Let's be clear that the reports on the effects on travel insurance are extremely loosely stated and that the RBS/Directline spokeswoman did the insurance industry no favours with the rubbish statements she was reported to have made.
This lady is clearly another unthinking corporate yes person who will shortly be asked to fall on their sword I would suggest. What about passengers who unexpectedly have their flight diverted from Birmingham to T5 or whatever. Are they still not covered even though they could not have foreseen travelling through the Terminal when they effected the policy?
Surely the government itself will be leaning on the insurers over this issue as if RBS and co are allowed to get away with it then it effectively threatens total disaster for BA in particular and also to a lesser extent for the BAA. The appropriate response by insurers here is surely to raise premiums for travel insurance policies that include baggage cover sold to those living at postcodes within a so many mile radius of Heathrow airport.