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Florida Cruise Consumers - Out Of Trip, Out Of Insurance, Out of Luck

Posted by Jane Akre
Thursday, January 07, 2010 12:10 AM EST
Category: On The Road
Tags: Cruise Industry, Cruise Liners, Carnival, Holland America, Cruise Insurance, Trip Insurance, Florida Department of Financial Services

Passengers across the country looking forward to a cruise they had to cancel, found they were also out thousands when trip insurance failed to pay.

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IMAGE SOURCE: Wikimedia Commons/ Carnival liberty/ Fort Lauderdale/ author: Captain-tucker

Cruise To Nowhere

They were travelers from around the country looking forward to their cruises that took off from Florida ports.

But when hundreds of would-be travelers had to cancel their cruises, usually because of illness, they rest assured they'd be able to be reimbursed by the trip insurance they purchased for such events. Or not.

Health News Florida reports about 300 who had to cancel their trips, never received a dime of trip cancellation insurance.

The company that was supposed to protect their investment, Prime Travel Protection Services of Arvada, CO declared bankruptcy a year ago. Colorado authorities issued a cease-and-desist order against the owners.

Now an investigation into the incident says that travel agents in Florida should never have arranged the coverage because the company wasn’t licensed to do business in Florida. The losses could run into the millions, considering the price of an average cruise runs at least $4,000.

But unless the travel agents knew the Colorado company was not licensed, the state will have a difficult time proving there was any crime.

Losses In The Millions

The Department of Financial Services (DFS) has released a number of complaints and some documents clearly showing the extent of the losses, among them:

· One woman from St. Augustine lost $6,700 on a cruise through the Baltics with her husband when she found she needed immediate surgery for a blocked carotid artery.

· Another man, a retiree living near Tampa, says he lost $61,000 when he had a heart attack on a cruise.

· A couple from Boca Raton say they lost $41,000 when they had to cancel their four-week cruise from Singapore to Rome after finding out the wife needed tests for what appeared to be a recurrence of cancer.

The DFS Division of Insurance Fraud is looking at several companies that sold insurance to consumers and a few travel agencies that did business with Prime Travel Protection have been ordered to reimburse a handful of consumers.

Trip Assured, a Tennessee travel-insurance company was shut down by authorities in 2006 for not paying claims. That agent then went to Prime Travel Protection Services of Arvada, which is the company that declared bankruptcy.

Orange County, California college professor Barry Resnick tells Health News Florida that it took too long for the state to connect the dots. He accused Florida officials of "gross incompetence" for failing to notice that the owner of Prime Travel was previously involved with another insurer that Florida ordered shut down in 2006. The Web site was unsuccessful in contacting any of the travel insurers involved.

The DFS is looking at three other travel agencies, Vacation Superstore Network (aka Best Price Cruises); SmartCruiser.com; and Super Travel of West Palm Beach. #


6 Comments

Anonymous User
Posted by Steve Lombardi
Thursday, January 07, 2010 10:34 AM EST

Interesting story Jane. What would interest me about this story is knowing the number of travelers who vote for tort reform and who complain about lawyers in general, but will now run to ... you guessed it... a lawyer! Travelers, like many other consumers, should know that the American Tort Reform Association and the U.S. Chamber of Commerce will not spend one minute or say one word against business practices that rip off consumers; but each of those organizations will spend millions bashing lawyers and those that file lawsuits. Every wonder where these organizations get their funding?

It's a curious thing to me that bashing lawyers who assist consumers with fraudulent business practices seems to sell to well. Here is a news-atainment TV network that knows it sells so they keep bashing. Consumers in supporting these people are simply loading a handgun, pointing it at their foot and pulling the trigger. They can have tort reform so long as the consumer and businesses don't mind getting ripped off and having their 401K plans emptied by Wall Street. Vote your conscience and your wallet.

Even those who buy into Hannity's verbiage will run to a lawyer when wronged. Heck, I'm sure even Hannity hires lawyers.

