UPDATE: Tour operators complain insurers refuse to sign contracts

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MOSCOW, Mar 20 (PRIME) -- Insurance companies have begun to massively refuse to sign financial liability insurance deals with tour operators, which threatens many companies to leave the market in April, Vladimir Kantorovich, first vice president of the Association of Tour Operators of Russia (ATOR), said in a letter to the central bank’s Chairwoman Elvira Nabiullina seen by PRIME on Friday.

“Insurance companies that massively began to refuse insurance to tour operators were the first ones to respond to the unprecedented situation in tourism associated with the closure of most tourist destinations due to the spread of coronavirus. We understand that not a single company wants to bear possible risks, but at present such can be regarded exclusively as an undermining of the entire tourism industry,” the letter said.

Tour operators in Russia are required to have financial security of responsibility to consumers – either in the form of an insurance contract or in the form of a bank guarantee.

“It is obvious that tour operators that are currently experiencing unprecedented pressure from consumers, partners, state regulatory authorities, which they were not ready for, since no one could have foreseen the onset of a global pandemic, are now forced to single-handedly solve the practically insoluble problem of obtaining financial security, without which in April they will be excluded from the register,” Kantorovich said.

According to ATOR, 357 out of 535 tour operators involved in outbound tourism now have a minimum financial support in the form of insurance in the amount of 10 million rubles, 139 companies in the amount of 50 million rubles. Only 39 tour operators have insurance of over 50 million rubles. On the whole, total financial responsibility of tour operators to consumers secured by insurance contracts is currently over 23 billion rubles.

“At the request of the Russian central bank, ATOR is currently preparing a list of tour operators that have difficulties with extending financial liability insurance agreements. A list of insurance companies with which tour operators have problems extending insurance contracts has also been submitted to the Russian central bank,” a spokesperson for ATOR said.

(80.1570 rubles – U.S. $1)

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