Automatically Charging Consumers For Ancillary Travel Insurance Without Consumers’ Informed Consent Prohibited

INFORMATIONAL MEMORANDUM OIR-15-01M ISSUED February 3, 2015 Florida Office of Insurance Regulation Kevin M. McCarty, Commissioner AUTOMATICALLY CHARGING CONSUMERS FOR ANCILLARY TRAVEL INSURANCE WITHOUT CONSUMERS’ INFORMED CONSENT PROHIBITED The purpose of this memorandum is to remind insurers in Florida of the Unfair Insurance Trade Practices Act and its prohibition against unfair methods of competition and unfair or deceptive acts or practices pursuant to section 626.9541(z), Florida Statutes (2014). The Florida Office of Insurance Regulation (“Office”) is reminding insurers of the Florida Unfair Insurance Trade Practices Act (“Act”) and its requirement that insurers refrain from engaging in practices that constitute unfair methods of competition or unfair or deceptive acts or practices, including the act of “sliding.” The Office has been made aware that some insurers, offering travel insurance through retail travel agencies in conjunction with travel purchases made via websites, require consumers to opt out of purchasing ancillary travel insurance by deselecting a radio button or check box. If a consumer does not deselect the insurance offering on the website, the cost of the coverage is automatically added to the consumer’s total purchase. “Sliding” is defined in the Act as “charging an applicant for a specific coverage or product, in addition to the cost of the insurance coverage applied for, without the informed consent of the applicant.” The practice of automatically charging consumers for ancillary travel insurance unless consumers take action to decline coverage does not comply with the requirement of “informed consent.” Consumers must be given the opportunity to affirmatively accept travel insurance or any other insurance coverage. Insurers are liable for the actions of agents and others selling their products that engage in sliding, or otherwise fail to comply with the Unfair Insurance Trade Practices Act nsumers take action to decline coverage does not comply with the requirement of “informed consent.” Consumers must be given the opportunity to affirmatively accept travel insurance or any other insurance coverage. Insurers are liable for the actions of agents and others selling their products that engage in sliding, or otherwise fail to comply with the Unfair Insurance Trade Practices Act. Should you have any questions regarding the contents of this memorandum, please contact Rachicʹ A. Wilson, Assistant General Counsel, Florida Office of Insurance Regulation, at Rachic.Wilson@floir.com or 850.413.4121.