FMC seeks to improve cruise passenger protection

FMC seeks to improve cruise passenger protection    The U.S. Federal Maritime Commission voted last week to initiate a rulemaking to strengthen protections for cruise line customer deposits and prepayments, and to reduce financial responsibility requirements for small cruise lines.
   The FMC requires cruise lines to file evidence of financial responsibility to ensure that passengers will be able to obtain refunds if their cruises are cancelled.
   In a 3-to-2 vote, the commission decided to prepare a proposed rule to increase the maximum coverage requirement from $15 million to $30 million.
   The FMC’s Web site said cruise lines have provided coverage in several ways — with a surety bond underwritten by a surety acceptable to the Treasury Department, acceptable insurance, a guaranty underwritten by an acceptable guarantor, or an escrow account established in accordance with the terms of an escrow agreement approved by the commission.

Lidinsky

   The FMC said that it proposed the update to respond to inflation and the growth of the cruise industry since the current $15 million cap was set in 1990. The commission also directed the proposed rule should relieve smaller cruise lines by giving them credit for existing additional forms of financial protection.
   'I'm pleased that after 20 years of debate, we have taken this concrete step toward better protecting consumers while making our regulations fairer,” said FMC Chairman Richard A. Lidinsky Jr. “No passenger who has a cruise cancelled should lose his or her deposit or prepayment. The commission looks forward to input from the public and cruise industry as we shape these updates to our passenger protections.'