter from the insurer that he does not pay for the entire cost. But be persistent. Because probably many unsuspecting or only comfortable bank employees will explain that in this case no chargeback is possible.
Creditors of Thomas Cook would then be the companies that are used in the chargeback of the credit card companies. They can then pressure the insolvency administrators - and maybe the federal government too.
And customers would exceptionally get rid of the problem.
