Consumer Alert - Large FL Agencies Closing - Maybe?

[HarryB1964]

Here's a link to yesterday's Chris Elliott column about several large Florida Cruise Agencies being closed by Authorities for selling bogus travel insurance!

 

http://www.elliott.org/blog/florida-orders-travel-agencies-who-sold-unlicensed-insurance-to-stop-transacting-business/

[smeyer418]

thanks for the posting. These are only notices of intent to the operators. What tends to happen is that they enter into an agreement not to do it again and to pay a fine and are allowed to continue in operation unless the Florida Insurance department sees this as a pattern by this group or otherwise believes that the TA shouldn't be allowed to continue. Given the current job market most of the time they don't want to put the people out of work. I have dealt with the Florida Insurance Department and they are not happy campers and are pretty tough-as they should be- when someone transacts insurance business without a license. I have had dealings with Palm coast over the years and they have always done what they said with me. Its a tough time out there and some of the agencies mentioned will be closed and some will continue...you will have to wait and see what happens...me too.

[HarryB1964]

What tends to happen is that they enter into an agreement not to do it again and to pay a fine and are allowed to continue in operation unless the Florida Insurance department sees this as a pattern by this group or otherwise believes that the TA shouldn't be allowed to continue.

 

Certainly everyone is assumed to be innocent until they're proven guilty, but for starters, the agencies mentioned can be proven to have sold a succession of illegal products, without exception, dating back to at least 2003. They sold Trip Assured. They sold Vacation Protection Services. They sold Prime Travel Protection. Jerry Watson is the common thread here. He worked for all three fake travel insurance companies, and he sold the same illegal product, under different names, and from at least four geographic locations. All three travel agencies finally started to sell legal travel insurance...last month.

Given a choice, I sincerely hope that the three companies stay in business long enough to repay the claims due to their customers, and pay the penalties specified by Florida law. No negotiation should be allowed in these cases.

[Silvery Seas Cruiser]

That is all the more reason why I deal directly with Royal Caribbean. I don't know how one can assure oneself that any given travel agent is completely reliable unless by word-of-mouth.

 

But then look at Barry Madoff. Most of his accounts were word-of-mouth recommendations by very close friends and family and they all were wiped out.

 

Perhaps a travel agent here can help us sort out this issue of reliability and fraud in the TA industry. Is there some definite way one can be sure a TA is reliable?

[smeyer418]

Certainly everyone is assumed to be innocent until they're proven guilty, but for starters, the agencies mentioned can be proven to have sold a succession of illegal products, without exception, dating back to at least 2003. They sold Trip Assured. They sold Vacation Protection Services. They sold Prime Travel Protection. Jerry Watson is the common thread here. He worked for all three fake travel insurance companies, and he sold the same illegal product, under different names, and from at least four geographic locations. All three travel agencies finally started to sell legal travel insurance...last month.

Given a choice, I sincerely hope that the three companies stay in business long enough to repay the claims due to their customers, and pay the penalties specified by Florida law. No negotiation should be allowed in these cases.

 

 

 

a little short on sympathy aren't we?

 

Some of the time they GAVE the insurance away as a perk but that isn't the point.

 

I wouldn't mind if they had to pay the legitimate claims but I am sure that is part of a negotiated settlement. Most of the time negotiated settlements that people agree to are better than an award that is unenforceable and noncollectable. No one thinks that Madeoff will pay back a forfeiture of 170 billion dollars.

 

You ever wonder how people try to get guaranteed returns higher than the market and then claim they were duped?

[martinchem]

Amazing what the companies are trying to get away with.

[Dan Askin]

Hi,

 

Just a heads up that we're investigating this story. Just have the nuts and bolts up as of now, but stay tuned for more info.

 

http://www.cruisecritic.com/news/news.cfm?ID=3113

[rubytue]

I almost booked my next cruise with one of those :eek: At the last minute, I called HAL directly and the price was close enought that I went with HAL. Honestly, it was the CVC debacle that had me wary. Thank goodness!

[Dan Askin]

Hi,

 

As smeyer noted, we're just dealing with notices of intent at this point -- but for clarification, the cease and desist refers to the selling of unlicensed insurance and not the selling of cruises.

 

http://www.cruisecritic.com/news/news.cfm?ID=3113

 

Dan

[Arwenmark]

Interesting, as I just got an email today from one of those agencies offering "free insurance" as part of the deal.

[smeyer418]

Hi,

 

As smeyer noted, we're just dealing with notices of intent at this point -- but for clarification, the cease and desist refers to the selling of unlicensed insurance and not the selling of cruises.

