Two proposed class action lawsuits were filed this week against JetBlue and Delta, respectively, over the airlines’ allegedly deceptive marketing of optional travel insurance policies.
According to the lawsuits, JetBlue and Delta aggressively push customers to add “travel protection” to online ticket purchases for an additional fee. What the airlines don’t say, the suits claim, is that they’re getting a cut of the profits despite not being licensed to sell insurance.
JetBlue and Delta’s “Deceptive Representations”
While customers are navigating through the defendants’ respective websites to buy plane tickets, they are stopped in their tracks by a page that presents them with an option to add travel insurance to their purchases, the suits explain. At this point, each traveler must choose whether they want to add this insurance before completing their purchase, according to the lawsuits.
The two cases, which are nearly identical, note that each airline marks the trip insurance option as “highly recommended,” assuring customers that “[p]eace of mind is only a click away” while providing them with a list of reasons to insure their trips. Though the lists are convincingly pro-consumer, the lawsuits argue that the airlines are really only concerned about their bottom lines, and not whether the consumer gets reimbursed for a last-minute cancellation. From the complaints:
This marketing is intended to create the impression that the trip insurance is in the consumer’s best interest—while hiding the fact that JetBlue [and Delta are] pushing the product because it is in [their] financial interest to generate sales. In other words, the consumer is deceived into believing that JetBlue [and Delta are] acting in the consumer’s best financial interest, and not [their] own.
JetBlue and Delta Take a Cut of the Profits, Lawsuits Claim
According to the lawsuits, the airlines attempt to appear neutral and distance themselves from third-party insurance providers, but in reality, are secretly commissioned by the companies to sell travel insurance policies.
The airlines’ websites supposedly note that the policies are “[r]ecommended by AGA Service Company, the licensed producer and administrator” of the plans, which are reportedly underwritten by Jefferson Insurance Company or BCS Insurance Company and are provided by Allianz Global Assistance. The cases argue that in the insurance world, the “producer” is known as the insurance agent or broker – or, in laymen’s terms, the one who gets paid to sell insurance. JetBlue and Delta represent that the extra insurance cost is merely a “pass-through charge” that the airlines simply forward to AGA without any profit on their part, according to the lawsuits.
In truth, the cases allege, JetBlue and Delta receive a “kickback” from the insurance providers for selling policies to travelers. This practice is illegal, according to the complaints, because the airlines aren’t providing the customers any services when selling them insurance policies on their websites and, on top of that, aren’t even licensed to sell insurance.
“JetBlue has never disclosed to Plaintiff, or any of the class members, the true nature of its relationship with Allianz, Jefferson Insurance Company, or BCS Insurance Company. Specifically, JetBlue has not disclosed the fact that it retains or receives a substantial kickback or commission on the policies made available on its website,” one complaint attests, with the other alleging the same regarding Delta.
The Proposed Class
The lawsuits are each attempting to cover a proposed class of individuals who purchased a trip insurance policy on JetBlue’s or Delta’s websites, respectively, “within the applicable limitations period.”