Orbitz calls “reprehensible” opt-out policy an industry standard

Let me start by saying that I like Orbitz. I like its new CEO, Barney Harford. I like the hard-working folks in its customer service department. I like the way it uses technology to improve your trip.

But I do not like the way it pre-checks the option to buy travel insurance when you’re booking a trip, and I don’t buy its arguments for doing it. Neither does Joyce Carlson, who recently bought a trip through the online travel agency.

Here’s what happened to her: Carlson reserved roundtrip tickets from San Francisco to Tokyo. When she did, she found that the insurance option was checked, automatically signing her up for an Access America policy.

I definitely had not wanted to purchase travel insurance, because I get this insurance through my employer. I had to try to book my tickets several times, and each time I thought I had opted out of the travel insurance.

Unfortunately, the one reservation that took hold in the computer was one for which I evidently did not opt out of insurance. An email confirming I had purchased travel insurance arrived much sooner than the email confirmation for the flights, and I was not happy.

In a subsequent email to Orbitz, she didn’t hold back, calling the practice of pre-checking “reprehensible.” To which Orbitz replied:

We have found that many of our customers choose travel insurance when booking an international vacation to protect their investment in their trip should covered emergencies require that the trip be cancelled.

Therefore, we default to “Yes, Add Ticket Protector Plus” to provide this peace of mind. You may choose “No thanks. I prefer to decline Ticket Protector Plus.” on the Traveler Information page during the booking process.

Since 10 days had passed since she unwittingly purchased the policy, she was stuck with it. Carlson says she was unaware she could get her money back within 10 days, otherwise she would have asked for a refund. But the terms were hidden away on a PDF file that needed to be downloaded.

When I read her email, I thought it was a mistake. After what I’ve written about unethical pre-checking in the past, I honestly didn’t think Orbitz would do this. So I asked. Here’s my correspondence with the company:

Me: This must be a mistake. You’re not pre-checking the box for insurance, are you?

Orbitz: Let me check on this.

I’m not certain if below is the same, but we do suggest insurance in some cases, which is an industry standard (other OTCs do this too) for some packaged travel and international travel because of the high dollar volume involved for consumers.

We disclose this however and enable customers to opt-out if they don’t want it. But when you’re booking a prepaid package (much of which at times can be non-refundable) where your already experiencing a tremendous savings because you booked a package, it makes sense to make insurance a part of the package as a protection. That is why I know we urge consumers to spend the money to do it, but they don’t get it automatically included…as they can choose not to include it.

Let me get back to you when I know for sure, but I’m pretty sure we following industry practices in terms of how insurance is sold.

Me: Thanks. I’m fairly certain the industry standard is not to pre-check, but to allow customers to choose insurance or other optional items on their own. I appreciate you looking into this.

Orbitz: Actually, Travelocity does it even for domestic air tickets. We don’t.

Can I call you tomorrow on this? I will have more details.

Me: Sure, I’ll be here.

That was three days ago. I’m sure my Orbitz contact got busy with all the volcano-related cancellations. But I’m deeply troubled by this exchange.

First, it suggests the industry standard is to pre-check for options like insurance. I strongly disagree.

Carlson wonders what might happen if other businesses did the same thing. “What if, when you finished purchasing a camera online, you mistakenly neglected to opt out from purchasing an overpriced camera warranty?” she asked me.

I’d be pretty ticked off.

And second, this business with “industry standards.” Look, I think Orbitz does a terrific job most of the time, but calling pre-checking an industry standard — and pointing to Travelocity — doesn’t make it right. It makes you look guilty.

Orbitz and Access America need to distance themselves from pre-checking, no matter how profitable it is.

Why? Because it’s the right thing to do.

(Photo: hmmlargeart/Flickr Creative Commons)

Update (4/23): Access America has refunded her policy. She received the following email from Orbitz:

I have contacted Access American and they have cancelled your policy and they are issuing you a refund of $67.62. Please allow 5 – 7 business days for the credit to post to your account.

Although, we are unable to erase the negative experience you had with us, we can act upon your feedback to prevent such occurrences in the future. In fact the constructive criticism of our customers is one of the most significant means of quality control and is helpful in detecting shortcomings. Please be assured that we are listening and that your constructive comments have not gone unheard.

As a gesture of our sincerity for your disappointing experience, Orbitz would like to offer you a $50 future travel voucher on your next Orbitz.com airline, hotel or vacation package booking. Our future travel voucher is meant to emphasize our commitment to you and we remain hopeful you will continue using Orbitz for your travel planning needs.