 

http://www.cruisecritic.com/news/news.cfm?ID=3113

 

Dan

the article really is not clear about this(not the cruise critic article the one on Elliott's blog). I don't know if that was intentional or not. Palm coast has been in business 21 years its clearly not a fly by night. Its my understanding that you don't need a license in Florida to be a TA but I don't know that for sure either. In most states you need a license to sell any form of insurance(the car rental companies try to get around this by calling it a waiver of responsibility to them) but its rare that a state requires the licensing of a TA.

[fideauxdon]

In reference to Mr. Dan Askin's Article:

 

Cease & Desist Orders to Best price Cruises, Legendary Journeys, and Palm Coast travel were issued on 3/5/09. I'll try to have someone send him copies.

[Dan Askin]

In reference to Mr. Dan Askin's Article:

 

Cease & Desist Orders to Best price Cruises, Legendary Journeys, and Palm Coast travel were issued on 3/5/09. I'll try to have someone send him copies.

 

Thanks fideauxdon, I've checked out those filings, the "intent to cease and desist." We're being very careful to specify that they have 21-days to respond to the filing.

[Dan Askin]

the article really is not clear about this(not the cruise critic article the one on Elliott's blog). I don't know if that was intentional or not. Palm coast has been in business 21 years its clearly not a fly by night. Its my understanding that you don't need a license in Florida to be a TA but I don't know that for sure either. In most states you need a license to sell any form of insurance(the car rental companies try to get around this by calling it a waiver of responsibility to them) but its rare that a state requires the licensing of a TA.

 

Yeah, we're being very careful with the wording on this one. That was of course the primary issue in question: Stop selling cruises alltogether or stop selling insurance that you're not qualified to sell?

 

Another update coming shortly.

[smeyer418]

Yeah, we're being very careful with the wording on this one. That was of course the primary issue in question: Stop selling cruises alltogether or stop selling insurance that you're not qualified to sell?

 

Another update coming shortly.

You know this brings up an interesting point(to me anyway)....most if not all the cruiselines are NOT licensed to sell insurance..how do they get around most states prohibitions? A TA is acting as an agent for the cruise line when selling the cruise lines insurance and cruise(I know the cruise lines deny this saying that the TA is the agent of the cruiser) but aren't they doing the exact same thing when they sell the cruise lines insurance which is not licensed by Florida? or does Florida just decide to ignore that?

Thanks Dan- LOL you want to get into that one?

[Jade13]

Yeah, we're being very careful with the wording on this one. That was of course the primary issue in question: Stop selling cruises alltogether or stop selling insurance that you're not qualified to sell?

 

Another update coming shortly.

 

Dan,

 

This is scary because I am pretty sure that Best Price Cruises was somehow mentioned along with CVC. You would need to go through the threads. I thought some cruise lines may have had clients contact Best Buy as they were trying to help out with the missing insurance from CVC but of course in the process would gain new clients. This never made sense to me because CVC always offered another insurance that is real insurance. But I hope this is mentioned in the article because it's confusing when the cruise lines tell client s to talk to x agent and also 9in my case) last summer told me it was normal for some agents to charge credit cards to themselves and pay the cruiseline with a group check...

[Dan Askin]

Dan,

 

This is scary because I am pretty sure that Best Price Cruises was somehow mentioned along with CVC. You would need to go through the threads. I thought some cruise lines may have had clients contact Best Buy as they were trying to help out with the missing insurance from CVC but of course in the process would gain new clients. This never made sense to me because CVC always offered another insurance that is real insurance. But I hope this is mentioned in the article because it's confusing when the cruise lines tell client s to talk to x agent and also 9in my case) last summer told me it was normal for some agents to charge credit cards to themselves and pay the cruiseline with a group check...

 

You're exactly right about the connection:

 

http://www.cruisecritic.com/news/news.cfm?ID=2934

 

According to our piece, the insurance portion of the CVC debacle applied only to folks who had purchased Prime Travel Protection, which is what CVC was selling. CVC apparently hadn't passed on the insurance premiums, so folks lost their insurance policies when CVC shuttered.

 

Then Best Price Cruises swooped in to rewrite insurance policies for those who'd lost their PTP policies. Then PTP was liquidated. Yikes! So what do you when your insurance company goes belly up?

 

News on PTP's demise: http://www.cruisecritic.com/news/news.cfm?ID=3050

 

One particular quote stands out:

 

"My understanding is that this company did not sell an 'insurance' policy," Travel Guard spokesperson Dan McGinnity tells us. "If someone's saying [their product] isn't insurance so they don't have to register as a licensed seller, that's telling me he's also not adhering to the standards a reputable seller is adhering to."

