Travel suppliers, from hotels to cruise lines, are relaxing
cancellation policies in hopes to ease apprehensions people may
have about traveling under the treat of war and a sluggish
economy.
By waiving cancellation fees, suppliers are trying to retain
customers who want to travel, but may be hesitant to book if there
is a chance they might be paying a price down the line due to
unforeseen circumstances.
“There are concerns expressed by travel agents and their clients
that if there is [a war], will my investment be protected,” said
Patrick Clark, vice president of communications with Uniworld, a
cruise line offering cancellation protection. “We’re helping them
to make their decision.”
The travel industry continues to limp along, with the threat of
war with Iraq compounding the slowdown of the last year and a half.
Lodging was stagnant last year. Room demand increased less than one
percent, and occupancy rates are still low. The cruise industry’s
“wave season,” traditionally the strongest time of the year for
cruise lines, is showing some softness just a month into the
quarter. Royal Caribbean has reported that bookings have been lower
than expected due to the possibility of war with Iraq and the
economy.
Though travelers have had the option of purchasing travel
insurance at an additional cost and insurance companies have been
quick to create plans to cover the growing concerns of war and
terrorism, suppliers rarely offer cancellation protection. Many
hotels waived cancellation fees after September 11, especially
those in New York.
But suppliers now view cancellation protection as a way to offer
people a little peace of mind and some incentive to keep
traveling.
Cancellation fees can be costly, however. Most cruise lines only
offer partial refunds for cancellations less than 90 days before
departure and many will not give a refund if the trip is canceled
within a month of the departure date.
SeaDream Yacht Club is joining Uniworld to offer protection for
their customers. But where Uniworld offers a total refund in cash
and travel certificates, SeaDream is giving travel credit for
future cruises that is good over a two-year grace period.
Changes in cancellation policies are not limited to cruise lines
alone. Tour operators and hotels are offering deals to keep valued
business.
Island Destinations, a luxury tour operator, recently debuted
its “Peace of Mind” cancellation policy, which guarantees agent
commissions even when clients cancel a trip.
Inter-Continental Hotels is also offering a break on
cancellation and attrition fees in an effort to hang on to its
coveted business clientele. Business travel and meetings account
for roughly 35 percent of all of the hotel chain’s revenues. And
cancellations for meetings of 30 to 40 people over two days can run
from $10,000 to $30,000.
“It’s more of a proactive measure than anything else,” said
Stephanie Bezner, a spokeswoman for Inter-Continental, about the
change in policy. “It’s one thing we are trying to do to alleviate
the anxiety many people are feeling.” Inter-Continental will offer
the program at 44 of its hotels across the Americas, including the
U.S., Canada, Mexico and Central America.
