On travel sites, the pre-checked box checks out

The pre-checked box, a clever technique that travel companies use to extract a few dollars more from customers booking their trips online, may be checking out.

Last month, the Minnesota Department of Commerce alleged that National Union Fire Insurance and Travel Guard Group had violated state law by automatically enrolling consumers in travel insurance without their express consent when they booked on Travelocity.com.

Unless they specifically opted out of the insurance, customers were buying policies that cost $25 to $45 per traveler, according to the state. The companies have agreed to issue nearly $2.5 million in refunds and pay a $250,000 civil penalty.

And in January, the Transportation Department’s new full-fare advertising regulations for airfares went into effect. They include a rule that prohibits so-called opt-out provisions in ads, further closing a loophole that had cost consumers millions and generated thousands of complaints.

No surprise, then, that online agencies are slowly backing away from the practice.

“Opt-outs are no longer being presented to consumers via our member companies to the extent that they were offered before,” says Joseph Rubin, president of the Interactive Travel Services Association, which represents the major online travel agencies, including Travelocity.

To get a sense of what was wrong with opt-out, let’s rewind to a 2010 column of mine on this subject. In it, I spoke with customers who booked airline tickets online only to discover that a box indicating that they also wanted to buy optional travel insurance had been pre-checked. I interviewed Terri Widder, a retiree from Carol Stream, Ill., who bought American Airlines tickets through a site operated by Travelocity. She nearly ended up with precisely the same insurance that Minnesota took action against: a Travel Guard policy.

At the time, a Travel Guard spokesman said that opting out instead of in was well on its way to becoming a “standard” in travel. He told me that the complaint rate on the company’s policies had been less than one-tenth of 1 percent.

A Travelocity representative also said that most of its customers — more than eight in 10 — uncheck the box before they click the “buy” button. If they had buyer’s regret, the site allowed for a refund within one credit card billing cycle.

Travelocity declined to comment on the Minnesota ruling, because it was not party to the settlement. (The online agency made its decision about opt-out marketing in consultation with the travel insurance companies, but the insurers approved the way in which their products were sold, according to Travelocity.) But the agency defended its opt-out practices.

“Travelocity believes that our 16-year track record of providing great values for consumers and being their advocate speaks for itself,” says Joel Frey, a company spokesman. “We viewed pre-checking travel insurance as a service to our customers, and we rarely received any complaints about it. We went out of our way to ensure that the manner in which we did that was not deceptive to our customers.”

Although Travelocity no longer asks its customers to opt out of purchases, Frey says that the practice benefitted travelers because it allowed them to “give greater consideration to the need for travel insurance, something we believe they tend to undervalue until they need it.”

But Minnesota’s actions, plus the recent federal ruling, probably mean that other states will consider similar actions against the opt-out box, says John Cook, president of QuoteWright.com, a travel insurance site.

“Tour operators, travel agents, motor coach operators and cruise lines that use the same marketing method for travel insurance could put the insurance company at risk for a deceptive practice,” he says. “My gut reaction is that we’ll see more enforcement actions from other states and involving other companies.”

It could spread to other industries, too. When’s the last time you tried to sign up for a “free” offer online, only to find that the radio button signing you up for the company’s newsletter had been pressed, too? Pre-checking is done almost everywhere, though not to the same level as in online travel.

I agree with Travelocity that more people should consider insurance when they travel, but making them opt out isn’t right. I’m also certain that making customers uncheck the box was profitable to companies selling travel online and that at some level money, and not the welfare of their customers, was a driving motivator.

Travel companies are constantly innovating and pushing the boundaries, and if they can figure out a way to nudge you into making an online purchase while not breaking the law, they’ll try. I can’t see what’s behind the firewalls of the usual suspects — the discount airlines and tour operators whose business models depend on deception — but I wouldn’t put anything past them.

The only way to ensure that opt-out is properly euthanized is to hammer away at it whenever you see it. If you find yourself paying for something you don’t want, it’s not enough to get your money back. Send an e-mail to the Department of Transportation, the Federal Trade Commission or your state insurance commissioner. Tell them what happened.

Opt-out marketing is a deceptive practice, according to the federal government. It’s up to us to keep up the pressure until it goes away.

Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at chris@elliott.org. Got a question or comment? You can post it on the new forum.

More Posts - Website - Twitter - Facebook - LinkedIn - Google Plus

  • finance_tony

    One one hand, I’m glad it’s going away.  (Now can the same be done for automatically enrolling in promotional emails?) 

