Yahoo Finance TD settles lawsuit over COVID-19 travel insurance claims
TD Home and Auto Insurance Company has agreed to settle a class-action lawsuit over some travel insurance claims it denied, primarily affecting Canadians who had their trips cancelled as a result of COVID-19 travel restrictions.
The lawsuit alleged the Toronto-Dominion Bank subsidiary had breached its insurance policy terms by refusing to honour claims for trip cancellation benefits and provide full compensation where credits, coupons or vouchers were available.
The insurer has agreed to pay a sum of $5.1 million as part of the settlement, $4.8 million of which will be distributed to compensate class members. The remaining $300,000 will cover administration costs.
Customers who were insured by a TD travel insurance policy between March 16, 2018 and Oct. 15, 2021 may qualify if they had their trip benefit claim fully or partially denied based on receiving non-monetary compensation, such as vouchers, coupons or credits instead of cash refunds. This means the customer must have already filed a claim for trip cancellation with TD.
Compensation will be distributed to three groups. The first includes travellers whose claims related to amounts paid to certain airlines that changed their policies after the class action was filed. Airlines and travel providers including Air Canada, Air France, Air Transat, British Airways, Emirates, Porter, Ryanair, Sunwing, Swoop, United Airlines and WestJet had previously only offered credits for cancelled trips but changed their policies and made cash refunds available for certain periods. Despite being reimbursed by airlines, those in this group can receive $100, regardless of the amount of their claim.
The second group will include travellers whose claims did not meet the travel date and other conditions set by the airlines. They will receive approximately 40 per cent of the value of the claim denied as a proportion of the settlement amount and can keep the credits they received.
The third group includes those that qualify for both groups and will receive $100 and about 40 per cent of the denied claim.
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Law firms Samfiru Tumarkin LLP and Adair Goldblatt Bieber LLP launched the class action on behalf of lead plaintiff Kevin Lyons, who is said was denied a claim for trip cancellation coverage after his travel plans were nullified in March 2020 due to the COVID-19 pandemic.
According to the class action, Lyons was reimbursed only $78.97 for the non-refundable portion of his Airbnb reservation out of his $6,673.36 claim. He was denied the portion relating to his family’s flights and cruise.
The lawyers involved estimate there are around 8,800 Canadians eligible to file a claim.
TD said it had no additional comment on the proposed settlement.
The agreement to settle the case was reached earlier this month and will be considered by the court on Feb. 17, 2023.
• Email: dpaglinawan@postmedia.com | Twitter: denisepglnwn
