Silversea drops FCC down to 110% on cruises they cancel

[clo]

4 hours ago, KennyMandy said:

Silversea's moving of the goalposts is worrying, and sadly is a company I would no longer trust with my money.

We have our first SS cruise booked for Fall '21 and cancel with refund of deposit until June '21. This thing is leaving a bad taste in my mouth and I'm getting tempted to cancel now and be done with them.

[alexandria]

On 9/16/2020 at 2:55 PM, milepig said:

I sort of think that 15% of the cost of an expensive cruise IS worth the effort!

Except the problem becomes:

• You have to leave your money with them and give up any future credit card protections, particularly charge back rights.  By accepting FCC, you also become an unsecured creditor and in the event of insolvency, would likely receive nothing. 
• By taking the FCC instead of the cash refund, you are "rewarding" an apparently untrustworthy company with your money and your business.
• You risk that as Silversea continues to suffer financially, they will later further reduce benefits that perhaps they can legally reduce.  No more butler service except in the Owners, Grand and Royal Suites?  "Sorry sir, tough times and all so we had to cut back, we are sure you understand."  Fried chicken and pot roast on the menu instead of steak, crab legs and dover sole.   "Our apologies sir, we are doing the best we can...thank you for being flexible."  Onboard credit?  "That offer was "adjusted" just before you boarded...you didn't really think it was sustainable for us to actually provide that for all who booked with that promotion, did you?  We appreciate your patience."  If they won't honor this, what else won't they honor?  And once they have your money for good, you are largely without much recourse.
• And frankly, having to "force" what is promoted as a top-shelf, luxury brand cruise line to honor their commitments would, in my opinion, detract from the anticipation, excitement and joy of luxury travel. 

Much easier to take the cash refund and choose another travel option.  And if these are the "new normal" business practices of Silversea, I suspect that a cash refund is the safest option.  Other than die-hard Silversea loyalists, I don't know many others who would put up with such shenanigans and still reward this company with their business.

[cruiseej]

I'm not trying to suggest I approve of Silversea's change -- it certainly seems wrong for them to change the terms of their Cruise with Confidence policy retroactively on customers -- but I do have a question: so long as all customers who booked previously can get a 100% cash refund, is this really a major problem for anyone? I'm assuming most people did not book and pay in full for a cruise with the intention of having it cancelled so they could score a future cruise credit with a bonus. So if you booked a cruise and it is canceled, and you get back every penny you paid, where is the harm? (No flames, please... Again, I think they should follow through on what was promised; I'm just trying to understand what problems it causes.)

[clo]

22 minutes ago, alexandria said:

I suspect that a cash refund is the safest option.

I very much appreciate your making the effort and time to write this. As I said above, we would be first time SS'ers. But not stupid when it comes to our money. I'm going to think about this some more. Again, thanks.

[alexandria]

4 hours ago, Stumblefoot said:

Absolutely agree.

 

Hopefully, since English isn’t Ms. Muckermann’s native tongue, I hope this is just a misunderstanding of meaning and SS clarifies their position.  I would imagine their phones are ringing off the hook from irate agencies and individual customers.

 

It certainly is reasonable that all new bookings made from this date forward will only be offered a 110% FCC or 100% refund.  But, to renege on a previous offer of 125% for existing bookings seems not only like a marketing disaster relative to customer loyalty, but also an illegal act.

 

Silversea has dug in their heels on this issue, management has spoken.  I don't anticipate they will change their minds now.  If they do, for some, it will be too little, too late.

 

You are absolutely correct in your assessment that Silversea's failure to honor the terms of the Cruise with Confidence policy in effect at the time of booking is impermissible.  As a now-retired litigator with thirty years experience in the courtroom, I would certainly be capable of pursuing the issue and believe I could prevail in a courtroom.  However, the only remedy would be for a court to issue an injunction compelling Silversea to honor the 125% FCC provision.  Otherwise, how do you measure damages?  You can already get a cash refund.  And by the time that happens, how much time and money has been spent?  Litigation can be very, very costly...multiples of the value of the 15% future cruise credit they are wrongfully withholding.  The cost-benefit analysis just doesn't make it worthwhile.  And I may be wrong, but I suspect Silversea and their attorneys have already considered this and are therefore taking the approach, "so what if we agreed, we changed our mind...sue us."

 

I also pointed out in a post earlier this evening the "pitfalls" of taking FCC after having to "force" Silversea's hand. 

