Now that’s what I call an ethical customer!

Behind the scenes, employees often grumble that their customers would do anything to get a deal. They justify their own misrepresentations by saying consumers lie, too.

But not all travelers are ethically challenged. Exhibit “A” is Jeff Peterson, who sent me a question yesterday that I’ve never been asked.

My parents had booked a roundtrip nonrefundable flight on Delta for July and purchased travel insurance on the flight through Access America. When my mom died in April, I submitted her death certificate to Access America. I was assigned a claim number through their site and a resolution was promised within 10 business days.

When I hadn’t heard back (including my sending a followup email) by 14 business days, I contacted Delta to see if they would refund the cost of the tickets. I had looked up their contract of carriage and it stated that refunds are possible upon death of the traveler. I sent Delta a copy of the death certificate and am waiting to hear back from them.

Now I’ve received notice from Access America that they have sent refund checks for the cost of the airline tickets.

My question is: If Delta also refunds the ticket cost, do I need to return the money to Access America?

I understand that it’s not morally kosher to make money on this. However, an insurance policy was paid for to cover this eventuality. Also, shouldn’t Access America be aware of Delta’s contract of carriage and have contacted them for a refund themselves? Although, since I haven’t yet heard from Delta; maybe that is what indeed has happened.

I put that question to Access America. Here’s what it had to say:

Mr. Peterson is right, an insured customer can’t collect twice for the same loss.

We do have a system in place that checks if an airline provides a refund to our customer. In this case, the system has noted Mr. Peterson’s refund from Delta and we have contacted him to request a return of our payment.

We’re pleased that Mr. Peterson was served well by both Access America travel insurance and Delta, and we look forward to serving him again.

Well, I’m impressed. I spend a fair amount of time talking with employees, who waste no opportunity to tell me how morally challenged their customers are. And I’m sure some consumers would have looked the other way when they received two refunds. Not Peterson.

If you’re wondering — but does it go the other way? — then I have equally encouraging news. A vast majority of companies, when they realize they’ve double-billed a customer, will offer an immediate refund. Some don’t, unfortunately. They blame a supplier or cite a meaningless policy. But most do.

So I guess that’s the encouraging news of the day. Ethics are alive and well in the industry — on both sides of the counter.

(Photo: jalals pages/Flickr Creative Commons)

  • Liz

    That’s what I call “not committing insurance fraud”!

  • John R. Strohm

    Chris, I think you might want to take another look at this one.

    Jeff said “I sent Delta a copy of the death certificate and am waiting to hear back from them.”

    Access America said “In this case, the system has noted Mr. Peterson’s refund from Delta and we have contacted him to request a return of our payment.”

    It appears to me that Delta has not yet refunded Jeff’s tickets. Until and unless Delta pays off, Access America is obliged by its contract with Jeff to pay the claim, and Access America appears to be saying that they have jumped the gun on their request to Jeff.

  • RandyB

    I would have said that Mr. Peterson would have been served well if his claim would have been worked within the time frame that Access America gave him. If they had then he wouldn’t have had to involve Christopher.

  • Joe Farrell

    wellll – lessee -

    1 – he has not been paid twice yet;
    2. – why is he asking? An ethical person would just refund Delta’s money
    3. – isn’t this all just a bit premature?

    If pigs had wings they could fly.

    Why did Access America send a notice it was going to send checks; instead of just sending checks?

    Here is what you ought to do -
    If Delta sends you checks, CASH THEM immediately – get contrrol of the money.

    Then immediately send a letter to both company’s CEO asking them to send you a letter as to what to do. Be clear and specific and tell them they have 30 days to respond with a joint response or they will be considered to have abandoned the refunds. They do it to us all the time, you do it them. Tell them you will ONLY accept a letter which provides the same information to both. Send the letters certified mail return receipt ot prove they BOTH got the letter.

    Generally, the law in this situation is that if both insurance and Delta pay you, then the insurer gets refunded but I would lay money on that Delta COC states that it gets the refund if you have insurance and the insurer’s policy states that it gets the money. So – you can see the issue – they need to agree on a course of conduct and you need a letter which tells you what to do.

