Updated on 19 May 2015.
With the summer having finally arrived and the temperatures edging upwards, you may well be planning your dream getaway in the sun. But, as recent events have shown, any number of things might go wrong - from cabin crew strikes and airlines going bust to freak 'acts of nature' that stop you from jetting off.
Arguably it's now more important than ever to make sure your holiday is protected against the unforeseen so that if things don't quite go according to plan, you won't be left out of pocket.
Most (although not all!) travel agents and tour operators are signed up to a scheme that protects your travel plans when you book a package holiday. However, you are unlikely to find any such protection if you book your flights, accommodation, onward travel and so on separately.
Most travel agents are registered members of either the Association of British Travel Agents or the Association of Independent Tour Operators (AITO). This means they must give you a certain amount of financial protection against the unexpected when you book a package holiday with them.
A package holiday is one that involves two or more elements of a holiday, such as your hotel and your flight booked together, at the same time, through the same operator. As of 30th April, 2012, ATOL protection was extended to include flights sold with either accommodation, car hire, or both (known as flight-plus holidays) even if they were booked at different times.
All package and flight-plus holidays which include flights booked through a travel agent should be covered by ATOL (Air Travel Organisers' Licensing) protection, but you should still take it upon yourself to check.
ATOL primarily exists to provide refunds, arrange for people to finish their holidays, and offer repatriation to those who have been stranded as a result of an airline or travel agent failing. This protection comes as standard as part of the agent's license, at no extra cost to you.
Many agents will also offer to provide a replacement holiday of equal value to your booked package holiday if the airline collapses before you are due to go, or if you cannot travel due to acts of nature or political unrest.
You can't take this extra protection as a given, however, and should double check what protection your agent has in place before you confirm your booking.
A major part of the ATOL reform in April, 2012, was to make the license and its protection for customers obligatory for all firms, whether acting as a travel agent (see above) or as the provider of your holiday, e.g. flight plus car hire booked through the airline or a third party.
This means that flight-plus packages booked through the same provider must legally be covered with ATOL protection, even if individual elements are booked at different times. However, if your travel organiser refers you to an external website to book your car hire, for example, your booking is not considered a flight-plus package.
As long as your flight, accommodation and/or car hire are booked within 24 hours of each other it doesn't even matter which is booked first, although trips must be over 24 hours in duration or include an overnight stay. Other elements that form a significant part of your holiday are also covered by the provider's ATOL protection, provided these initial flight-plus criteria are met.
If you decide to arrange your holiday yourself and book your flights and accommodation separately (for example, flights booked directly online and a hotel stay booked directly over the phone), your holiday won't be covered by ATOL or ABTA protection. But this doesn't mean you can't protect yourself regardless.
Fortunately due to EU legislation introduced over the last few years, you're entitled to a refund or alternative transport to your destination if your flights are cancelled or significantly delayed. This however only applies to flights that set off from or land at an EU airport on an EU carrier. You should also be entitled to free meals and refreshments if you have been stranded somewhere whilst waiting for a delayed flight.
If you're flying with an airline that isn't EU-regulated and isn't taking off or landing within the EU, you'll have to look to other forms of protection such as travel insurance.
It's important to realise that this refund/alternative travel EU flight guarantee doesn't extend to accommodation, onward travel plans and any other bookings you've made for your holiday. This could cause problems if a cancelled flight stops you from getting to accommodation that you've paid for.
When you book standalone accommodation (or any other holiday add-ons) it's a good idea to check whether you'll be able to move your booking at short notice without penalty should the need arrise. If this isn't possible then you'll need to look at taking out travel insurance so that you don't get left out of pocket should something go wrong with your travel plans.
Imagine you arrive finally at your holiday resort or hotel, and it doesn't measure up even remotely to how it was described to you when you booked it. Not only would you be disappointed, you would feel left out of pocket having paid for something you don't feel measures up to that value.
However luckily you can claim for compensation from your travel agent or whoever you booked the accommodation through if it isn't 'as described'. First, your accommodation provider must offer you a suitable alternative. If this isn't available, you can claim for a full refund and to be flown home.
Compensation can usually be claimed for loss of enjoyment, inconvenience, and disappointment, as well as the loss of value between what you booked and what you have ended up with.
You can also impose a level of your own protection on your flights or accommodation by booking them with your credit card. If the flight or hotel costs more than £100 you'll benefit from Section 75 protection which will mean your credit card provider accepts liability if your flight or hotel lets you down.
However there are specific rules that govern when exactly your credit card provider will pay out; for example it will only pay out if your flight or accommodation provider is the party at fault. So it is unlikely to pay out for accommodation that you are unable to reach because of cancellation or delays of your flights.
Arranging travel insurance is always essential when going on holiday, even if your holiday does benefit from ATOL or ABTA protection.
Events of the last few months have really highlighted the need to be savvy about buying travel insurance as many have been caught out after opting for the cheapest cover possible without checking the details.
In fact shopping for travel insurance calls for the same level of scrutiny and thought that goes into buying any other kind of financial product, because this could mean the difference between you going on holiday and having to stay at home.
Looking for the following elements of cover when you're shopping around for travel insurance will help you to protect your holiday should the worst happen:
Scheduled airline failure
When you're planning on going on holiday and you don't have ATOL protection, you'd be well advised to put your own form of protection against airline failure in place. Some travel insurance providers offer 'scheduled airline failure' as standard but this is by no means applicable to all insurers, so check the small print of a policy before you buy.
You can use our travel insurance comparison tables and Advanced search to find policies that provide this as standard.
Standalone airline failure insurance
Alternatively, you can purchase flight protection separately through a dedicated provider such as ProtectMyHoliday.com - although remember to compare the cost of travel insurance that includes this as standard with travel insurance plus separate airline protection to see which offers better value for money before you make your decision.
If you're only flying within the EU or leaving/landing at an EU airport, you may not need to take out standalone airline failure insurance as EU regulations mean that you must be given compensation if a flight can't go ahead due to the fault of the airline.
However it may not be sensible to rely on this alone and so it is worth checking exactly how you might covered if you are flying in the EU by checking out your rights.
As well as cancellation and delay caused by a travel company or airline going bust, you might find your trip being put on hold or called off altogether because of strike action, a natural catastrophe, or a breakdown of your plane, train, coach, or bus.
As such it's important to look at the small print of a travel insurance policy that seems suitable before you buy to check what they offer in terms of cover for cancellation and delay, and if so, under what exact circumstances it will come into force.
You should also look for useful features included in your travel insurance such as cover if you miss your flight through no fault of your own (often called 'missed departure').
It's incredibly important not to leave buying your travel insurance to the last minute, and instead to book it the moment you have booked and arranged your holiday.
This is because most insurers will not cover you for events that are already underway when you buy your travel insurance. For example, if you take out travel insurance after a strike that will affect your travel plans has been announced, your insurer is unlikely to pay out.
If you're not sure whether your policy will cover an event that is already in progress or perhaps only rumoured, check the terms and conditions plus the named exclusions in our travel insurance comparison tables very carefully before you buy so that you're sure.
Generally speaking, buying travel insurance is about much more than simply making sure you are covered for possible medical expenses or for a situation where you lose your cash or passport.
Looking carefully at how your holiday might be covered against airlines going bust or any other circumstance that might mean you can no longer go on your holiday is key - and will mean that even without booking through a travel agent you'll get quality travel insurance that covers you comprehensively.
Written by Sally at money.co.uk
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