BREAKING NEWS: Treasury to investigate travel insurance sales-2--J.

BREAKING NEWS: Treasury to investigate travel insurance sales-2--J.: "BREAKING NEWS: Treasury to investigate travel insurance sales


A probe in the sale of travel insurance is to be launched by the Treasury with a warning that new legislation may be needed if widespread mis-selling is discovered.

One option could be to require tougher self-regulation by the travel industry. Another may be to include it under the regulatory control of the Financial Services Authority.

A consultation process is to start in the autumn, taking in travel agents, trade bodies, insurers, consumers associations and consumers.

The Treasury was quoted as saying the government was 'prepared to introduce new regulation if there is evidence of widespread problems in the selling of these products, which cannot be adequately dealt with by self-regulation.'

The travel insurance industry is estimated to be worth �650 million this year with more than 20 million people taking out cover, the Treasury says. But policies can vary in price by more than �200 for similar levels of protection.

The travel industry led by ABTA successfully lobbied against regulation following last probe into the sector in 2003, saying travel agents' own rules were providing adequate consumer protection.

Announcing the new probe, treasury minister for regulation of financial services Ed Balls was quoted by the BBC as saying the first step would be to talk to the industry to collect information.

He reportedly said: 'Our investigation will ask whether it's fair to put all the pressure on ordinary families to read the small print and ask the right questions to make sure they are properly covered.

'It will ask whether the travel industry should be doing more to ensure families are not left high and dry on their holidays a"