Lucas
Have you ever heard about no win no fee flight claims companies? If not, then you have a great opportunity to know more as today I’m going to interview Ms. Koziarz from Airhelp – no win no fee flight compensation management company.
I came across Airhelp for the first time in 2018 when I handed my complaint against Lufthansa to them. In fact, Lufthansa rejected this complaint a year earlier so I had not much hope that Airhelp will succeed. To my great surprise, Airhelp regained my money quickly – I described the whole process with details in my article on how I got compensation for a delayed flight.
Since then a lot of questions arose in my head regarding no win no fee flight compensation business. Luckily, Ms. Marta Koziarz, AirHelp’s spokesperson for the polish market agreed for an interview and I have a chance to know more about this business:
No Win No Fee Flight Compensation
– Airhelp works in a no win no fee business model, could you explain what does it mean?
“No win, no fee” is a business model that allows consumers access to our legal expertise at no financial risk to themselves. We think it is only fair that air travelers who have their flight delayed or canceled only pay for our service if we win their rightful compensation with their valid claim. We want to ensure each and every claim processed has a positive result for the consumer. With this model, the claims that are valid are processed and we inform those with claims that are not eligible early in the process.
– Why is it worth to hand over the claim to you instead of file the claim on my own?
First, we take the paperwork away from people and run claims through our AI-geared evaluating system to make sure your flight is eligible for compensation. Second, we cross-check it with our robust flight database to verify the evaluation. Third, we have a strong legal team ready to stand up and go to court to protect passenger’s rights if needed. AirHelp offers a comprehensive package of services that can best process a claim for passengers. The process is quick, easy, and painless, handled by the expert in the field.
We have made people’s lives much easier, by facilitating the complicated filing process with AI and taking up possible legal actions for them. What is even better? All these advantages are made widely accessible based on the “No win, no fee” model! For people who want to assert their rights but are too busy to deal with endless documents, or too intimidated to stand up against big corporates, AirHelp’s service sheds the red-taped burden as well as a financial risk for them.
Just like you can cut your hair by yourself, but hairdressers can perform professional haircuts in an efficient way. AirHelp exists for the reason to provide professional claim services for passengers and help them get what they are legally entitled to.
– What is the passenger’s fee to represent his claim by you in front of the airline?
Our claim eligibility check and air passenger rights’ education services are all free. For the processing of claims, we use fixed fees that depend on the type of claim. The fixed fee frequently corresponds to around 25% of the potential compensation. For more detail, all the prices are on our website.
… The fixed fee frequently corresponds to around 25% of the potential compensation …
– Could you tell us a little more about the beginnings of Airhelp? How did you come up with the idea for the business?
It all started when AirHelp’s founders, Henrik Zillmer, and his two best friends, had tried multiple times to file for compensation but had found it time-consuming and difficult. It did not take long for them to realize that most airlines either reject compensation claims without providing a reason or fail to respond to complaints. Knowing they were not the only people exasperated by the process, they founded AirHelp as the solution to this problem. Eventually, it turned out that every year, more than 10 million passengers are entitled to receive flight disruption compensation, but we found out from the study conducted by YouGov on behalf of AirHelp that 87% of travelers worldwide do not even know their rights! There is still a lot of work to be done by us.
… Eventually, it turned out that every year, more than 10 million passengers are entitled to receive flight disruption compensation, but we found out from the study conducted by YouGov on behalf of AirHelp that 87% of travelers worldwide do not even know their rights! …
– Base on my research, you seem to be one of the biggest players on the market and certainly one of the most trusted (9,2/10 Trustpilot from ~25 000 customers reviews). Is the no win no fee flight claims companies market a competitive one? How strong is your position?
AirHelp is the world’s largest organization specializing in air passenger rights, helping travelers get compensation for delayed or canceled flights and in instances of denied boarding. We also take legal and political action to support the growth and enforcement of air passenger rights worldwide, which results in as much as three times more jurisdictions than our closest competitor.
To further help out global travelers, we are also the first one to launch an annual ranking of airlines and airports for passenger’s convenience. The AirHelp Score is a robust ranking that takes punctuality, service’s quality, and claim processing of airlines into the measurement. It serves travelers as a compass when they are booking their flights hence.
We stand firmly on the leading position in the market. How satisfied our customers are with our services, the evidence speaks for itself: they scored us the highest in comparison to our global competitors on Trustpilot review.
– If we take the data just from the last week (week 15) – according flightstats.com there were 10 846 delayed flights and 135 917 canceled worldwide and 981 canceled, 29 723 delayed flights just in Europe yesterday. This means that thousands of passengers can file a claim. Are you able to estimate how many of them are entitled to remuneration from the airline?
Yes, we are able to. For the single week 15 of this year in Europe, there were already 95,000 passengers entitled to compensation because of flight disruptions; and from the beginning of this year to week 15, there were almost 2 million eligible passengers! The worst aspect of it is, due to the fact that only 13% of travelers worldwide are aware of their rights, meaning most passengers are going to have their loss uncompensated.
