SIA removes automatic insurance feature for online bookings

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Experts say SIA's flip-flops are sign of the company trying to cope with business disruption

About a month after it reversed a decision to impose a credit card charge on some flight purchases, Singapore Airlines (SIA) has made a second U-turn, removing an online booking feature that automatically included travel insurance unless passengers opted out.

The airline said yesterday it continues to encourage customers to buy travel insurance to safeguard their travel plans, but it has "taken customer feedback into account" and decided to offer the coverage as an optional feature.

The Straits Times highlighted the automatic feature about two weeks ago, after it was alerted to it by a few unhappy customers, who said they noticed the payment only after they had booked their flights.

One said he was told by the airline to contact the insurance company for a refund.

The Consumers Association of Singapore (Case), which had criticised the automatic inclusion, said yesterday: "We conveyed our concerns to SIA on this two weeks ago, and we are glad it has taken our feedback and consumers' feedback on this issue and reversed the feature."

Case executive director Loy York Jiun stressed that businesses should be transparent in their pricing.

"Imposing additional options and charges on consumers, such as travel insurance, without their express consent (through opting in) is an unethical practice," he said.

While pleased with SIA's reversal, Case noted there are other airlines - such as SIA subsidiary Scoot and Jetstar Asia - that continue this practice.

"We strongly urge all airlines to avoid 'pre-ticking' of options for better transparency," said Mr Loy.

SIA's other flip-flop came about a month ago when it decided - just a day after announcing it - not to proceed with plans to impose a credit card fee on bookings made by some travellers departing from Singapore.

The charge - 1.3 per cent of the total fare amount, capped at $50 - was to apply to those who bought its cheapest Economy Lite tickets, the airline had said.

Marketing and aviation experts said SIA needs to be mindful of how its policies and actions could affect its reputation.

Even as the airline strives to cope with tough competition and falling profits, it must be careful not to hurt its image and branding when introducing new policies and initiatives, the experts said.

Singapore Management University's Assistant Professor Terence Fan, who specialises in transport, said: "They (SIA) are probably trying to see if there is any way at all to nudge travellers, especially those in economy cabin, to pay a bit more.

"In other words, they are trying all sorts of ways to see which ones stick and which ones don't... If things don't work, then make a U-turn. The potential uplift in revenue is too important to ignore."

Mr Shukor Yusof of Endau Analytics said: "The recent episodes reflect a certain degree of desperation on the part of an airline that is trying to cope with a huge disruption to its business. It is also almost as if SIA thinks it can do what it wants because it is still at the top."

The reality, though, is very different, he said, with rival premium carriers on a par with or even ahead of SIA, he said.

Reader George Lim, one of the customers who had written to ST, said: "I'm glad SIA listened. Unfortunately, sometimes they listen only after the bad publicity."