Financial protection in travel can be confusing; here you’ll find a summary of when your money is protected and what you can do when it isn’t.
There are a number of schemes available to ensure that your money is safe and that you will be repatriated should your travel company go out of business. All package holidays sold to you in the European Economic Area (EEA) by ABTA Members are financially protected so that if your travel company fails, you’ll be able to continue your holiday as planned or get your money back.
Financial protection in travel can be confusing, so here we give you an easy-to-follow run down of when your money should automatically be protected and what you can do when it isn’t. We also have a checklist for what paperwork you need when booking your holiday.
Remember that the easiest way to ensure you get the protection you want is to ask your travel company if, and how, your travel arrangements are protected.
ABTA travel companies will be able to advise what to do if you don’t have automatic protection.
When your money will be automatically protected if your holiday is sold to you in the UK.
If you book your holiday from outside the UK, this protection won’t apply unless the ABTA Member has opted to voluntarily protect your holiday with us, or unless a different scheme applies. You must enquire with your travel company to see whether your holiday is protected either voluntarily by the travel company, or under a different scheme.
The Package Travel and Linked Travel Arrangements Regulations 2018 apply to holiday travel arrangements booked on or after 1 July. The new regulations cover two types of travel arrangements – package holidays and linked travel arrangements – which have different levels of protection. Other travel arrangements, for example, accommodation only, might not be protected. More details, including how the level of protection varies, can be found here.
You should check with your travel company whether your travel arrangements are protected.
Don’t rely on travel insurance: very few travel insurance policies cover company failures. They cover belongings, delays/cancellations and medical assistance but don’t usually refund you or get you home if your holiday company fails.
Do ask your travel agent for help: your ABTA travel agent can help you with supplier failure insurance for products and services that are not automatically protected.
Do check your credit card T&Cs: under the terms of the Consumer Credit Act, credit cards (but not debit or charge cards) offer you some protection if your holiday company goes out of business.
You should be able to get your money back (this applies to payments between £100 and under £30,000 under the Act) however credit card issuers will not help you get home if you are abroad when the company goes out of business.
Although there is no legal requirement for debit cards to cover you, you may be able to claim from your bank under Visa’s voluntary policy. You need to check with your bank for more information.