… from the beginning of this year to week 15, there were almost 2 million eligible passengers! …
– Could you share with us some figures like your success rate, market share, etc?
We are a private company and do not share strategic information such as success rate or market share. However, we can tell you that AirHelp has the best reputation and the most successful experience to fight for passengers’ rights from an extremely advantageous position. So far we have already helped 10 million passengers from all over the world.
– And what about the execution of these compensations? Are all airlines willing to pay the awarded compensation to passengers?
We are now witnessing the explosive growth of traveler numbers on one side of the tourism industry, and low airline’s capacity to catch up with the increasing passenger number on another side. As the consequence of insufficient aircraft and crew to meet the traveler’s demand, flight disruptions peak at a record rate every year. To add to the problem, 87% of travelers worldwide are not aware of their rights when faced with flight disruption!
This knowledge gap thus causes many air travelers to miss out on their compensation. According to our study, around 45% of valid claims are wrongfully rejected by airlines. For a few airlines, such as Ryanair, AirHelp even had to re-open 95% of wrongfully-rejected claims; and Lufthansa, with which you experienced wrongful rejection, initially rejects 51% of valid claims submitted by AirHelp.
… According to our study, around 45% of valid claims are wrongfully rejected by airlines …
Unfortunately, many airlines apply these stalling tactics because they know that people are not aware of their rights and because only very few people would risk going through a legal process. By ignoring or rejecting compensation, many airlines can get away from the responsibility of compensating disrupted passengers.
– I know you do measure the airlines’ performance in this “compensation payment” area and rank them. What is the difference between the best and the worst airline? Could you present some statistics?
In order to help passengers with booking a perfect itinerary, we launch AirHelp Score ranking annually to measure how well an airline or an airport performs based on a comprehensive set of factors. Among all factors we took in for measurement, one factor is claim processing. To determine how an airline performs when it comes to its claim processing, we consider whether an airline ignores or wrongfully rejects claims, the time an airline takes to acknowledge and process claims, and the time an airline takes to pay out the compensation after it approves claims.
From this year’s AirHelp score, we can see that some airlines such as SAS and American Airlines score above 8 with their excellent claim processing procedures; while Easyjet and Ryanair are among the worst airlines hovering between score 1 to 3 with poor claim processing procedures. From the overall score we can spot an obvious trend––those airlines who handle the claim process well would likely to have a higher ranking. For example, both SAS and American are among the top 5; also, you can hardly find any other airlines among the top 10 to have a claim processing score below 7.
… SAS and American Airlines score above 8 with their excellent claim processing procedures while Easyjet and Ryanair are among the worst airlines hovering between score 1 to 3 with poor claim processing procedures …
– Could you share with us the most common airlines’ tricks to avoid paying the compensation?
Some common tricks include hidden compensation policies on websites, wrongful rejection of claims, and delayed payment. Basically these are tricks that fool passengers into thinking they are not eligible for compensation, or that make claim process extremely hard for passengers. Very often, airlines also blame “bad weather” for their flight problems, which would waive airline’s responsibility to compensate passengers; while in reality, flight disruptions might happen because of technical problems with the aircraft, which lay completely under airline’s responsibility to pay up. Since the majority of passengers are not able to evaluate what is the real reason that causes flight delays, they usually fall for airlines’ tricks.
– How long on average does it take to get the money back from the airline?
AirHelp strives to make the process as smooth as possible on behalf of passengers. Once the payment has been received by the airline, it is sent to customers very quickly. The time to receive a response from the airline, however, varies depending on their capacity to handle claims in a timely manner. Some airlines reply within weeks, others we will need months. In some occasions, the case may be brought to court, which will have a large influence on the time it takes to receive compensation.
– How did your business change since 2013? Is it more difficult now than in 2013?
We have grown from three founders to a company with more than 600 employees that have already helped more than 10 million air travelers. Throughout these years our business has definitely changed significantly––we have changed from a small scale company to a much larger one with a much broader perspective.
In the beginning, we had a very hard time. We tried to enter an industry that was used to play only by the airlines’ rules. Most airlines simply ignored us, passengers did not know us. What was even harder, they did not even know they had rights! We actually got our very first customers by buying super cheap flight tickets just to get to the gates, and proactively talked to delayed passengers and explained to them their rights. We saw the huge potential and worked really hard, thus our reputation and team grew very quickly. Today we are an established industry leader, respected for our expertise and knowledge. We are always open to maintaining a dialogue with all important stakeholders – passengers and airlines – in order to make claims processing as widely accessible as possible for everybody involved.
… In the beginning, we had a very hard time. We tried to enter an industry that was used to play only by the airlines’ rules. Most airlines simply ignored us, passengers did not know us …
– In January 2019, one of Lufthansa’s top managers said that the company spent 500 million euros ($573 million) on compensating passengers for flight delays and cancellations last year. Just after, Lufthansa announced that there will be an extension in the executive board – they will create a position dedicated to improving operational stability and quality in the Lufthansa group. Do you think this will impact your business?
