In February 2019, the strike organized by China Airlines pilots resulted in more than 60 canceled flights. A total of 30,000 passengers were affected in this seven-day strike action over working conditions and benefits as more than 60 flights were canceled.
In mid-February of 2019, striking pilots of China Airlines agreed to return to work immediately after reaching a consensus deal with the Taoyuan Union of Pilots. China Airlines has offered a compensation scheme to passengers affected by flight delays and cancellations. For flights delayed 6 hours or more including connecting flights due to canceled flights, China Airlines has promised to cover accommodation, food, and transportation expenses incurred by the change of the itinerary. However, passengers must submit their boarding passes or related invoices/ receipts for China Airlines to review these documents and handle each claim with discretion.
Apart from airlines’ compensation, some passengers have the tendency to buy travel insurance, including travel inconvenience insurance. They can also receive compensation from insurers. Because of strike or weather conditions, insurers often offer compensation for flight delays, cancellations, changes, or reductions. Passengers then have to go through a complicated claim settlement process by providing related evidence and/or documents. When flights are delayed or canceled, they need to request proof from airlines, provide their boarding passes, and fill in documents. Normally, it takes about one to two weeks to complete a claim settlement process. Therefore, how to simplify the travel insurance claim settlement processes has become an important issue for insurers.
This is the process flow for existing travel inconvenience insurance
#1 Customer goes to buy insurance at the counter
#2 Flight gets delayed
#3 Obtain claim application, Proof of delay, Boarding Pass
#4 File Submission / Rejection
#5 Claim settlement after investigation.
Blockchain can speed up the above travel inconvenience insurance process
A blockchain-based solution that can integrate flight information has been applied to automate travel inconvenience insurance processes and reduce claim settlement time by simplifying insurance application and claim settlement processes. Once specified conditions are met, the solution will send a claim notification to the insured automatically and the compensation will be paid into the insured’s designated account through the solution’s autonomous claim payout system. The insured no longer needs to request documentation of proof from the airline in case of flight delays. The streamlined and automated insurance process will reduce the operational cost of the insurer, encourage passengers to buy travel insurance policies, and increase business opportunities for travel insurance companies, or insurers.