 

Better to take the cash refund, share the experience with others who may be considering a cruise with Silversea, and find a different luxury travel option.  If they do this to enough people for a long enough period of time, you may see some of their fine vessels being beached at Alang before all is said and done.

[clo]

3 minutes ago, alexandria said:

Better to take the cash refund, share the experience with others who may be considering a cruise with Silversea, and find a different luxury travel option. 

Thanks again. Good and bad feedback on any "product" IMO is the biggest thing. 

[alexandria]

18 minutes ago, cruiseej said:

I'm not trying to suggest I approve of Silversea's change -- it certainly seems wrong for them to change the terms of their Cruise with Confidence policy retroactively on customers -- but I do have a question: so long as all customers who booked previously can get a 100% cash refund, is this really a major problem for anyone? I'm assuming most people did not book and pay in full for a cruise with the intention of having it cancelled so they could score a future cruise credit with a bonus. So if you booked a cruise and it is canceled, and you get back every penny you paid, where is the harm? (No flames, please... Again, I think they should follow through on what was promised; I'm just trying to understand what problems it causes.)

 

A very valid question.  In addition to the principle of the matter, a full refund by Silversea does not always make the customer whole. 

 

For example, those who booked independent air (either because airfare was not included in the cruise price or for other reasons) are likely out that expense.  While major airlines are extending travel credits, some are only valid for one (1) year.  Not much use if the next cruise you are looking at is in 2022.  Some travel insurance providers are refunding policies when a cruise line cancels, but not all.  That is another expense that a customer may not ever recover.  Those are just two examples that come to mind.  For me personally, I will have spent over $1,000 on airfare that I don't expect to get back and am unlikely to use within the next year.

 

So while you may get back every penny you paid directly to Silversea, you may have other non-refundable costs.  The 125% FCC can offset some of those otherwise "sunk" costs if they can't simply be moved to a new booking.

[Stumblefoot]

24 minutes ago, alexandria said:

However, the only remedy would be for a court to issue an injunction compelling Silversea to honor the 125% FCC provision. 

Two thoughts.  (1) I am not an attorney.  (2) Couldn’t a civil claim be made for both compensatory damages AND punitive damages since it seems SS has engaged in willful misconduct?  If the answer is yes, couldn’t the case be granted class action status, thereby ensuring not only an adequate return on attorney’s fees, but additional relief to class members beyond the promised 125% FCC?

[alexandria]

5 hours ago, Stumblefoot said:

Two thoughts.  (1) I am not an attorney.  (2) Couldn’t a civil claim be made for both compensatory damages AND punitive damages since it seems SS has engaged in willful misconduct?  If the answer is yes, couldn’t the case be granted class action status, thereby ensuring not only an adequate return on attorney’s fees, but additional relief to class members beyond the promised 125% FCC?

 

Unless Silversea had decided prior to the promotion and marketing of the April 8, 2020 Cruise with Confidence policy that they weren't going to honor it (i.e, a fraudulent scheme to lure customers into providing an influx of cash with no intent to fulfill the representations made), it is very likely that this would simply be a breach of contract case.  And in those cases, if one party fails to perform, the measure of damages is generally the cost to "cover", i.e, have the contract performed as though both parties fulfilled their end of the bargain, or the extra cost incurred to find another provider to perform the contract.  Well, in this case, what is that cost?  Let's assume a plaintiff could recover the 15% wrongfully withheld FCC.  On a $50,000 cruise, that is only $7.500.  Not a pittance mind you, but the costs of litigation would be multiples of that unless Silversea settled quickly.  And unless the terms of the contract provide for attorneys' fees for the prevailing party (and the contract with Silversea does not), each side pays their own costs.

 

As far as a class action, I'll let you in on a little industry secret...the only people who profit from that are the class attorneys.  The largest part of a class action settlement amount goes to attorneys fees and expenses of litigation.  What is left for the class members (Silversea passengers)?  Usually a fraction of the amount that an individual plaintiff could claim and sometimes it is just a coupon.  Seriously.  A coupon.  So let's say an action is filed and certified and approved as a class action.  In a couple of years, we might expect to receive notice of a settlement that provides we get $100 and a token discount off a future Silversea cruise.

 

So probably not worth pursuing from a litigation standpoint, IMHO.  Of course, I am not your lawyer!  🙂

 

 

[les37b]

How can you "buy with confidence" and expect customers to find that promises have been amended to your detriment?

