http://travel.boston.com/columns/sen...hare_scam.html
Interesting fragment of a
Boston Globe article, pertinent to the present thread:
Mileage insurance?
On June 2 , Sensible Traveler focused on some options for protecting air miles during a period of airline instability, and suggested insurance from PrivilegeFlyer.com as a possible answer.
Andy Dhuey of Berkeley, Calif., contacted me shortly after that column appeared, raising questions about whether the Award Guard coverage was legitimate insurance and whether it would truly offer any protection if a big airline went under. He said he had been unable to get any information from the company.
I followed up with Privilegeflyer.com and was told Award Guard is not insurance. A representative said the company does not pay out cash claims, but allows its clients to use their "lost" frequent flier miles on other airlines. While Privilegeflyer has protected customers in past airline failures, the company's representative declined to discuss whether it could weather the failure of a big airline.
"Privilegeflyer is a privately held company with private backers who do not wish to be identified," the representative said. "If you wish to know more about the stability of our company, like so many other customers these days, I can tell you that this is our 13th year in business and we are not planning on going anywhere."