Insurance of civil liability of tour operators - Insurance underwriting

Insurance of civil liability of tourist operators

This type of insurance is mandatory under the Federal Law of 24.11.1996 № 132-Φ3 "On the basics of tourist activities in the United States" (as amended on 03.05.2012 No. 47-FZ), which provides for the availability of financial security in the form of liability insurance of a tour operator or a bank guarantee for an amount not less than:

• 500 thousand rubles. - for tour operators operating in the field of domestic tourism;

• 30 million rubles. - for tour operators with the amount of money received from sale in the field of outbound tourism, no more than 250 million rubles. per year;

• 12% of the amount of money received from sale in the field of outbound tourism, more than 250 million rubles. per year.

Insurance object - the property interests of the tour operator, associated with the risk of the obligation to compensate tourists and (or) other customers for real damage that arose as a result of the tour operator's failure to fulfill or improper performance of obligations under the contract for the sale of the tourist product.

The insurer is obliged to pay the insurance indemnity at the written request of the tourist (other customer) upon the occurrence of the insured event - the fact of establishing a material breach of the terms of the agreement on the sale of the tourist product:

1) non-fulfillment of obligations to provide transportation services to a tourist (other customer) of transportation and accommodation services;

2) the presence in the tourism product of significant deficiencies, including significant violations of the requirements for the quality and safety of the tourist product.

The expenses incurred by the tourist and not conditioned by the requirements for the quality of the tourist product, usually required for a tourist product of this kind, are not subject to reimbursement by the insurer. The insurer shall be exempt from payment of the insurance compensation for compensation of loss of profit and compensation for moral damage.

The insurer is not released from the payment of compensation if the insured event occurred as a result of the intent of the tour operator. The deductible in this type of insurance is not applied.

"Typical rules of insurance of civil liability of tour operators for non-fulfillment or improper performance of obligations under the contract", approved by the Federal Service for Insurance Supervision, offer the following insurance rates:

• international and domestic tourism - 2.4025% of the insured amount

• domestic tourism - 2,053% of the sum insured.

The insurer has the right to apply to base rates

increasing (from 1.0 to 5.0) or decreasing (from 0.4 to 1.0) coefficients, based on the timing of the implementation of tour operator activities and its volumes, directions (countries) with which the tour operator operates, availability in past periods of claims of tourists (other customers) and other factors.

Since the beginning of compulsory insurance of liability of tour operators, the cases of their bankruptcy have become more frequent, and the overwhelming majority of insurance cases arose due to the risky financial policies of insured tour operators or (but it was not proved in court) as a result of financial fraud.

Therefore, the main underwriting tool in the insurance of liability of tour operators is individual financial underwriting, which includes mandatory examination by experts of the financial statements of the tour operator, loans received, the structure of costs and incomes, etc., as well as the study of insurance history and complaints of tourists to fulfill the conditions of tourist contracts without claims of an insured event.

Until now, the level of payments for this type of insurance is low, so insurers in pursuit of insurers mainly use a decreasing factor when concluding insurance contracts, and the role of underwriting is reduced to cutting off unscrupulous or in difficult financial situation tour operators.

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