  • Carver

    Even a free marketer like me finds forcing customers to opt-out to be a highly unethical practice that quite frankly ought to be made illegal.

  • noah

    I also don’t like the opt-out police. And I think they should make it very explicit when they do have an opt-out policy.

    That said, I find it difficult to understand how people can so naive about doing online purchases, especially for something expensive like travel, and not read all of the available options before finalizing the purchase. We’re not talking about something hidden in fine print (like the refund policy is)–it’s right there when you do your booking.

    One one hand, yes, Orbitz should not be doing this. On the other hand, if people took responsibility for carefully reading what they were agreeing to, this would not happen. This isn’t a situation where the travel company is just fleecing a customer, who would have had no way of knowing what was going to happen. A little personal responsibility would easily avoid this problem.

  • vince

    This is called ‘negative option marketing’ and in some states it’s illegal.
    Attorneys General there can prosecute under Deceptive Trade Practices fraud laws.
    It out to be illegal nation wide.

  • Lianne

    Opt out policies are the online equivalent of walking up to the checkout at the grocery store and having the cashier throw a turkey in your cart while your back is turned. Awful.

  • Carver

    @Noah

    That’s easy. In real life, people make mistakes, fail to notice things, etc. The travel company knows that which is why they purposely take advantage of this inattentiveness. Otherwise they wouldn’t try to hard to keep the Opt-out default.

    The question is, should business conduct itself like a battleground minefield where every transaction must be scutinized to make sure that the customer is not being screwed, i.e. caveat emptor, or should we enforce better business practices so each transaction doesn’t require such a high level of vigilance?

    I’m a free market guy, but I strongly believe that free markets works best when consumers have easy and adequate disclosures.

  • Bill

    Well, I just double checked an international ticket on Expedia.ca and they do NOT pre-check the insurance. They do leave it blank so you absolutely HAVE to make some sort of selection, be it NO or otherwise….but there’s no pre-check to YES.

    Orbitz is in my opinion an unethical and annoying company. When “pop up” ads were first frustrating everyone – and there weren’t good blockers – Orbitz was right in there with pop up ads. When I suggested to them that it was an annoyance and they should find another way to advertise, they claimed that they had “no control” over the advertising. Yeah right. I’ve never bought anything from them and never will. They are right up near the top of my list of places to never deal with. I recommend Ms. Carlson and everyone else stop dealing with this company on a permanent basis.

  • http://www.claws-and-paws.com/ Douglas Muth

    Hmm, Carlson may want to reach out to her credit card company and see if they can help her resolve the issue. She could argue that since she never explicitly checked the box that it is an unauthorized transaction on her card, and chargeback the cost of the insurance.

  • J C

    It’s been several years since I’ve flown with Spirit Air’ but they used to do this with insurance. Don’t know if they still do.

    @Noah – I double and triple check everything I do and I almost missed it. Something didn’t seem right and I finally caught it. I’m big on – They make a business decision and then you have to make a consumer decision, but this isn’t simply a business policy, This is Predatory. A person shouldn’t have to go over a reservation with a fine tooth comb.

    Your right when you say that opt-out policies should be explicit. Carver was right on when he said that free markets work best when consumers have easy and adequate disclosures. This is trying to sneak something in under the radar and hope you don’t catch it. It’s unethical.

  • Steve

    I’m with Carver on this one. It’s funny to me that the government gets so involved over issues that IMHO they should stay out of, but then I never hear a politician calling out a company over something truly deceptive and unethical like opt-out policies.

    I like Lianne’s analogy, too.

  • Lisa S

    I only use Orbitz to get an idea of prices, and then I go directly to the carrier. Sounds like a pretty slimy action on the part of Orbitz. Unfortunately, a lot of companies engage in unethical practices just because they are legal. While I don’t want government regulation for every little thing, I would like to see the law provide a reasonable recourse for consumers who are exploited by companies. Good luck with the one, Chris. I don’t see Orbitz doing the “right” thing.

  • rich

    “If you don’t wish to not opt-out, please don’t not un-check the pre-checked box if it is not your disintent to not select travel insurance.”

    or……..something like that.

  • Craig

    The only ‘industry standard’ here is “In what manner can we screw our customers today”. Opt-outs are evil, no matter the industry or excuse.

  • Shannah

    The issue with pre-checking the box is that if you make a mistake filling in the form, and get an error message, the box gets re-pre-checked, even if you unchecked it. Filling out a web form sounds easy, but if it’s poorly coded, you can find the submission rejected for really stupid reasons. Phone number is a classic issue: some forms require dashes, some forms reject dashes, and I’ve even seen forms where one has to put the area code in parenthesis to get it accepted. I’m very sympathetic to Joyce Carlson on this one.

