Ask the Traveller: Atol scheme

"My wife and I have booked flight-only return tickets with Thomson from Cardiff to Las Palmas. The flight is not Atol-bonded. What are our rights should anything go wrong, or we're delayed coming home by volcanic ash or anything else?" Peter James

Good question, which touches upon the tangle of legislation – and the many loopholes – of consumer protection for air travellers. Bear with me as I explain your rights.

First, the Atol scheme offers only limited cover. It was introduced to protect package holidaymakers if their travel firm went bust before (or during) the trip. Over the years, it has worked well to ensure holiday- makers don't lose out financially. However, the proportion of travellers that it covers has declined.

More people are, like you, buying the components of a holiday separately. Cover is patchy: for example, Thomas Cook extends Atol protection to flight-only customers (and charges the standard £2.50 per person levy for the privilege), while its rival Thomson last year withdrew Atol cover from its flight-only product in order to be more competitive with the low-cost scheduled airlines.

Having said that, looking at the very strong cash positions and business models of these travel giants, it is difficult to envisage circumstances in which either company might collapse in the foreseeable future. Recent collapses have mainly involved small or medium-sized tour operators that trade at the bottom of the market. Therefore customers of more prudent operators are effectively subsidising those who seek the lowest possible price.

The question of delays has nothing to do with Atol, and is governed instead by the controversial EU261 rules. These stipulate that, whatever the cause of a delay or cancellation, all European airlines have an unlimited duty of care to the passenger. For the 2,800km flight from Las Palmas to Cardiff, a delay of three hours triggers the airline's responsibility to feed you and, if necessary, provide overnight accommodation until it can get you home.