A news station in Bradenton Florida is reporting on an interesting story of a Princess Cruises customer, Mr. Welt, who booked a 12-day cruise called the "China and Japan Explorer." The cruise ship was scheduled to sail from Shanghai with three stops in Japan.
But then the earthquake and tsunami hit Japan. Mr. Welt was initially undeterred, but he became greatly concerned as the damaged Fukushima nuclear power plant leaked radiation and he read a warning by the State Department against travel to Japan.
Mr. Welt reportedly expressed his concerns to Princess, but was told that the cruise was proceeding as scheduled. A few days later, he canceled the cruise because he didn’t want to risk exposure to radiation. Two days later, Princess canceled all three stops in Japan, and added ports in China.
Mr. Welt thought that he could obtain a refund or get a voucher for another Princess cruise. Instead, Princess charged him a $2,398 cancellation fee which was 100% price for the cruise.
A company spokesperson, Karen Candy, claims that there are no records indicating that Mr. Welt ever called the cruise line. Ms. Candy told the news station that Princess would have tried to re-book Mr. Welt but because he did not purchase trip insurance he was out of luck.
I looked at the terms and conditions of Princess’ "Passage Contract," and it does not mention the issue of what happens when radiation poses a health risk in a particular port. The contract states that the cruise line may "change, cancel or terminate" the cruise because of “trouble spots” in the world in terms of "war, terrorism, crime, Act of God, civil commotions, labor trouble, and/or other potential sources of harm. Local conditions and infrastructure may also create hazards to passengers while off the ship." However, this pertains to the cruise lines’ right to change or cancel the cruise – not the right of the passenger to do so.
A passenger’s best argument appears to be found the latter part of paragraph three (Notice Concerning Safety and Security). The cruise line states:
"Carrier reminds all Passengers that they must ultimately assume responsibility for their actions while ashore. The United States Department of State and other similar government agencies regularly issue advisories and warnings to travelers giving details of local conditions in specified cities and countries according to such agency’s perception of risks to travelers. Carrier strongly recommends that Passengers and their travel agents obtain and consider such information when making travel decisions."
Of course, this is exactly what Mr. Welt did. He assumed responsibility for his health posed by the damaged nuclear reactor and prudently considered the warning issued by the State Department in making his travel decision. He did what the contract drafted by Princess’ lawyers told him to do. Yet, the cruise line penalized him with the entire cruise fare?
How would a judge or arbitrator rule? Who knows. I’m sure that Princess will be pleased to pay one of its defense firms $10,000 to $20,000 to argue that Mr. Welt should have purchased insurance (what we recommend for all passengers) and fight Mr. Welt tooth and nail to keep him from recovering his $2,398.
But what about the larger issue of customer service and the cruise line’s reputation?
The article indicates that Princess has a "F" rating with the Better Business Bureau ("BBB"). Yes, its true. The BBB indeed rated Princess a "F," finding that out of the 134 complaints lodged against the cruise line, on 80 occasions the cruise line refused to make any adjustments or simply never responded to the customer’s complaint.
Unlike the uncertainty of a legal decision any particular judge may make whether a customer can or cannot cancel a cruise because of a radiation leak, Princess Cruises’ reputation is completely within the cruise line’s control. The airline and hotels were pleased to accommodate Mr. Welt, but not Princess.
We have seen Princess and other cruise lines take this penny-wise-and-pound-foolish approach before. Yes, they can take a hard line approach and keep their customer’s money most of the time. But they risk trashing their reputations in an industry which suffers from a poor reputation in the first place. Take a minute and read: And The Cruise Industry Wonders Why It Has An Image Problem . . . (involving Princess, Carnival and Royal Caribbean) as well as And The Cruise Industry Wonders Why It Has An Image Problem . . . (continued) (NCL).
The bottom line here is that the customer did what his cruise contract required him to do. He made his travel decision based on the State Department warning. In return, Princess Cruises kept all of a customer’s money who didn’t go on a cruise scheduled to stop at a country with a nuclear reactor emitting dangerous levels of radiation.
Princess should have at least donated the money to a relief organization in Japan.
I’d say Princess’ BBB grade of "F" is well deserved.