    Honest men do not have to ask about moral acts – but everyone needs to know the law.

  • Sice

    I think that Access America is not acting ethically here. If Mr. Peterson paid for trip insurance then Access America should be on the hook for the cost of the plane tickets, not Delta, regardless of Delta’s policy on refunds. If Access America were acting morally here then they’d at least settle to pay the trip insurance amount to Delta rather than making that money with NO risk of having to pay anything out (unless there were other claims for things like hotel or rental car on top of airfare).

    Chris, take FlyerTalk with a grain of salt, if anyone is looking ot cheat the system they’re most likely on FlyerTalk…

    As for Delta refunds, get the local Atlanta Delta refund phone number and call and talk to a person directly. They’re GREAT to deal with and will help with any refund issue you have.

  • Charles

    There is one important bit of advice here that I’ve yet to see stated: Read your travel insurance policy. I looked at a Travel Guard policy I have and it says it will reimburse “forfeited, non-refundable prepaid deposits or payments”. So, the next task is to determine what is non-refundable. He should have contacted Delta first to see if the ticked could be refunded. The insurance policy is designed to refund what is not reimbursed from somewhere else.

  • Kevin

    I thought standard practice was to take the money and see if Access America notices the problem. And if they notice the problem, Then Access America can call Mr. Peterson. If Access America doesn’t get the issue resolved, then
    Access America can send a letter explaining the issue and ask for a refund. And if the letter gets ignored, Access America can send another letter requesting a refund. And if that fails, then Access America can write a letter to Elliot explaining the issue. And then Elliot can call Mr. Peterson, and have Mr. Peterson explain that it was just a misunderstanding and that it was always Mr. Peterson’s intent to do the right thing. And then Access America can get their money refunded 6 months later.

    Isn’t that how it is supposed to work?

    [Obviously, I am trying to make a point and not advocating any false insurance claim.)

  • barbie45

    It really irritates me to no end how some of these so-called Non Profit organizations are so hypocritical. Take for example the salaries of many non- profit charities take.The salaries of some are illegally high. Red Cross for example. Kevin great tongue in cheek and so true.

  • Ed

    I guess I’m confused really.
    How is it insurance fraud?
    Let’s say you take out a term life insurance on a relative. Then you take out a second policy of whole life for the same relative. If that relative dies within the timeframe dictated by the term life insurance policy, then both of the policies should pay out!
    The same occurred here. Delta says that they have a return policy if there is a death of the ticket holder. The customer purchased insurance that covers the same eventuality. If the ticket holder dies, then yes, I would think that *BOTH* policies should payout. Simple at that!
    How would this have turned out if the ticket was a refundable ticket? In that case, I would definitely say that the money should be paid back by both parties. The insurance company has no ties with the airline, so their payout requirement is dictated by the terms of the policy and should have no ties to the airline. It is a separate entity.

  • noah

    “Take for example the salaries of many non- profit charities take.The salaries of some are illegally high. Red Cross for example.”

    @barbie– illegal under what law?

  • Lianne

    @Ed

    It depends on the terms of the insurance but ravel insurance isn’t intended to be life insurance.(Though some travel insurance does provide an accidental death and dismemberment clause should something happen *on* the trip but I digress).

    Just a quick glance at the FAQ on Access America stipulates that travel insurance is intended for *non-refundable* expenses due to travel interruption, and its not too much of a stretch to think that the actual contract contains appropriate verbiage. If Delta refunds the fare then accepting monies from the insurer is breach of contract and indeed fraud.

  • Joe Farrell

    and a PS: Access states that Delta refunded the money – but no where is that confirmed by our OP. So – did DL pay? Even so, the same question remains – which is what does Delta’s contract of carriage say and what does the policy say about 3rd party liability and can they be reconciled?