LINK

Posted by Jane Akre
Thursday, January 07, 2010 11:50 AM EST

Steve-

Not to mention that little thing called the Seventh Amendment to the U.S. Constitution, part of the Bill of Rights, which ensures the right to a jury trial. It's our way of life that we fight wars over and enjoy but like sheep led to slaughter, we are unaware of what makes us great. If we don't understand it, we will lose it.

The Center for Media & Democracy is a nonprofit that began years ago ferreting out the subtle forms of propoganda including Tort Reform that began with Big Tobacco, Asbestos, Pharma etc. Check Sourcewatch. They are worthy of support.

Anonymous User
Posted by Barry Resnick
Thursday, January 07, 2010 10:50 PM EST

Jane-
Let me clear up a few inconsistencies in your story. The owner of Prime Travel Protection (PTP), Jerry A. Watson was a vice-president of Trip Assured. In January 2004 he left to form a company named Vacation Protection Services (VPS) -an unauthorized seller of travel protection. Mr. Watson later operated another unauthorized company, Traveler Protection Services. Months after Trip Assured was issed a cease and desist order in September 2006, the same travel agencies who sold through Trip Assured began selling for one of Mr. Watson's illegal companies. The culprit is not only Mr. Watson, but the serial sellers of these illegal products - the travel agencies and of course, the state of Florida who refused to take any action. Media reports have pointed to Florida travel agencies, High Performance Travel, Best Price Cruises, Legendary Journeys and Smartcruiser - all these agencies not only sold through Trip Assured, but the subsequent unauthorized companies.

Posted by Jane Akre
Thursday, January 07, 2010 11:56 PM EST

It certainly is a tangled web with the end result apparently that these consumers are out thousands! Thanks for commenting.

Anonymous User
Posted by Harry Baxter
Friday, January 08, 2010 8:48 AM EST

One has to question whether the State of Florida is serious about "wanting to prove criminal intent". This scam has been active for at least five years. It has involved the same cast of scam artists who marketed the same scam product under different names, and the same greedy travel agents who, driven by their own greed, sold the useless product for 40% commissions to their unwary customers. One of these agents has sold over 15,000 policies. I was an unwary customer back in 2006, and when the fraud occurred, I contacted everyone, not only in the Financial sections of the States of Florida and Tennessee, where Trip Assured was located, but individuals at the highest executive levels of State Government, including Charlie Crist, the current Governor of Florida, who was then Attorney General, and Phil Bredesen, the Governor of Tennessee. As far as I know, my complaint is still on file, at the bottom of a stack of complaints that must be several feet high by now. Back in 2006, before Trip Assured was shut down, The Nashville Tennessean published pictures of McKinley Johnson, the President of Trip Assured, partying with the President and Vice President of the United States, so it's no mystery about why average consumers don't stand a chance.

Anonymous User
Posted by Peter
Friday, January 08, 2010 11:49 AM EST

Thank you for picking up this story of a $25,000,000 travel insurance scam. I am a spokesperson for 70 victims of the 300 official complaints. We have been named the “Group” by travel agents who partnered in the scam and have been working together since August 2008.
Your story, which is very welcomed, leaves the impression that the Florida authorities can’t do anything. This is not true. The criminal investigation was completed well before new documentation was available. I am taking steps to have this reopened. There are three other serious investigations still ongoing against the serial offending travel agents in Florida. The Department of Financial Services and their Division of Insurance Fraud are the most actively involved; they have the power to take civil action or penalize travel agents severely. The Office of Insurance Regulation is investigating Jerry Watson and his previous companies. The Attorney Generals Department have collected data and are awaiting the go ahead from DFS. The Department of Agriculture and Consumer Services have done an appalling job.
You mention an unlicensed insurance product but you miss the most important element. Jerry Watson set up a fraudulent insurance policy (see Colorado’s C&D) and the travel agents eagerly participated because of sign on bonuses and 40% commissions.
Premier league serial offenders since 2004 are: Smartcruiser.com, Boca Raton; Legendary Journeys, Sarasota; Best Price Cruises, Port St. Lucie. Trip Assured had 678 travel agent clients in 2005 – 158 in Florida.
Four private law suits have been filed.

Comments for this article are closed.

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