Airlines face sky-rocketing claims for compensation following last year’s Supreme Court ruling sanctioning payouts for delays of three hours-plus when aircraft suffer technical problems.
The judgment in the Huzar v Jet2 case means technical defects are no longer classed as “extraordinary circumstances” under EU compensation rules.
Law firms soliciting claims forecast “a rapid rise in claims” and insist fares will rise just £2 as a result.
But the Board of Airline Representatives in the UK believe the regulations added £2-£4 to fares before the judgment.
Chief executive Dale Keller said: “The figure will be substantially higher as a result of the ruling. There will be more than double the number of payments.”
Keller reported “significant payouts in the last two months of last year”.
One network carrier identified delay‑compensation claims as now its “highest commercial cost”, while Thomas Cook set aside £40 million for compensation in its 2014 results.
The European Regions Airline Association warned last week that claims are having “a creeping effect on air safety”. Keller said: “We don’t want a situation where a captain makes a call on whether to delay a flight, which costs money, or to run back to base.”
Holiday flights are most vulnerable to delays, he added, saying: “A Greek island won’t have a hangar full of parts.”
Consultant Andy Cooper said the potential annual cost to UK carriers is €250 million if every passenger claims.
Claims firm EUclaim put the figure at £214 million last year and expects 25% of delayed passengers to claim.
UK manager Adeline Noorderhaven said: “Consumers sign a contract that states the airline will transport them at a specific time. If it doesn’t, it’s its responsibility to compensate for the damages that occur and loss of time. If an aircraft is technically unsafe, it is the airline’s responsibility.”
EUclaim charges 27% of a payout for successful claims, plus a €25 admin fee.
Cooper said: “If every passenger claims, almost €70 million a year would leak to claims companies. Ultimately, someone pays – and it will be passengers.”
Sourced from Travel Weekly