    Access America does NOT let you view a sample policy before purchase – but they do have the general exclusions:

    “In addition to any other exclusions that may apply to a particular benefit, no coverage is provided for any loss that results directly or indirectly from any of the following unless as specifically included: existing medical conditions; intentional self-harm, suicide or attempted suicide; pregnancy (unless unforeseen complications or problems), fertility treatments, childbirth or elective abortion; mental or nervous health disorders, (like anxiety, depression, neurosis or psychosis); use or abuse of alcohol or drugs, or related physical complications; war (declared or undeclared), acts of war, military duty, civil disorder or unrest; participation in or training for any professional or amateur sporting competition; participating in extreme, high risk sports; flying or learning to fly an aircraft as pilot or crew; nuclear reaction, radiation or radioactive contamination; natural disasters; epidemic or pandemic; air, water or other pollution or threat of pollutant release; unlawful acts; expected or reasonably foreseeable events or problems; financial default of a travel supplier; terrorist events; travel bulletins or alerts; and government prohibition or regulations. ”

    Think they could find pretty much ANY reason to cancel? ANY EXISTING MEDICAL CONDITION? So that means if you have a complication of an existing condition [the MOST LIKELY REASON for a trip cancellation] they do not have to cover you. Note that you are not even required to KNOW about the condition. Lets say you need to cancel a trip because of heart bypass. Even though you may have had NO SYMPTOMS from the blockage you obviously had a blockage developing – they can deny you.

    Participation and training or any professional or AMATEUR sports competition = lets say you break a leg playing tennis or golf. Nope – training for amateur competition. volcanic ash considered air pollution? Nope – they can refuse to pay for that.

    Airline, hotel or car rental go out of business – nope – not covered.

    ‘governmental regulation’ – once again, volcanic ask close the airspace – not covered.

    What do they cover? About all I can reliably state is getting hit by a bus, or other vehicle, while you were obeying all the traffic laws. Jaywalking and killed by a motor vehice? Not covered.

    And yes, after jumping through a few hoops I got their contract – and they have a subro clause – which is worded as follows:

    Recovery
    We have the right to recover any amount you receive that exceeds the total amount of your loss.
    Subrogation
    When someone is responsible for your loss, we have the right to recover any payments we’ve made to you or someone else in relation to your claim, as permitted by law. Everyone eligible to receive payment for a claim submitted to us must cooperate with this process, and must refrain from doing anything that would adversely affect our rights or the rights of Jefferson to recover
    payment.

    Now, is Delta ‘responsible for your loss?’ I would think that under these facts the insurer would have to pay for the loss given the death. But since Delta is not responsible for the loss, they are not entitled to subro against Delta. Thus, under the subro clause they would NOT be entitled to repayment. One must comply with the language of the contract right?

    Next, under the recovery clause, it would be interesting to see how a judge would rule on that . . .. I think general fairness requires a refund to access america – but only on their demand. This is a clause they must enforce.

  • Bill

    This isn’t all that hard. If the insurance pays, and Delta later refunds the money, then the insurance company should be reimbursed.

    Insurance is to cover you when no one else will.

    Good to see Mr. Peterson has ethics, but why did he have to ask? Wait until you have what’s due you and send the rest back to the insurance company.

  • barbie45

    Noah, I meant that sarcastically.Some chariots recieve only about ten cents on the dollar. Many of these so called non profit organizations are funded by very wealthy people as tax deductions. It is a not illegal but a very lucrative way to avoid taxes.

  • John Royse

    Let’s see – a passenger who doesn’t know if he should keep a double refund is now “ethical”.Are things that bad?

  • PauletteB

    @barbie45: Besides being off topic, what did the Red Cross ever do to you? Once again you use the “sarcasm” defense when anyone calls you on a misstatement. Anyone who is curious about who gets paid what simply has to check out Charity Navigator or a similar site.

    At least your posts always give me a good laugh.

  • jonbad

    It wouldn’t be worth keeping the double refund. Ask yourself, is your character really only worth a few hundred dollars?

