Your rights if an airline or travel company goes bust varies depending on your circumstances.
Package holiday bookings can get more complicated if you have booked with a firm that has gone bust, as they usually pay for your flights immediately on receipt of your booking and the hotel 30 days later.
You will need to decide if you want to proceed with your flights and try to arrange your accommodation separately or try to arrange for your flights to be changed. You can book your hotel again, keep receipts and try to submit a claim in due course.
PACKAGE HOLIDAYS – AGENT OR INTERMEDIARY
If you have booked a flight and hotel together, this was bought as a package therefore there is a direct link which validates your claim.
The Package Travel and Linked Travel Arrangements 2018 covers this and stipulates that you are protected and repatriated home if necessary.
If you booked a hotel and flights separately with a holiday firm, they have acted as an agent / intermediary.
Section 75 of the Consumer Credit Act 1974 may not work as there is no direct link between you and the hotel.
This is what the credit card provider may use to reject your claim if it falls in that remit, so be prepared for a rejection and submit a claim to the Financial Ombudsman Service. This is a free and impartial adjudicator, and they usually give a decision within 8 weeks of receipt.
FLIGHT ONLY ARRANGEMENTS
This does not apply if you have booked your flights directly with the airline.
PAYING BY CREDIT CARD
If you have paid by a credit card (even if it is just 1p or a deposit), you can submit a claim against the credit card provider under Section 75 of the Consumer Credit Act 1974 as the credit card provider is jointly and severally liable when things go wrong with retailers.
PAYING BY DEBIT CARD
If you have used a debit card, you can submit a chargeback claim within 120 days of the date that your holiday was due to commence. This is not a legal requirement by the card providers or banks and is simply a voluntary scheme.
Travel insurance policies may cover the failure of a travel firm. Check your policy and the small print carefully.
REGISTERING AS A CREDITOR
Registering as a creditor is usually a fruitless exercise when it comes to being paid any monies due. You are literally at the bottom of the priorities for any payments.
Have you been affected by an airline or travel company going bust? If so, what was the outcome?