Find out how you will get home and whether you'll be able to get your money back if the travel company you booked a holiday with goes bust.
It's a nightmare situation - you're starting to get excited about jetting off to somewhere exotic when suddenly you hear that your travel company has gone bust. Worse still, you're actually on holiday when the news breaks and fear that you'll be stranded abroad with no way of getting home.
However, before you start to despair, get out any holiday related paperwork you have and have a good read. Depending on how and where you booked you could be fully covered so there is still hope!
I booked a package holiday through a travel agent
If you booked a package holiday through a UK travel agent or tour operator you will be covered by ATOL protection. This means that:
- If you are abroad when your travel company goes bust alternative travel arrangements will be made for you.
- If you are abroad when the airline you were travelling with goes bust, your travel company will make alternative travel arrangements for you.
- If you haven't yet travelled and your travel company goes bust you will be able to claim a full refund from ATOL.
- If you haven't yet travelled and the airline you were travelling with goes bust your tour operator will offer a replacement holiday or a refund.
You can check whether your travel operator has ATOL protection on the CAA's (Civil Aviation Authority) website.
Package holidays are generally defined as those that comprise 2 or more components, for example a flight and a hotel. If you only booked flights with a travel agent the level of cover available to you will be slightly different.
I booked flights through a travel agent
If you booked just flights through a UK travel agent it is possible that you will be protected by the ATOL guarantee. Unfortunately, however, although many travel agent flight-only deals will be covered, not all are.
Your flights are likely to be covered if:
- You booked through an ATOL protected travel agent.
- You were given an official ATOL receipt when you paid.
Your flights may not be covered if:
- You did not book your flights through an ATOL protected travel agent.
- You were given an airline ticket or e-ticket instead of an ATOL receipt when you paid.
I booked on a third party website
If you did not book your holiday directly with a travel agent but instead went via a third party website you will need to check your paperwork to see whether you are covered either by the ATOL scheme or by a similar travel protection scheme. Other protection schemes include ABTA, AITO, PSA and TTA.
I booked flights directly with the airline
If you booked a scheduled flight directly with an airline that goes bust you won't be covered by one of the major travel protection schemes.
Unfortunately, this means that if you have not yet travelled you will lose your money and, if you are abroad when the news breaks, you will need to make alternative arrangements for your flight home. However, you may still be able to reclaim any money you have lost as there are several options worth investigating:
- If you paid for your flights by credit card:
If you paid by credit card you should be able to reclaim what you have lost from your credit card company. You will need to contact your credit card provider directly, inform them that you would like to place a claim under Section 75 of the consumer credit act and ask what the procedure is.
Providing your flights cost between £100 and £30,000 and you paid at least a deposit by credit card (even if you paid the remainder by some other means) you should be covered.
- If you paid for your flights by debit card:
This depends on what type of debit card you used. If you paid by Visa debit card you should be able to claim your money back via the Visa Chargeback scheme. However, if you paid with a MasterCard, Solo or Maestro debit card you don't have this protection.
- If you took out travel insurance:
There is a chance that you will be able to reclaim the cost of your flights from your travel insurance provider. However, this isn't a given as 'scheduled airline failure' isn't covered by all policies. As such you will need to read the ts and cs of your travel insurance policy carefully or contact your travel insurance provider to find out whether you have this protection and are able to claim.
What should I do now?
If you've double checked that you aren't covered by your travel insurance or ATOL protection (or protection from another travel scheme) and need to arrange your flights home it's worth bearing in mind that many airlines offer discounted 'repatriation' fares for individuals who have been stranded as a result of airline failure. These generally go on sale shortly after the news breaks and are available for a couple of weeks thereafter.
As such, if you're stuck abroad you should:
- Check the collapsed company's website for information.
- Call the collapsed company's helpline for advice.
- Find out which other airlines operate at the airport your flight was scheduled to leave from.
- Call each to see whether any discounted seats are available (you will need to pay for these flights outright).
- Book a flight home.
