Consumer Protection

The extent of regulated consumer protection in the event of a Travel Supplier’s financial failure can be complex and difficult to understand. The ATOL Guide to Consumer Protection provides an easy to understand set of examples on what consumer protection is currently available.

Package Holidays
When you buy a package holiday, which includes a flight, the tour operator should hold an Air Travel Organiser’s Licence (ATOL). This will protect your money in the event of the financial failure of the tour operator. In the event of the financial failure of the airline that is supplying the flight element of the package, the tour operator will be responsible for ensuring your travel arrangements are protected.

Scheduled Flights
There is no consumer protection (for either advance payments or for repatriation provision) in the event of financial failure of a scheduled airline whether a traditional IATA airline or Low Cost Carrier. If an IATA airline fails, arrangements might be put in place to protect bookings as a result of agreements reached between the IATA airlines themselves and, in particular airlines of any alliance of which the failed airline may have been a member.

Insurance
Scheduled airline failure insurance can be purchased to protect against the risk of airline failure, but care should be taken to understand any exclusions (typically any airline in chapter 11) and limits (typically up to £1,500 per ticket). Most standard travel insurance policies will not provide insolvency protection.

Credit card payments
Where payment has been made by a credit card some protection may be available under the Consumer Credit Act, but only where the payment is made directly to the airline and not on a debit or charge card.