  • laura townsend elion

    Hi Chris,

    A couple years ago you assited me with a problem I had with Disney while there for a business conference. Basically, Disney charged the wrong credit card and caused me some financial difficulties. Disney helped correct the error with my bank, and as a goodwill gesture, comped a portion my stay, which amounted to about $2,000.

    All this straightening out occured a bit after I returned from the trip, during which time I had submitted an expense account claim to my employer, who was by ready to to re-pay me for the stay. Then Disney informed me that some of the charges would be comped.

    I could have said thanks to Disney, and collected the check from my employer (who had no way of knowing my stay had been comped). Instead, I alerted my employer that in fact there would be no charges forthcoming for the stay. I never considered doing otherwise, but you would be amazed at the folks who could not believe I ‘turned down an extra $2,000.’

    Not only did doing the right thing fit in line with my sense of personal integrity, but rationally, my long term emplyment is worth more than a short term gain. Some of us are ethical, but it makes you wonder (over on your other column) how many folks get stuff for free that they make their employers pay for.

  • Amy A

    @ Kevin

    Couldn’t have said it better myself! Thanks for the laugh :-)

  • Mike

    @ laura, what you should have done, instead of allowing Disney to refund the costs is to have them issue a travel credit toward a future travel experience. I say this because your employer was on the hook for the charges and they should have paid you. You on the other hand were the one who was damaged and put out by the mistake and you should have been compensated. Your office did nothing to deserve the compensation, but that is what it got. Instead, what you did was gave your company free expenses and got screwed over at the same time with no compensation for your troubles.

  • Mekhong Kurt, Bangkok, Thailand

    This didn’t involve insurance, per se, but it does involve my getting money I didn’t feel I deserved, nor do I now, some 20 years later.

    My wife and I were moving from Texas to Macau so I could take up a new job. we had gotten a great deal on one-way tickets with a stopover in Beijing; in any case, I was going to be reimbursed for the ticket costs by my new employer, essentially the government of Macau, then a Portuguese colony.

    We had a several-hour layover in San Francisco before heading out on the next leg to Tokyo. My wife was out doing some shopping when I overheard one of the gate crew on the phone saying he still had five passengers too many, and that another airline’s plane wasn’t going to be able to wait much longer. I told him I could get my wife and we could go — it didn’t matter how much time we spent in San Francisco Int.ernational or Narita — so he sent me hurrying to get her.

    When we got back, he had someone waiting to rush us to the other airplane and handed me an n; in the rush, I didn’t check it since he said it was something for me later.

    Once aboard and airborne, I checked the envelope, and was startled to find a check of $800 for our having been bumped, when in fact we hadn’t been. Besides, our tickets had costs a bit less than that, each, in any case. I called it to the attention of a hostess, and she explained the refund was rightfully mine, whether the airline itself bumped us or we had volunteered to switch flights.

    But it didn’t end there.

    Once in Macau, I filled out the paperwork for reimbursement, with which I included a photocopy of the refund check and a memo explaining what had happened and requesting only that part I had actually been out for.

    The head of Accounting & Finance invited me to his office to explain face to face. I went through it with him, and he was somewhat startled that I hadn’t just taken the money and run. But I knew I was going to be very well treated (and I was), so even had I been tempted, I would have returned it. Or so I thought.

    He told me he’d get back to me in a day or two, and he did, showing up in my office with my reimbursement check for our two tickets. For the full amount I had paid. Before I could say anything, he spoke, and explained he had spoken with the territory’s Minister of Finance and Governor, and that one of them had contacted the national Ministry of Finance in Lisbon.

    The consensus was it would cost more, in actual expenses plus man hours to get all that properly entered into the books — so either Lisbon or the Macau government directed to toss the photocopy of my refund check from the airline and to tell me to forget about it.

    I still feel somewhat bad about it, especially since I was entirely exempt of Macau and Portugal income taxes; that $800 came out of taxpayers’ pockets.

    Not that I’m all THAT Mr. Goody Two-Shoes — we promptly spent the loot on some household items we hadn’t intended to purchase right away, such as a nice television!