US airlines face lawsuits over add-ons

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Travel insurance

Two US airlines are facing possible class action lawsuits over what is alleged as the deceptive marketing practices they use to sell optional add-on travel insurance policies. The airlines, Delta and JetBlue, are also accused of receiving ‘kickbacks’, as they supposedly receive a share of the profits from the sales of these policies despite the fact that they are not licensed to sell insurance.

The lawsuits were both filed by Florida-based law firm Leon Cosgrove and are almost identical; they allege that the airlines give customers ‘the false impression that the charge for trip insurance is a pass-through’ fee from a separate company, making the transaction one in which the airlines have no financial interest.

“Consumers are required to make an insurance selection,” the lawsuit against JetBlue states, “as they are unable to proceed with purchasing their airline tickets on [the airline’s] website until they choose whether to purchase a trip insurance policy. The consumer cannot simply ignore the insurance offering and move on to purchasing a ticket.” The bright, attractive marketing, according to the lawsuit, ‘is intended to create the impression that the trip insurance is in the consumer’s best interest – while hiding the fact that [the airlines are] pushing the product because it is in [their] financial interest to generate sales’.

The travel insurance for both airlines is provided by Allianz Global Assistance; Allianz and JetBlue have declined to comment on the allegations, although Delta has called them ‘false’ and assert that they ‘have no basis in fact or reality’.