  • J C

    @rich – Well said

  • SirWired

    @Bill: Expedia is doing it the right way: many (maybe most) travel agents will require to make a decision about travel insurance one way or another when booking an expensive trip. This is to prevent you from coming back later claiming you wanted insurance but were not offered it.

    Pre-checking: bad
    Requiring you to make a choice: good

  • Matt

    I’m more troubled that it’s not even an Orbitz company that’s offering the insurance. I’m sure they have some sort of rev share agreement with the insurance company, but it’s still an unethical way for them to make more money.

    What it really comes down to is actually reading all the fine print before clicking the Buy button. Many sites are changing wording from ‘Check here to receive emails from us and third party vendors’ to ‘Check here if you’d like to not receive emails from us and third party vendors’. They know what they’re doing, they’re capturing your permission to bombard you with marketing and spam, and they’re making some cash from it. We, the consumer, have got to get used to reading EVERYTHING on the page. If I want or may want a refund then I’d either accept that I won’t ask for one or I’d better find the pdf and read it. If I then have trouble with it I SHOULD NOT BUY from that vendor.

    Orbitz may have questionable practices but the consumer needs to wise up and understand the deal we’re getting into.

  • Dave

    One of the many reasons why I never buy through Orbitz, Travelocity, Expedia, or any online “agency.”

  • David Young

    Maybe the Fed or other regulatory rulemaking body could issue a simple clarification: If you do not affirmitively choose to purchase something, it is considered an “unauthorized” charge to your credit card. Thus, the presumption will be that the charge is not authorized should there be a dispute.

  • Les

    @ Chris

    I hope you’ll update us on Orbitz’s response if one ever materializes.

    Also suspicious is @Carlson’s note that several tries to book during which she DID opt out failed …. and one in which she didn’t opt out … succeeded. A distrustful person (who, ME?) would wonder about the coincidence.

  • Phoenix Justice

    I just did a test on Expedia (my online agency of choice) and there is no “opt out” option for insurance. In fact, Expedia doesn’t pre-check either “I want insurance” or “I don’t want insurance”. I consider Expedia to be the “industry standard”, not Travelocity, so Orbitz might want to rethink their policy.

  • Jocelyn

    I recently booked a flight through Vayama where the travel insurance box pre-checked. I unchecked it, but somehow, I’m guessing when I made a change somewhere in my information before I completed the transaction, it got “re-checked.” Luckily, they and the insurance company, TravelGuard, allowed for cancellation of the policy within 10 days of purchase — all it took was one email, and the charge was removed from my credit card in a matter of a few days. While overall I think prechecking is just a sneaky way to get people to buy something they might not otherwise purchase, I think allowing ample time for cancellation, and a swift refund is the right thing to do if a company is going to precheck.

  • Phil

    Ah, another crying story from someone who bought from an online travel agency. She should have walked in to a brick and motar agency and spoke face to face with a travel agent who would have sold her exactly what she wanted and got it right the first time. Most agents ask, do you want insurance and the client can answer yes, or no. Don’t feel sorry for anyone that screws up buying from the internet. They have a choice, face to face with an agent or face to computer to a telephone, with endles emails and phone calls to get it right..

  • Sean S.

    @Phil – sorry my man, but purchasing on the internet is the way business is done now days, telling someone that it’s their fault for trying to do something online is absurd. The issue here isn’t that she should have gone to an agency, but rather an deceptive practice by Orbitz. Do you feel the same way about shopping online? Hell, I bought my last car over the internet and will gladly do it again. What travelers need to do is spread the word of good service from good sites and bad service and sites to avoid.

    @ Jocelyn – I can’t believe you are so accepting of the practice of Vayama, you unchecked a box and it got re-checked somewhere along the line and you don’t see a huge issue with that? That takes Lianna’s analogy to another level, now the checker threw a turkey in the cart, you told them no and took it out of the cart and they proceeded to throw another one in while you weren’t looking. I know how websites work, and by clicking a back button at some point probably took you back to a screen before the option for insurance, but again, that’s why they shouldn’t be selecting you in to the insurance, but rather requiring you to decide.

  • hmmm

    I’ve been looking at vacation packages to the USVI on the Delta website – the travel insurance option is pre-checked to select travel insurance. You have to opt out by checking no.

    The practice is similar to websites that pre-check the option to receive marketing emails. You have to read everything!