We are happy to see airlines as well as air travelers paying more attention to the problem of flight disruption. Nowadays many more airlines start to understand that they need to put passengers first in order to keep a strong market position in the future. There is so much competition out there, especially with all the low-cost carriers, which led to “treating your passengers well” and holding yourself accountable for your own operational mistakes being a comparative advantage! Consumers tend to not only look at ticket prices anymore, but they also are better educated today and they are more willing to speak up for their rights than in the past – Lufthansa seems to have grasped this.
In the long term, AirHelp will continue to push airlines to provide seamless claim process for passengers. We hope not only Lufthansa but also all the other airlines, can make the claim process as customer-friendly and easy as possible. Since AirHelp and airlines are striving for the same goal, which is to provide a smooth travel experience for passengers and an efficient claim process, we will keep fostering a good working relationship with airlines.
– If airlines could manage to improve their on-time performance to 90% (the current industry average is ~75%), how this would impact your business?
When one day all airlines are able to provide punctual flights, as well as fair and efficient claims processing, then AirHelp has achieved its ultimate mission.
However, we need to point out that this is a too rosy imagination to be true. According to IATA’s study, the tourism industry is exploding and will not slow down in the near future. At the same time, airlines have not caught up with the growing speed by recruiting enough pilots and providing sufficient flights. This has resulted in more cancellations and strikes, as you may have already noticed on this year’s news so far. As air travel continues to boom, there will always be factors causing flight disruptions: from boarding each passenger on-time to checking in each piece of luggage, from buying enough planes to ensuring each aircraft’s safety, from recruiting enough staff to assuring their basic labor rights, and many more.
… According to IATA’s study, the tourism industry is exploding and will not slow down in the near future. At the same time, airlines have not caught up with the growing speed by recruiting enough pilots and providing sufficient flights …
So the question is not if one day there will be no more disruptions because there will always be. The question is whether airlines would play by the rules and compensate passengers for those disruptions that airlines could have avoided. To fulfill our mission, we not only help passengers by educating them and handling their claims professionally, but we also help airlines by decreasing their workload as we always send them perfectly prepared and pre-checked claims.
– Law regulations in Europe tend to change from year to year. Do you think it is possible that someday, airlines lobby will push the EU parliament strong enough to give up the regulation EC261/2004?
The EU law has stayed the same all these years, and it is actually perceived as the golden standard of consumer protection worldwide, with the proof of it being benchmarked by several other countries across the world, Canada being the latest example.
There are no major changes to it. What might sometimes be perceived as changes to the law are often court decisions to fill in the gap between the theory and practice, clarifying further how the law should be interpreted and implemented. Court decisions are common practice to complement a law-based system. The European Court of Justice (ECJ) has done a great job of clarifying the EC261 interpretation in the last decade. For example, last April ECJ clarified that all airline strikes are the airlines’ responsibility and flight disruptions caused by strikes are therefore eligible for compensation. The decision from the highest court does not alter the law itself but helps strengthen the law by clearing out grey zones and vague rhetoric.
… last April ECJ clarified that all airline strikes are the airlines’ responsibility and flight disruptions caused by strikes are therefore eligible for compensation …
Given the past record of airlines being willing to take cases to courts and hiring expensive law firms instead of paying for passenger’s entitled compensation, we assume some airlines would take all means to reject a payment even when passengers are entitled to compensation according to the regulations. This, unfortunately, includes their tireless political lobby to bring down legal protection of EU passengers.
However, we should not worry too much about it. EU recently just reiterated the importance of EC261’s function to protect European air passenger’s rights in their latest European Court of Auditors (ECA) report. AirHelp is confident that the golden EU legal protection would stand firm and unbreakable in the coming decades. To ensure such legal protection as well as to give passengers a strong representation in the EU, we also founded the Association of Passenger Rights Advocates (APRA) based in Brussels.
– At the end, I’d like to ask you for your plans for the future?
We will continue to grow in our positioning as a cutting edge company fighting for passengers’ rights. By engaging with our consumers through truly innovative new features, we will build on our successful service and help more and more passengers fight for their rights. We will also keep expanding our services for those out of the EU. Recently we have just started promoting our no win no fee flight compensation services in Canada, Brazil, and Israel to help travelers in more countries. Look out for the coming innovative features that will make the experience of claiming for compensation much easier for air travelers!
– Thank you for your time. I wish you a lot of success and further development of your company.
Final Words
Ok, that was a nice pack of information about this interesting business, I really enjoyed this discussion. If you need some more information about flight claim management companies market, read my article about benchmarking the flight claim companies.
This is the first interview on my blog but for sure not the last one. Sign up for my newsletter to be informed about the next interviews. In the meanwhile, share this if you liked and thanks for reading.
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