With thousands of people left stranded by this year’s collapse of Lowcost Holidays, get up to date on what your rights are. In the event of a flight cancellation due to the airline or travel company going bust, learn how to react and what you can do to protect yourself.
Photo by: nmcandre/Fotolia
What happens if I paid for my flight direct with the airline with a credit card?
If the airline your flight is with has gone bust and you paid by a credit card, then you are automatically protected under Section 75 of the Consumer Act 1974. The flight must have a value over £100 and less than £30,000. You would need to contact your credit card provider to claim back the costs for the cancelled flights. Retain proof of purchase.
What if I pay for my flight direct with the airline with a debit card?
Certain debit card providers may offer “chargeback”. Visa, Maestro, Mastercard and American Express are among these. A chargeback is a refund applied where goods have been damaged or services were not delivered. Retaining proof of purchase is essential. Check with your debit card provider what they would cover.
Ironically, if your purchase took you into your overdraft, you bought the flight on credit and therefore may be covered by Section 75 mentioned above.
My flight will cost less than £100- will this be protected?
This wouldn’t invoke your rights under Section 75 but your card provider may cover this as standard. Check with them before purchasing if you are unsure.
I booked my flight through an agent.
Always book where you are protected by ATOL. ATOL stands for Air Travel Organiser’s License and this is regulated by the Civil Aviation Authority (CAA). This is a financial protection scheme for package holidays and charter flights sold by tour operators in the UK.
Not all flight-only deals booked through an agent will be ATOL protected. Check before you book.
Package holidays sold through an agent in the UK should have ATOL protection. Accommodation booked at the same time through the same agent will also be ATOL protected if your holiday can no longer go ahead.
You can check whether a travel company is registered for ATOL-protection here.
You can find out more information on making a ATOL claim here.
If your holiday is not flight-based, but is land- or sea-based, and so involves a journey by train, coach, or cruise, cancelled bookings through an agent may be protected by the Association of British Travel Agents (ABTA). Check if the agent is registered with ABTA before booking.
Photo by: Patryk Kosmider/Fotolia
Will my travel insurance cover cancelled flights as a result of the travel company going bust?
This is rarely covered by basic policies. If it is, it may be listed under ‘supplier failure’. You’re more likely to be covered for this with insurance for a package holiday but it’s not guaranteed. Get travel insurance that includes Scheduled Airline Failure Insurance (SAFI). This will cost more money so weigh up the costs against the likelihood of your flight being cancelled. Check that the airline you’re travelling with is covered by SAFI.
What if I’m abroad and my return flight is cancelled by the travel company going bust?
You will need to pay for a new return flight home with an alternative airline. However, the cost of your original flight may be covered by Section 75 if you paid on a credit card, by ATOL protection, or by your travel insurance.
Top tips before booking flights
- Pay on a credit card if possible. Discuss with your card provider (credit or debit) before booking whether your flight costs are covered in the event of the airline going bust.
- Take out a travel insurance policy that includes Scheduled Airline Failure Insurance (SAFI). You should consider an annual travel insurance policy if you’re a frequent traveller, or start your travel insurance from the moment you book your holiday so that you’re covered for cancellations beyond airlines going bust.
- Check that the flight and/or agent has ATOL protection and get proof of this upon booking.
- Be aware of whether the travel agent or tour operator is a member of the Association of British Travel Agents (ABTA). You can search for ABTA members here.
- Should you have any difficulty in making a claim through your travel provider, call the Financial Ombudsman Service on 0800 023 4567.
- If protection is in place for your holiday, retain all relevant paperwork.
- Familiarise yourself with this ABTA checklist.
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Written by Jessica Juby.
