Two of the largest airlines in the United States are now each facing similar class action suits.
JetBlue and Delta are each facing class action lawsuits accusing them of taking travel insurance kickbacks for selling policies. They are accused of failing to tell customers that they receive payments when they sell travel cancellation insurance policies.
The travel insurance is advertised on the websites without mention that the carriers are paid to sell.
The two lawsuits over the travel insurance kickbacks are nearly identical. They were both filed in September by the Leon Cosgrove law firm in Florida. According to the suits, JetBlue and Delta are leaving travelers “with the false impression that the charge for trip insurance is a pass-through” charge from another entity with which they are not financially connected. Instead, the lawsuits accuse the airlines of receiving kickbacks for the sale of the policies online.
“Consumers are required to make an insurance election, as they are unable to proceed with purchasing their airline tickets on [Delta and] JetBlue’s website[s] until they choose whether to purchase a trip insurance policy,” says the suit against JetBlue. “The consumer cannot simply ignore the insurance offering and move on to purchasing a ticket.”
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The accusation of travel insurance kickbacks suggests the airlines are deceiving their customers.
Both airlines have mentioned on their websites that the travel insurance policies are sold through AGA Service Co. That company both produces the plans and administers them. That said, the policies are underwritten by either BCS Insurance Co. Or Jefferson Insurance Co. They are provided by Allianz Global Assistance.
The airline websites use brightly colored features to underscore their recommendation that their customers purchase a travel insurance plan.
“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,” said the JetBlue lawsuit, as reported by CBS news. “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.”