California and Florida issue statements on deceptive travel insurance opt-out practices

The insurance regulators for two of the U.S.'s major vacation rental markets — California and Florida — have issued statements against using opt-out sales practices to sell travel insurance.

In February, the Florida Office of Insurance Regulation issued an informational memorandum stating that online travel agencies that sell travel insurance by using opt-out methods are in violation of the state's Unfair Insurance Trade Practices Act. It advises that the practice of automatically charging consumers for ancillary travel insurance — unless customers take action to decline coverage — does not comply with the state's requirement of "informed consent."

Similarly, earlier this month, the California Department of Insurance issued a notice stating that using opt-out sales practices to sell travel insurance on travel websites violates state law. The department also notes that the California Insurance Commissioner can enforce pre-sale travel insurance disclosure requirements by imposing fines and suspending or revoking the license of any limited lines travel insurance agent.