 

If you change things, then that's for bookings being made from now, not existing.

 

My 4 bookings is already down to 3, but can very easily become zero, though I'm hoping a conversation I had on this very subject last week is not going to be undermined. 

 

[alexandria]

i learned that when our travel agent contacted Silversea about this issue, which was addressed by upper management, they sent her the July 2020 policy which provided "up to 125% FCC."  They are holding firm in their "no, it is only 110% for all existing bookings."

 

Since Silversea is paying TWO commissions for every passenger who accepts FCC (one for the cancelled cruise and one for the rebooked cruise which is likely to be a higher cost cruise, thus an even higher commission), I wonder if this may also be an effort by Silversea to induce more customers to take the cash refund and save themselves thousands in commissions.  Maybe they have looked at the numbers and seen that even customers who are taking cash refunds are later booking another Silversea cruise.  They may have calculated that even with a certain loss of future business, they will still come out ahead financially by implementing this decision.  Of course, this is just speculation and conjecture on my part.

[alexandria]

I was able to do some research and find all of the versions of the Cruise with Confidence policy that Silversea released (https://web.archive.org) online.

 

I am attaching them and have listed the changes I see that they made with each amendment pertaining to future cruise credit if Silversea cancels. 

 

• March 2020, Silversea releases New Cancellation and Booking and Cancellation Options  (no date on the document)
• April 8, 2020 Cruise with Confidence program amended, provides guest will receive 125% future cruise credit if Silversea cancels.  No language permitting Silversea to make changes.
• May 14, 2020 Cruise with Confidence program amended, still provides 125% future cruise credit but Silversea now added language permitting corrections of errors, inaccuracies or omissions and permitting Silversea to withdraw offer.
• July 20, 2020 Cruise with Confidence program amended, now provides "up to" 125% future cruise credit.
• September 15, 2020 Cruise with Confidence program amended, now provides "up to" 110% future cruise credit.

So in my considered legal opinion as a practicing trial attorney for over twenty-five (25) years, Silversea is legally bound to provide the 125% future cruise credit for those who booked from April 8, 2020 until May 14, 2020.  I hold the same opinion as to those bookings taking place from May 14, 2020 until July 20, 2020.  However, for bookings occurring July 20, 2020 and thereafter, it appears that Silversea would be within their legal rights to provide reduced future cruise credit due to the inclusion of the language "up to" which first appeared on July 20.

 

IANYL, consult with your own trusted attorney if you seek legal guidance!  🙂

 

April 8 2020 Silversea Cruise with Confidence policy.pdf July 20 2020 Silversea Cruise with Confidence policy.pdf March 2020 Silversea New Cancellation and Booking Options.pdf May 14 2020 Silversea Cruise with Confidence policy.pdf September 15 2020 Silversea Cruise with Confidence policy.pdf

[UKCruiseJeff]

This opinion - and it is just an opinion - relates to geographics with UK based consumer laws.

 

FWIW, EU and to some extent Oz customers have consumer laws based on the UK model and there are different lesser rights and protections (perhaps more accurately non-existant rights and protections) for US customers. 

 

In simplistic terms, if the original offer actually says "upto 125%" then anyone using FCC henceforth wherever they are has whatever discount is offered dynamically when they make the future booking wherever they are including the UK.  in my opinion a variable discount doesn't constitute "unfair practice" as described under UK consumer law.  That is what they knowingly or unknowingly agreed to.  It could be taken to mean almost anything from zero upwards but below 25%.

 

If however WHEN THEY MADE THEIR BOOKING it stated simply and definitely "125% for any future booking" then they (within the markets I mentioned) are entitled to that discount once they chose not to take the refund because that is the agreement under "Consumer Confiodence" they purchased all other conditions presumed being satisfied.  Also if they have already made a booking at an agreed discount level eg 125% then that cannot be subsequently reduced for their existing bookings at the previously agreed rate simply at the whim of SS.  They can only vary the contract for fair reasons outside of their control but there might be finacial penalties and consequences for them if they did - but that is a different topic.  They cannot simply vary existing contracted bookings.

 

If SS is unmoved by these considerations UK et al and customers are forced to litigate then this would in the UK be likely at the mercy of a judge in a fast-track lower UK court and each determination doesn't set any precedent for any following case.

 

Good luck all.

