Booking cancellations and consequent loss of income due to the drought are not covered by insurance, says SATIB’s Cecily Melia. She advises the best way to manage this risk is to communicate honestly with your agents abroad so that clients understand the situation and, hopefully, don’t cancel.
An industry sector that appears particularly vulnerable in this regard is that of the tourist guides. Institute of Professional Tourist Guides SA chairman, Johan van Biljon, says tourist guides cannot insure against cancellations or loss of income, and tour operators often take advantage of this. “They book you for a tour for three weeks next year and you turn down other work as you are booked. Good tour operators will give you 30 days’ notice to confirm the tour details or cancel, but most leave it until a week before the tour starts. This is a very unfair practice, but it happens fairly often.”
He says: “We always advocate that tourist guides sign a contract, which must include a clause for last-minute cancellation. However, most tourist guides are freelance. Very few sign contracts with tour operators. A lot of tours get cancelled, for example when not enough seats have been sold. Guides (especially language guides) are often booked years in advance to secure a tour but can be cancelled at any time. So very few tour operators are prepared to sign contracts that far in advance and only if they are 100% sure that a tour will depart and, even then, there is mostly no cancellation clause in the contract. So, tourist guides are left without recourse when a tour is cancelled.
“It is part of the tourist guides’ work to plan and accept these types of cancellations, as they occur all the time. In addition, one can understand that tours get cancelled due to the water situation and that must just be accepted. However, the sad thing is that some tour operators use the situation as an excuse to cancel a guide and then give the tour to another preferred guide. This practice is totally uncalled for,” he says.
Meanwhile, there also appears to be no insurance cover for additional costs and expenses in keeping one’s business operating during a drought. Laying off staff or importing water to keep pools filled and leisure facilities open can be expensive. “Whilst SATIB is not aware of any coverage currently available in the market, this is an aspect that we are exploring with a view to providing cover in the future,” Melia says.