The UK travel association has warned holidaymakers that they should think about taking out travel insurance when booking a trip, even though they are often covered by consumer protection measures.
Holidaymakers are often protected by a number of measures in case their tour operator goes out of business - but they should still think about travel insurance, according to ABTA, the travel association.
Freedom Direct collapsed this month, joining XL in the list of holiday companies which have failed as the recession has taken hold. The company has told customers who currently have a booking with Freedom Direct to contact the Civil Aviation Authority.
Frances Tuke, a spokesperson for ABTA, said that the collapse is "not that alarming" and that failures in the industry have been "steadying off" in the last two years.
Ms Tuke admitted that the collapse of XL was a "big failure", but suggested that an incident of this magnitude only happens "about once every ten years". Despite this, "it's very important for travellers to think about financial protection when they are booking a holiday", she added.
"There are regimes in place to protect [consumers], so it just requires a little bit of forward thinking and forward planning and asking an ABTA member what is covered," Ms Tuke explained. "Not everyone books a package holiday, and not all travel elements are necessarily and automatically covered, so you need to find out whether yours is."