    On the other hand, one could argue that it’s just a natural progression of the unbundling of services that consumers seem to like so much.  What used to be leniency on the part of the airlines in the case of e.g. illness before the flight has turned into an unbundled service that’s tacked on for an extra fee in order to make the fare look cheaper.  It’s just that the service is provided by a third party.  How about a “Yes!  I’d like to have on-board restroom privileges during the flight” checkbox?  Should that be automatically checked?

  • Elmo Clarity

    “Yes!  I’d like to have on-board restroom privileges during the flight” checkbox?  Should that be automatically checked?

    As long as it doesn’t cost anything extra then it can be automatically checked.  But if there is a cost involved, it cannot not according to the law.

  • finance_tony

    Exactly – and just how many of Chris’s readers would complain if the checkbox were unchecked and then were charged $10 on-board to use the restroom?  OK, I get it, that’s a hypothetical, and a bit ridiculous.  But admit it, it sounds less ridiculous than it would have ten years ago.

    I’m just pointing out that some travelers (some of those writing to Chris as an example) tend to not understand that unbundling involves loss of services as well as a shedding of nickel-and-dime fees.

    Don’t get me wrong; I’m all for the rule.  But I wonder if it will affect the number of customers who, after the fact, decide that the practice of making them opt-in for various services that “should be included” is similarly deceptive.

  • KMiller4816

    Regardless of “for” or “against” the practice, one should remember travel insurance as a possibility when traveling — particularly if making a large trip investment or going outside the US.  Buyer bewaer on where you buy it too.  Consider form an agent or the travel ins co, versus the site or travel supplier offering.

  • Stuart Gustafson

    Caveat emptor. Are there some items where a pre-checked box makes sense? Yes, but it should be clearly pointed out to the consumer before it becomes an automatic buy. This is akin to the forced continuity programs used by some marketers where you’re automatically enrolled ina program and start paying after a “Free trial” period.

    Thanks for being a beacon of “watch out for’s” to the consumer, Christopher.

  • TonyA_says

    The default OPTION should always be NULL – meaning nothing – that why it is called an option (as in optional). That said Chris Elliott should call out internet shipping options, too. Whenever I go to Amazon, the “regular” PAID shipping option is already chosen for me while the FREE SHIPPING Option is not.

  • Nancy Marine Dickinson

    Purchasing anything online seems to be rife with these pre-checked boxes and it gets more confusing every day.

    I recently ordered something online (it wasn’t a plane ticket but an “As seen on TV” thing) and before I was done navigating the many, many pages of “But WAIT, there’s more!” this $10 item was now costing me $60 and there was no way to back out of it.  I tried disputing it with my CC company to now avail (You DID click the ‘Buy’ button…) and I got stuck for a great deal of additional money being sent to this, oh, let’s call them a ‘company’.

    Just as paper contracts have to make full disclosure, so should online purchases.  The worst time to realize a financial mistake is AFTER you hit ‘Send’.

    To expand on finance_Tony’s example – I’d much rather click a box to use the bathroom in-flight and choose to pay that $10 than to have it done for me and I didn’t KNOW it was done, thus charging me more money.

  • Chasmosaur

    I’m a usability and accessibility consultant, so for sites that want to inspire trust, the option boxes should always be unchecked and the language clear. (i.e. – it should be “I do not want this option.” vs. “I don’t want to not sign up for this option.” which is a common tactic.)

    However, many companies pull this kind of garbage, not just the travel industry.

  • http://flyicarusfly.com/ Fly, Icarus, Fly

    “We viewed pre-checking travel insurance as a service to our customers”…

    Really? Gee, thanks for thinking of me first! Sigh. I wonder how he could’ve said that with a straight face.

    I don’t understand why they can’t have both boxes unticked (“I want insurance” and “I do not want insurance”) but still force the user to tick one of them before going to the next screen. I see this a lot (ex. you have to tick “agree to terms and conditions” or whatever before the website will go to the next purchase step). That way, it’s fair. You’ve made your decision and if they, out of their magnanimity, want us to consider insurance, presto! we have…


  • Miami510

    3% Mooches
    As I read the voters response, it now stands at 97% who feel the “opt-out” type of selling is an assumptive technique that should be legally banned. 
    What surprises me is the 3% who want to chance being taken advantage of… or who want to be forced to be vigilant to constantly look for “tricks” in the market place.
    A “mooch,” in marketplace slang, is a potential customer waiting to be taken advantage of.  It is amazing that mooches collude in their own oppression by avarice of the market.

  • TonyA_says

    There is a legal reason why travel agents should offer and advice travel insurance to all their clients. They could be held liable for failure to do their Duty to Warn and Inform their customers if the airline goes bankrupt or cannot deliver the transportation. Please read Rodriguez v. Cardona Travel Bureau.

