Downsides of illegal tour operators

While the CPUC, City Attorney, State Senators and Inspectors General try to figure out what to do and how to handle illegal tour operators in CA, this blog is to point out some obvious downsides of illegal tour operators.

Here are some issues to consider about illegal tour operators:

1. They don’t drug test themselves

2. They don’t need to do vehicle safety inspections. No oversight.

3. They don’t get real commercial insurance coverage.

To this concern, you are most likely not covered in the case of an accident when taking a tour with an illegal operator. The reason for this, is they are most likely trying to use their State Farm or Geico auto-policy for coverage. However, these policies explicitly do not allow for commercial coverage. Once they investigate that you paid for a tour, then your medical will not be covered. You will then try to get recompensed by the illegal operator, but that person most likely does not have money in the case you prevailed against them.

Protect yourself from illegal operators!

It’s easy. Avoid platforms like where they do everything in their power for their web users to be in the dark on who the actual tour operator name is. Simply, do not book an excursion of any kind from a company that will not give you the business name of the actual operator. We believe they are keeping us all in the dark, because they fear that you will search for the tour company name via a search engine and book the tour directly with the actual supplier which will devoid them of a commission from the operator, if you did this. Their survival depends on you being in the dark. If this is not true, then why would not give you the tour company name?

Should you worry about unvetted walking tours?

Yes. Unvetted walking tours could mean that you end up with a tour operator that refuses to get liability insurance. In case you get injured during the walking tour or go on a walking food tour and get sick then you are really needing travel medical insurance to cover yourself. Also, booking a tour with an unregistered business deprives the real businesses, walking tours or otherwise, a fair opportunity at your patronage.

Remember: Travel platforms appear to be okay with illegal operators on their networks.

Until local, state and federal regulators figure out what is going on, the online platforms will continue to avoid worrying about illegal operators because these platforms want to show a lot of variety to you, the consumer, to lead you into thinking that they have all of these secret offerings that you can’t find anywhere else. This maybe true, but really unsafe. Illegal operators save money in regulations, insurance premiums, state and local fees, safety inspection costs, and taxes. Given these issues, they can always undercut legitimate businesses and offer you more value and services. In the long run, this is the wrong way to go. Avoid illegal operators at all costs. Avoid travel platforms or OTA’s that have the tendency to allow illegal tour operators on their networks without serious vetting. It was found that AirBNB does a really good job vetting sightseeing businesses on their platforms. They use a company called “Evident” who does a forensic investigation into their tour suppliers. They also make lots of disclosures to the tour operators about doing tour work without proper licensure. It’s not all OTA’s that are the concern.

By Avoiding Illegal Operators when buying tours and transportation, you are…

…forcing these travel OTA’s to *only* work with and only host legal and legitimate tour operators on their platforms. State-licensed tour operators tend to pushback about the higher commissions these online OTA’s want. On the other hand, Illegal tour operators should accept any-and-all commission rates demanded by the OTA’s, because these travel platforms just put them on the world’s stage to operate –something they didn’t have hours before. In just a few hours their unlicensed illegal tour/excursion is now live on a very prominent travel website, hence, the illegal operators are not likely going to negotiate against themselves by fighting with the online OTA’s about the commission rates. Again, OTA’s try not to vet their operators so they can get more tour experiences at higher commission rates on their platforms.