RBS forced to backtrack on T5 travel insurance cover

Mon, 21 Apr 2008

Insurers in the Royal Bank of Scotland group have been forced into a humiliating U-turn from their refusal to cover passengers at Heathrow’s Terminal 5 after RBS failed to convince rival insurers to follow suit.

The group, which includes Direct Line, Churchill and Tesco, withdrew cover for T5 passengers for claims such as lost baggage and delays. In it’s opening week, the terminal became notorious for lost baggage and cancelled flights .

The ban from RBS only applied to those who had purchased policies since T5 opened. RBS justified its actions saying that insurance doesn’t apply if policyholders knowingly put themselves at risk.

"We can only pay out for events the customer is unaware of at the time of purchase, not for those that have happened. We don't cover medical conditions existing when the policy is taken out, for example," it says.

However, faced with no support from competitors and terrible publicity, the RBS insurance group had little option but to backtrack.
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