    @Phil – not all travel agents are as competent as you make them seem. I live in a small town with not many options for travel agents. I used one for a complicated trip and not only did she make a few mistakes but she also “couldn’t find” places/excursions I had found doing research on the internet. I had to email her the links so that we could include them in the package.

  • Robin

    Spirit Airlines used to do this, not sure if they do anymore because its one of MANY reasons I will never fly them.

    My last experience flying them involved trying to purchase tickets online and every time I “unchecked” the box for insurance and hit “purchase”, the reservation would be returned as “Could Not Process, Try Again”.

    I repeated the process at least 4 times before it went thru and apparently on my last try, I didn’t “uncheck” the box because not only did the reservation go thru, my receipt showed a fee for travel insurance for all three tickets.

    I tried to get it removed but Spirit’s customer service line was “down” and they couldn’t do anything about it. I waited out 4 calls and several hours to get the charges revoked but I’m guessing most people don’t have the time to deal with it and will just pay the $15/ticket.

  • Rae A

    DisneyWorld.com also pre-checks travel insurance when booking a package.

  • PauletteB

    Phil: You’re exactly the kind of person who drives pax AWAY from brick-and-mortar TAs!

  • Kathleen Eaton

    One of the things Carlson mentioned was how often she had to submit to get the reservation to take and the one that did take finally, did not have the pre-check unchecked. That makes the situation a bit different than just not paying attention to what one is agreeing to.

    I have encountered prechecks items when ordering other things on-line and when I uncheck the unwanted item, it checkmark reappears before the transaction is finalized, OR my transaction doesn’t go through and I have to do it all over again. This has made me suspect that unchecking the pre-checked item triggers a response that may trap you into accepting the item through multiple attempts to order. Its a really bad trend.

  • Steve

    “Don’t feel sorry for anyone that screws up buying from the internet. They have a choice, face to face with an agent or face to computer to a telephone, with endles emails and phone calls to get it right..”

    Yes. They also have a choice of paying extra to go to a travel agent (and I’m not saying that’s a bad thing; travel agents provide a service and of course deserve to be paid for that service) or doing it themselves. There’s a certain logic in saying that booking through an “agent” like Orbitz or Expedia makes no sense, as you can often find the same price booking directly through a hotel/airline, but saying that it’s foolish to ever book a trip yourself seems pretty silly to me. And the “opt-out” problem could just as easily have come up if someone booked directly through a hotel/airline; as Robin pointed out, Spirit Airlines did this in the past and may still do it.

    I’m always amazed by how many people will defend unethical business practices by blaming the consumer.

  • Jocelyn

    @Sean S — I did say that I thought it was sneaky. But if I knew someone was trying to sell me a “turkey” I didn’t want, I should keep my eyes open to make sure it isn’t put back in my cart. I also should be sure to check my receipt and if I find that I’ve been charged for the turkey, I should be able to return it and get my money back, no questions asked. I wasn’t vigilant to make sure the insurance wasn’t tacked back on. We read a lot about online travel companies that won’t refund money, and when they do, don’t do it in an expedient manner. In my opinion, vayama and travelguard got the first part wrong (from the consumer prospective) by pre-checking, but got the second part right by offering a quick and easy refund.

    Trust me, I’d be much angrier if I hadn’t been able to get a refund!

  • Ernest

    @Phil – not all travel agents are as competent as you make them seem

    I use a brick and morter agent who insisted on insurance. Trouble was that when the incompetent agents trips failed to materalize, the insurance she insisted on didn’t cover it.

    It all goes back to reading the fine print and making sure you know for sure what is going on, its not about trusting a ‘real’ travel agent.

    Just why are you so sure that a brick and morter agent would not have screwed up?

  • Boris

    The same thing just happened to me, so Orbitz hasn’t changed its ways.

    What’s particularly reprehensible is that the email from Access America is designed to look like spam. Usually when I get email from a company I’ve never heard of telling me to open a PDF to get the information I “requested”, it is spam.

    Luckily I was able to cancel my policy. It is only possible to cancel the policy on the phone with Access America, not via email to either Access America or Orbitz or on the web. (There’s a link to cancel the policy on Access America’s website, but it isn’t functional.)

    Whether or not this is legal (I thought it was outlawed by the Restore Online Shoppers’ Confidence Act) it is very, very sleazy.

  • Joan_wedding

    It is definitely deceptive.  I experienced the same thing when I booked my flight last night.  There is nowhere else while you are booking the flight that indicate that you have selected this, not even in the final confirmation page where you are paying for the tickets.  I was able to call them this morning and canceled the insurance (which fortunately was easy to do), but others may not be so lucky.  Definitely deceptive on the part of Orbitz.