    Likewise, there
    was no testimony that the agent advised his principal of any way to
    avoid, or insure against the risks of contracting with a charter
    carrier, such as trip cancellation insurance, which is available at a
    nominal cost to cover such hazards. In this instance, defendant-agent
    did not suggest to plaintiff that such insurance was available.

    On the other hand, the agent was not held responsible for the failing airline by offering travel insurance. Please read MARKLAND v. TRAVEL TRAVEL SOUTHFIELD.

    On January 10, 1989, the Marklands received an invoice from Travel Travel in the amount of $6,548.00, which they promptly paid. Again, printed at the top of this invoice was the “customer disclosure notice.” Travel Travel stated at trial that a travel insurance application should have been included with this invoice. The Marklands stated they never received any such application. One week prior to the date of departure (March 1, 1989), Ted Markland obtained both the airline tickets and the travel vouchers from the travel agency, which were to be presented to the hotel in St. Croix. Included was the passenger itinerary, dated February 17, 1989, with the “customer disclosure notice” again printed at the top of the form. Also, Judy Katzenmeyer, the travel agent that booked the Marklands’ trip, testified at that time that she informed Ted Markland that Eastern was having financial problems. Her testimony in pertinent part was as follows:

    Q [Mr. Bopp] Okay. At that time, did you mention anything about travel insurance?

    A [Judy Katzenmeyer] Well, that’s where my memory differs from Ted because I do think Eastern was then having problems, and I think I said to Ted, “Are you sure you want to do this?” And I think he said, “Yes, we’ll take a chance”; but I’m not sure.

    Q But that’s your recollection?

    A That’s my recollection.
    In addition, the
    agent advised the principals, although in very small print, that they
    could protect themselves from loss by purchasing travel insurance…

    We conclude that Travel Travel, as a matter of law, was the agent of the Marklands. The agent acted reasonably and it did not neglect its duty of ordinary care. There was no evidence to support a finding of a breach of agency. Accordingly, Marklands’ point denied.

    Judgment affirmed.

    But there could be a silver lining for those who are cajoled into buying travel insurance. The traveler might actually need it whether he knows it or not. Maybe travel insurance should be mandatory to reduce the hidden subsidy tourists and travelers may be getting from public funded institutions.

    That said, OTA should not mistake their Duty to Warn & Inform as an opportunity to gouge the their customers. Did you notice that before you can checkout in an OTA site you will have to go through pages of hotel, car, cell card offers? You hope none of those boxes are already checked for you.

    BTW If you read Markland vs. Travel Travel you will understand that a travel agent is a BROKER (an agent) and not a prime contractor as one poster adamantly insisted they are in the previous posting about Cheaptickets and Air Europa.

  • Nigel Appleby

    If the companies want checked boxes – surely the best option would be to have an “opt-in” and an “opt-out” neither checked ina dvance but one must be checked before the customer can go to the next page/screen. That way the customer/purchaser has to make a decision all on their own. I have seen that on a few sites, usually phrased as a “do you want this?” click yes or no.

  • Sukhwinder Aujla

    If you find yourself paying for something you don’t want, it’s not enough to get your money back. Send an e-mail to the Department of Transportation, the Federal Trade Commission or your state insurance commissioner. Tell them what happened.
    Sac Taxi Cab

  • http://www.facebook.com/people/Roger-Barnett/1352435334 Roger Barnett

    Ryanair on its European ticketing sites does exactly that – you must check either an accept or a refuse box for travel insurance, and you may not ignore this step either.   The web site will send you back to check either positively or negatively.   Ryanair does the same for “do you wish to check luggage” – say yes or no, you cannot ignore it.  Given the aggressive style of Ryanair to sell extras, I can only believe that the European Union has required them to do this.

  • http://www.facebook.com/people/Roger-Barnett/1352435334 Roger Barnett

    See my reply concerning Ryanair above … yes it is a responsible practice, and could easily be adopted.  There is no trickery involved (and if there were you may be sure Ryanair would have used it).

  • finance_tony

    I don’t see it that way at all.  As I pointed out above, I’m all for the rule and transparency in general. 

    But what about an airline that breaks with the industry and charges, say $50 to print a boarding pass at the airport, if you can’t or don’t print it yourself?  They could put a $1 opt-in “boarding pass protection fee” on their website when you buy your ticket. 

    Now pretend on of Chris’s readers chose not to opt-in, printed her boarding pass at home, lost it, and then showed up at the airport and got socked with a $50 fee to re-print it.  Do you think that he’d get an angry e-mail?  I’d give 5-1 odds that he would.

    While the rule does more good than harm, in my opinion, when you couple it with unbundling things that have traditionally been included in a fare, you set yourself up for some big passenger disappointments.

