Trip Mate Fails to Refund Premiums for Unused Insurance Coverage After Trip Cancellations, Class Action Claims

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A proposed class action alleges Trip Mate, Inc. and United States Fire Insurance Company have failed to issue refunds for portions of post-departure travel insurance coverage after a trip was canceled.

The 16-page lawsuit contends the defendants never assumed any risks for insured post-departure events—which can include trip interruption, medical or dental emergencies, or lost, stolen or damaged baggage—in cases where an insured trip was canceled. Despite their obligation to refund policyholders for premiums paid for unused post-departure coverage, the defendants have refused to do so, according to the suit.

Trip Mate administers single trip insurance plans on behalf of United States Fire Insurance Company and other insurers, the case says. These so-called “Travel Protection Plans” include coverage for events that occur either exclusively before or after travel begins, as specified in the plan documents, according to the suit.

Given that a policy’s schedule of benefits breaks down both the benefits for each travel protection plan purchased by the insured and the coverage limits of each corresponding benefit, the defendants can easily determine the pro rata share of the gross premiums that can be attributed to each policy benefit, the complaint argues.

Upon a trip’s cancellation prior to travel, however, the defendants, as a matter of policy, refuse to refund the pro-rated premium amounts paid exclusively for post-departure risks that were never assumed by or transferred to the companies, despite being obligated to do so, the lawsuit alleges.

“When an insured’s trip is cancelled prior to departure, Defendants are obligated to return the portion of the premium paid for coverage of risks that are only applicable post-departure,” the complaint argues. “This is because the portion of the gross premium paid in exchange for these exclusively post-departure benefits is unearned because Defendants were never at risk of having to cover the perils of actual travel.”

The plaintiff says he purchased a travel protection plan from Trip Mate to cover a CIE Tours International “Scottish & Irish Gold” land tour that was scheduled for May 2020. Per the case, part A of the plaintiff’s insurance plan included a “Cancel for Any Reason” waiver provided by CIE, while part B was to cover post-departure risks, including trip interruption; missed connection; travel delay; medical expense/emergency evacuation; non-medical emergency evacuation; accidental death and dismemberment; baggage and personal effects; and baggage delay coverage. As the lawsuit tells it, the coverages for these post-departure risks were not to take effect until the plaintiff’s departure, which never occurred.

According to the case, CIE canceled the plaintiff’s trip in March 2020 due to the coronavirus pandemic. The plaintiff says, however, that neither CIE nor the defendants ever refunded any premiums paid toward his travel protection plan.

The suit claims the defendants’ “systematic and uniform” practice of failing to refund premiums paid for post-departure benefits is “unconscionable, unjust, and unlawful.”

The lawsuit looks to cover the following proposed class:

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