 

Jeff

 

Edited September 18, 2020 by UKCruiseJeff

[alexandria]

Good observation UKCruiseJeff, thanks for helping your UK friends...

[AtMaui]

My 2 cruises on the Whisper in November were cancelled.  According to the email I received "A Future Cruise Credit valued at 110% of the total booking amount to be used to reserve a cruise....for all open sailings."  I'm taking the "15% savings on any new cruise date when booking before 9/30/21" since I know which cruise I want.

 

I'm disappointed but not surprised.

[etual324]

1 hour ago, AtMaui said:

My 2 cruises on the Whisper in November were cancelled.  According to the email I received "A Future Cruise Credit valued at 110% of the total booking amount to be used to reserve a cruise....for all open sailings."  I'm taking the "15% savings on any new cruise date when booking before 9/30/21" since I know which cruise I want.

 

I'm disappointed but not surprised.

Where did you see the  15 % savings on any new cruise   ????

Edited September 18, 2020 by etual324
spelling

[Stumblefoot]

4 hours ago, alexandria said:

So probably not worth pursuing from a litigation standpoint, IMHO.  Of course, I am not your lawyer!  🙂

 

 

Thanks, Alexandria.  Really appreciate the perspective.

 

I feel bad for all those passengers who had existing bookings made prior to Covid-19 for dates after November 1st and due to the Cruise With Confidence promotion chose not to cancel their voyage and waited for SS to cancel their voyage in order to receive a 125% FCC, in order to assist the cruise line and allow them to keep their cash.  Seems like such a slap in the face by SS to the customers they need the most.

[Tothesunset]

If all the cancelled cruisers opt for FCC, its going to be a long time, even when cruising restarts, before they start taking in real money. 

 

As each month passes does anyone else wonder if the cruise lines can survive in anything like their current form. Especially if, as seems increasingly likely, the world economy goes into reverse. 

[brimary]

TTS...Yes I am concerned at the survival of the cruise lines long term .Main reason for reaching this sad conclusion is the basics of the business rely upon common laws and procedures across all countries of the world involved in cruising itineraries which allow the individual cruise itineraries to be planned years in advance.We have only to look at our own UK situation where the four participating countries cannot agree on common regulations and are all producing different regulations.Sadly a nightmare scenario for the cruise industry and I cannot see a solution emerging in the near future ie 2021!

[alexandria]

24 minutes ago, Tothesunset said:

If all the cancelled cruisers opt for FCC, its going to be a long time, even when cruising restarts, before they start taking in real money. 

 

As each month passes does anyone else wonder if the cruise lines can survive in anything like their current form. Especially if, as seems increasingly likely, the world economy goes into reverse. 

 

 In that respect, Silversea may have done us a service as we opted for the refund rather than the FCC. 

 

In the event Silversea becomes insolvent, holders of FCC become unsecured creditors and likely would receive nothing.  No refund, no cash back, no cruise.  While travel insurance might provide coverage in the event of insolvency, since the customer would have used "store credit" to pay for the cruise, rather than cash, I'm not certain whether coverage would be available.  Also, with the current financial and COVID situation, if coverage is only for "unforeseen" events, the insurer may deny a claim on that basis as well.

 

So perhaps i should thank Silversea for convincing me to take the cash refund and end our business relationship, instead of complaining!  😉

[Silver Spectre]

15 minutes ago, alexandria said:

 

 In that respect, Silversea may have done us a service as we opted for the refund rather than the FCC. 

 

In the event Silversea becomes insolvent, holders of FCC become unsecured creditors and likely would receive nothing.  No refund, no cash back, no cruise.  While travel insurance might provide coverage in the event of insolvency, since the customer would have used "store credit" to pay for the cruise, rather than cash, I'm not certain whether coverage would be available.  Also, with the current financial and COVID situation, if coverage is only for "unforeseen" events, the insurer may deny a claim on that basis as well.

 

So perhaps i should thank Silversea for convincing me to take the cash refund and end our business relationship, instead of complaining!  😉

Glad to hear you are taking the pragmatic approach to this, please let us know how long it takes to get refunded. Perhaps if times revert to some sort of normality you may wish to revisit SS. Although the shoreside management can at times be less than ‘helpful’ the product is generally excellent and shipboard staff are outstanding.

[AtMaui]

My 2 cruises on the Whisper in November were cancelled.  According to the email I received "A Future Cruise Credit valued at 110% of the total booking amount to be used to reserve a cruise....for all open sailings."  I'm taking the "15% savings on any new cruise date when booking before 9/30/21" since I know which cruise I want.

