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Law360, London (March 12, 2020, 12:28 PM GMT ) British insurers have begun scaling back the scope of travel insurance, or have stopped selling policies outright, as the global spread of the coronavirus disrupts business and holiday travel.
U.K. insurers Admiral, Aviva and LV= have kicked off an industry trend of scaling back their travel coverage as airlines around the world canceled flights wholesale in response to a sharp drop in bookings.
"In light of the impact that coronavirus is having globally, we've made the difficult decision to pause the sale of travel insurance to new customers," LV= said in a statement late Wednesday.
Admiral followed suit on Thursday, saying it had also decided to temporarily stop selling new travel insurance policies.
The World Health Organization on Wednesday announced the virus was now a pandemic, meaning it was spreading in multiple countries at the same time.
Shortly afterward, U.S. President Donald Trump declared a 30-day ban on flights from continental Europe to contain the spread of the virus.
Aviva said it would continue selling cover, but had stopped offering optional travel disruption and airspace closure protection with the new policies it sold. In addition, the company reaffirmed that it would not pay out if the U.K. government advised against non-essential travel.
"Our travel insurance will not cover you if you need to cancel or abandon your travel plans if the Foreign & Commonwealth Office advises you not to travel, for example where the FCO advise against all but essential travel to an area affected by coronavirus," a statement by the company said.
Specialist travel broker Sportscover Direct said on its website on Wednesday it had introduced a "coronavirus exclusion" to new policies sold from Monday morning onwards, "which excludes any claim caused by coronavirus."
Mapfre-owned insurance company Insure & Go said it would not pay any claims related to coronavirus on travel insurance policies bought after 11.59pm on March 11.
U.K. insurance price comparison site Go Compare reported that travel insurance sales have risen by 170% but urged customers to check their policies for exclusions.
"Anyone who has bought insurance after coronavirus was a known issue in the destination they're travelling to is unlikely to be covered," said Sally Jaques, travel insurance expert at the company.
U.K. insurer Direct Line said last week it has so far received around £1 million ($1.26 million) in travel insurance claims since the outbreak began.
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