Financial Protection for Travelers
If travel agent goes bust, what happens? Your money may be protected if the agent has taken out appropriate financial security to cover flight inclusive holidays. Package organiser must provide security for refunds. Factors like whether travel agent acted only as retailer or organiser can impact protection available. Where agent sells package holidays, refund depends on actions of organisers. If agent made all parts of holiday and set price, they count as organiser and must protect customer funds. But if agent only put together flight and hotel as separate items for you to pay individually, less protection applies. Research before booking to check financial security travel agent has in place. ATOL scheme covers issues with flight inclusive trips bought from UK agents.
Travel Insurance Coverage
Does travel insurance cover your operator goes bust? Travel insurance is a valuable protection to have when you’re planning a trip. But be sure to read the fine print of your policy so you know what’s covered in the event that your travel plans go awry. No, travel insurance does not cover if the company goes bust. Scheduled Airline Failure Insurance provides cover for irrecoverable costs if your airline becomes insolvent before you travel and also additional costs to come home if the airline becomes insolvent whilst you are away.
Recourse When Airline Goes Bust
If airline goes bust, don’t panic. Depending on payment method, you may get money back. Comprehensive cover likely means claim money back. If purchased with Alternative Airlines and we get refund, we’ll refund you. Pay flights with credit card for protection. Truth in Lending Act means better chance at refund from defunct airline. Bank wants its money back more than debit refund. If airline busts before the trip, cancel, and get a refund. Or buy a new flight and still go. If the trip is within a month, buy a new flight fast as the price rises. If bust mid-trip, finish and fly home. Check if tour operator has ATOL protection. Package holidays with flights have ATOL cover for full refund if can’t go. If no other airline flies the route, book hotel or extra travel and pay for new arrangements yourself. ATOL covers packages with flights, some flight-only sales. Flights direct with airlines are not ATOL protected.