  • http://pulse.yahoo.com/_YGKCVZZWG5X675MLVEAS6Z7CBI DesrtDrmr

    One of the worst things is that I realized I was getting tons of magazines I hadn’t ordered, and then being billed for renewing subscriptions a few months later.  I didn’t know where they were coming from until I started noticing the pre-checked boxes on ordering forms.  It truly should be illegal to have those things anywhere. 

  • 46Shasta19

    I certainly agree that pre- checked boxes are wrong, but I think it is important that people READ what they are purchasing.  So many, not only on line, but everywhere do not pay attention.

  • SoBeSparky

    Really bad advice to suggest consumers should buy travel insurance when there is no standard policy.  Every company, every airline, has a different product.  When the objective of an airline web site is to let a customer choose flights and buy a ticket in what seems to be less than 60 seconds, stopping the entire process to read the terms and conditions of a travel insurance policy is totally unrealistic.  

    Why does Christopher Elliott get complaints over the years about travel insurance?  Because in many circumstances the policy in question, after careful reading, does not cover the customer’s claim.  So the fact that a child went into the hospital back home is no reason to insure the cancellation of prepaid flights?  Or the excess baggage insurance covers only the depreciated value of items and not replacement, so the lost business suit (replaced at the destination) is only 1/8th covered, if you can find the receipts from six years ago.

    When state insurance commissioners require standardized policies so  an informed consumer can choose between carriers, then travel insurance can uniformly be recommended.  

  • Bill Armstrong

    You know, this is about selling travel insurance, not about whether you want a boarding pass or if they will let you use the bathroom or not.

    Since I have pretty good travel insurance with my credit card (and I have checked it out) then I next to never need to check the box for insurance.

    The boarding pass issue might be a separate one..but in my case, I don’t pay for boarding passes, I don’t pay baggage fees, and I don’t have to “uncheck” anything except the insurance.  I do think the insurance box should be unchecked by default.  It seems the overwhelming majority of other people who voted do too.

  • finance_tony

    Just to point out, the wording of the poll is actually “Should “pre-checked” boxes ever be used online?” and is not limited to insurance.  If it were the case, I’d 100% agree with you.  I’m pointing out that the blanket question that the poll asks could bite consumers at some point, if unbundling continues.

  • pauletteb

    Purchasing travel insurance is often a good idea; purchasing it from Travel Guard and its ilk is not. Better coverage is available elsewhere for far less money.

  • Shelley C. Miller

    Wow! Wake up call to online purchasers. Thanks for ringing the alarm.

  • Joe Farrell

    Hey – I have taken to doing a screen save of my submission forms for some things – many companies routinely = as in ALWAYS – capture your personal information and add it to their mailing list even IF you opt out.    I cannot tell you how many times that I have sent a screaming azzhole letter to the CEO of a company PROVING that they are committing an unfair trade practice by not honoring the consumers wishes and their own privacy policy.  

    I even had the legal department of one company want me to execute a release of claims when they discovered that their executives told them to have an opt – out button to comply with law and their privacy policy and the marketing people directed the IT staff to not activate the button.  I got that item I ordered for free that time – and the marketing guy who made that decision apparently was looking for work.  But then some people take their word more seriously than others. . . . we all know whats going on here. 

  • Joe Farrell

    Even though there is ZERO difference in shipping speed whether you check FREE or Standard!  

  • TonyA_says

    They say FREE Super Saver Shipping (5-8 business days) versus Standard Shipping (3-5 business days).But I think you are right. In reality there is ZERO difference in ACTUAL shipping speed. How much more slower can they get by using USPS.

  • Vineet Sharma

    Restaurant Brugge
    thanks 4 sharing this post with us

  • Steve_in_WI

    I recently booked plane tickets on united.com for the first time (I had only flown them on business before, which my company books) and I was astounded to find that after I selected my flight and entered payment information, I had to click through multiple pages of add-ons, all of which were preselected and I had to opt out of purchasing.

  • Lindabator

    Wow – you don’t have a clue, do you?  Travel Guard is one of the largest, and safest, companies to use – they offer 3rd party coverage we recommend OVER those policies from cruise/tour companies.  They also offer special policies for large sites as requested – not as comprehensive, I agree, but certainly not a baseless company that fails to cover its clients.  We use them all the time, and have had no problems with claims either.  So don’t assume just because a site offers them, that they are useless. 

  • Philip Brown

    Please see my comments about Travelocity & Spirit Air; in the forum about Code-sharing.
    Muchas gracias,
    Philip C. Brown

  • VanessaElizebeth

    This sounds like a great read.Thank you very much.

    Choose your Finance wisely