What to do if your airline goes bust

First things first

The first thing to do if you hear that your airline has gone bust is to contact your travel agent – if you booked with one – to see if your booking is still in place. If it is, then your travel arrangements should be relatively unaffected. You may have to change flight times, but your holiday or trip should proceed as before. If not, you’ll need to check your documents to see if you’re ATOL-protected.

ATOL protection

There are certain rules as to whether you’re ATOL-protected if you have booked your flight, hotel and car hire separately. If you booked your flights and accommodation on the same day, or within a day either side, and if the company you booked with is ATOL-registered, then you’re protected and can apply to the Civil Aviation Authority to reclaim your money. This also applies if you booked your flights and car hire together. However, if you booked flights and accommodation directly with the bankrupt airline then you won’t be covered.

What if you’re already on holiday?

If you’re abroad when the airline goes bust then whether or not you have to rearrange and pay for your own flight home again depends on whether you are ATOL-protected. If you are, then you are guaranteed a refund and will be put on an alternative flight home at no extra cost. However, if you’re not ATOL-protected, you will have to book an alternative flight yourself and pay for it. There may be special ‘repatriation fares’ available so make sure you check with different airlines, as well as with your travel insurance company.

What to do if you're not ATOL protected

There are two routes open to you if you’re not ATOL protected and your airline goes bankrupt: travel insurance and credit or debit card protection:

1. Check your travel insurance

   Uncertainties like your airline going bust are one of the most important reasons to take out travel insurance the second you have booked your trip. Depending on the type of insurance you may sign up for, you can protect yourself against flight companies going out of business, as well as the cancellation of your flight. Add the peace of mind that comes with going away knowing that you’re covered for any loss or emergency and you can relax before your holiday has even begun.

2. Protection from your credit card

   If your travel insurance policy doesn’t cover your airline going bust, you may be able to claim back your money through your credit card company. To be eligible, you need to have paid more than £100 for your flights and booked directly with the airline. If you paid by debit card, you may be able to claim through the Mastercard and Visa Chargeback scheme, which most high street banks have signed up to. This allows you to ask your card provider to reverse a transaction on your debit card, giving you your money back.

How to claim

If you’re claiming your flight cost through ATOL, you need to apply to the Civil Aviation Authority (CAA) for a refund. If your flight is not ATOL-protected, you need to get in touch with your insurance company, credit card company or bank as soon as possible so they can begin the claim process. Make sure you have the full details of your booking when you call, as well as the details of your payment.