Italy has fined Ryanair and easyJet a total of more than €1m for mis-selling travel insurance on their websites.
The Italian competition watchdog said that they had infringed its consumer code by withholding information and misleading customers, as well as charging them excessive fees, and putting obstacles in their way when trying to make a claim.
Ryanair was fined €850,000 and given 30 days to say how it will change its “unfair commercial practices”.
EasyJet was handed a €200,000 fine, much lower because in the view of the regulator it had already made the necessary changes to its booking process. A spokesperson expressed disappointment in light of the fact that it had already remedied the issues raised.
The regulator criticised Ryanair's "unfair, cumbersome and misleading" practice in selling its insurance. Anyone who did not want it, have to find the “No, Grazie” button neatly tucked away between Malta and Norway in a drop-down list of countries of residence.
In considering claims, both airlines obliged claimants to call a premium-rate phone number and pay for a certificate proving that they had not travelled, costing €20 from Ryanair or €12 from easyJet.
The regulator said this was "information which the companies already have and could be easily given to the insurance company without any burden to consumers". It deemed the fees, phone call costs and high excesses in policies were all deterrents to making a claim. Together these costs could be more than the insurance itself.
Last year, Ryanair made over €1bn, 22% of its overall revenues, on selling additional services, such as insurance. EasyJet, however, said that insurance sales were continuing to fall and it brought in just €64m from additional services sold.
Ryanair said it is to appeal while easyJet said it is considering its options.
Comments
As for putting obstacles in the way of people making claims, isn't that what all insurance companies do and what we have come to expect?
The only result of this will be increased prices for flights.