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[March 18, 2014]
Italy slaps fines on airlines over travel insurance
(City A.M. (UK) Via Acquire Media NewsEdge) RYANAIR and EasyJet have been fined more than €1m for not being clear enough about the travel insurance they sell to Italian customers alongside flight bookings.
Italy's competition authority has imposed an €850,000 (£697,000) penalty on Ryanair and a €200,000 fine for EasyJet for "unfair commercial practices".
The low-cost airlines failed to tell customers about the risks covered by the insurance policies and set excesses so high that they were sometimes more than the original cost of the ticket, the Autorita Garante della Concorrenza e del Mercato added.
Passengers who fail to board their flight have to get proof from the airline in order to claim on cancellation insurance. Ryanair charged customers €20 to obtain a certificate and EasyJet levied a €12 fee, which was slammed as unfair by the regulator as this confirmation "could be easily given to the insurance company without any burden to consumers".
The watchdog also criticised Ryanair's website for having the "do not need insurance" option lodged between the Netherlands and Norway on a drop-down menu entitled "select the country of residence". It said this set-up was "unfair, cumbersome and misleading".
The anti-trust body has given Ryanair 30 days to set out how it intends to make its optional flight cancellation insurance easier for consumers to understand.
Ryanair's fine was larger due to the scope of the breaches of Italy's consumer code and the fact that the airline has broken the code several times. It said EasyJet had already made efforts to fix its website.
"We note this ruling and while we disagree with its findings and have instructed our lawyers to appeal, we will be amending our website accordingly," said a Ryanair spokesperson yesterday.
EasyJet, which uses Allianz to provide its insurance, said it has remedied the issues raised and that it was considering its options.
(c) 2014 City A.M.
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