 

Cut to a month later. Now Florida's Department of Financial Services is alleging that three agencies -- one of which is Best Price Cruises -- do not have a license to sell insurance. Also alleged, is that the agencies sold policies via an unlicensed insurer.

 

The moral: Buy insurance from a reputable company that's underwritten by licensed insurers that are regulated by state insurance departments.

 

 

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

 

In regards to agents charging credit cards, you should always review the statements and make sure that the actual charge is made by the cruise line, rather than the travel agency

[Shifra]

This definately caught my eye since most of my cruises have been booked through one of these agencies. In fact I have 2 currently booked through them but I buy the cruiseline insurance.

 

I hope this order means they have to stop selling insurance not cruises......

I will be closely following this story.

[Dan Askin]

This definately caught my eye since most of my cruises have been booked through one of these agencies. In fact I have 2 currently booked through them but I buy the cruiseline insurance.

 

I hope this order means they have to stop selling insurance not cruises......

I will be closely following this story.

 

Just the insurance Shifra, as confirmed in our last update:

 

http://www.cruisecritic.com/news/news.cfm?ID=3113

[Erica@cruisecritic]

For all of you following this story, here's our latest update:

 

What Does Florida's Insurance Crack-Down Mean for Cruisers?

http://www.cruisecritic.com/news/news.cfm?ID=3114

[smeyer418]

thanks for the update...

[aferguson]

Just a couple of FYI's.

First, The state put out correction on March 12, 3:30 pm that the notice ONLY APPLIED TO SELLING PRIME/VPS INSURANCE...NOTHING ELSE. (and that new notice is widely published in these blogs.

Second, Legendary Journeys has not sold Prime Travel Insurance since September, 2008. We have approximately 25 clients effected by the bankruptcy of this company and are working with all of them to resolve there problems created by this bankruptcy. We reinsured all of our 2009 clients (that still had Prime/VPS Insurance) with Travelex at our expense. We paid approximately $100,000 to ensure our clients protection from their bankruptcy. This notice applies to more than 150 travel agencies in Florida that sold Prime/VPS Insurance. The entire issue is sad for the entire travel industry but ALL of our clients are secure. Sincerely,

Al Ferguson, Vice President, Legendary Journeys

 

In reference to Mr. Dan Askin's Article:

 

Cease & Desist Orders to Best price Cruises, Legendary Journeys, and Palm Coast travel were issued on 3/5/09. I'll try to have someone send him copies.

[smeyer418]

http://www.elliott.org/blog/florida-orders-travel-agencies-who-sold-unlicensed-insurance-to-stop-transacting-business/

 

note that the article on the Elliott website has been significantly updated. It also contains an apology of sorts. The TA's may be liable for any unpaid claim from an unadmitted(not licensed to do business in Florida) company---which I said would seem fair as I stated before....They ARE not being put out of business only asked to agree to not sell unlicensed insurance products....and pay a fine...

[HarryB1964]

Mr. Ferguson's earnest plea is heartwarming. Now that he's admitted that he was deceived by Jerry Watson into believing that it was legal to sell Prime Travel Protection, will he clear the air by also admitting that he was deceived by McKinley Johnson and Jerry Watson, starting about eight years ago, into selling Trip Assured and VPS, both of which were mirror images of PTP, and tell us how he didn't realize that these products were illegal, despite the fact that a formidable number of states banned the sale of the products with Cease and Desist Orders?

I would urge everyone to read the complete text of the Blog referenced by Mr. Meyer, and also read the Cease and Desist Orders from Florida before deciding that Mr. Ferguson, with his careful parsing of words, is "Pure as the Driven Snow".

[navybankerteacher]

A related question is whether it is wise to book even the cruise through an agent. In today's environment, a lot of businesses are at risk of insolvency; and, as things get tough, there is always the temptation to cut corners. There are numerous cases over the years where agents have gone under leaving customers hoding the bag - for cruises paid for but not booked with the line. Sure, if that happens, many (but surely not all) of them get their payments back after insolvency proceedings -- but often after missing a particular cruise. Given the increasing uncertainty, it seems increasingly prudent to book directly with the line -- unless you are sure of two things:

A)The agent is, and will remain, solvent; and

B) The agent can get you a better deal.

 

Part of the fun is doing the research and dealing with the line yourself --and a frequently heard irritant on these posts is wondering why the agent hasn't gotten your documents to you as soon as passengers who book themselves get theirs directly from the lines.