 

I'm disappointed but not surprised.

 

----------------

 

Quoting from email dated 9/17/2020 from Barbara Muckerman:  "15% savings on any new cruise date, when booking before 30 September 2020."

[alexandria]

11 minutes ago, Silver Spectre said:

Glad to hear you are taking the pragmatic approach to this, please let us know how long it takes to get refunded. Perhaps if times revert to some sort of normality you may wish to revisit SS. Although the shoreside management can at times be less than ‘helpful’ the product is generally excellent and shipboard staff are outstanding.

 

Thanks for your reply.  However, absent a significant and public reversal of their position on this issue and making the situation right for all affected passengers, I don't see us ever considering Silversea again.  While they may have been an excellent company pre-COVID, this action speaks to a lack of integrity and a lack of interest in the satisfaction of their customers.

 

Based upon the decisions that they have made regarding this issue, I don't consider Silversea to be trustworthy and I simply will not patronize a business that does not honor its commitments and promises. 

Edited September 18, 2020 by alexandria
Spelling correction.

[Stumblefoot]

10 minutes ago, AtMaui said:

Quoting from email dated 9/17/2020 from Barbara Muckerman:  "15% savings on any new cruise date, when booking before 30 September 2020."

 

Very interesting AtMaui.  This is a new development I have not seen elsewhere.

It seems by moving to a 110% FCC, they are providing folks a way to receive the same value as the prior 125% FCC as long as folks re-book in the next 2-weeks.  Such action should increase bookings, whereas I imagine many folks of the prior 125% FCC are waiting to make a future booking as they have 2-years to do so.  Therefore, this policy change, if successful, will make it easier to access the debt market when necessary as long term net bookings will be positive.

AtMaui, do you know, if you make a new booking utilizing the new 15% discount, do you also receive the 10% EBB and $1,000 OBC?  My assumption is yes.

etual, Mr. Silver, and ZQTChas, it will be interesting to see if you receive a letter from Ms. Muckermann with similar terms once your voyages are cancelled by SS.

[UKCruiseJeff]

1 hour ago, alexandria said:

 

In the event Silversea becomes insolvent, holders of FCC become unsecured creditors and likely would receive nothing.  No refund, no cash back, no cruise.  While travel insurance might provide coverage in the event of insolvency, since the customer would have used "store credit" to pay for the cruise, rather than cash, I'm not certain whether coverage would be available.  Also, with the current financial and COVID situation, if coverage is only for "unforeseen" events, the insurer may deny a claim on that basis as well.

 

😉

 

You have put your finger on one of the important uncertainties. 

 

Once a customer forgoes a refund in favour of a FCC there is a disconnect with respect to the original transaction. It doesn't follow automatically that all the protections customers presume are there because they have not booked a further cruise but bought a "voucher" which has been provided and so the original transaction has been satisfied and completed and the original transaction therefore has ended with the full consent of the passenger.   Insurers will cover the exact risk when the insurance was taken out and arguably they have not been informed or accepted what is in effect a completely new booking and risk for what they could and probably would argue was not originally insured or purchased.   There may be a more hopeful outcome and opportunity for those with annual cover because it isn't for a specific cruise but that is also an "unknown".   Some insurers may accept to cover the FCC cruise but I think you'd need to hear them say so to feel safe.

 

There is exactly the same issue in the UK with respect to Section 75 credit card protection in that most customers buying cruises through an agent have very specifically limited cover depending on whether the cruise was a part of a package put together by the agent or not whereas those that buy direct have fuller protection although not complete cover.  However if the customer accepts a FCC instead of the refund then they do so with their eyes open and both insurer and credit card company can decide it was not the original covered transaction which was satisfied when the customer accepted a FCC.  I have good reason to believe the Ombudsman might take that view.

 

I suggested a long time ago that FCC was an odd choice in spite of the obvious risk for people as even if they get the full 125% they do not know what that 125% is 125% of because SS can adjust prices up and down and can if they want inflate the lead-in price so that offers and inducements to new customers are decent discounts and are seen as attractive and that they could choose to exclude those using FCC which rather waters down the discount. 

 

As many have long learned they seem to think they can do what they want.

 

Good luck all. 

 

 

Edited September 18, 2020 by UKCruiseJeff