Beached Holiday? Sun-seekers left high and dry

What happens if your tour firm goes under while you are away, asks Mark MacKenzie

Holidaymakers who risk being left high and dry and far from home are being urged to check they are adequately covered against their tour operator going under.The advice from the Civil Aviation Authority (CAA) follows the collapse of a Cheshire-based company, HCCT Holidays, which left up to 1,000 Britons stranded on the island of Tenerife.

Fortunately, the company was a member of the Air Travel Organisers Licensing scheme (Atol). This meant the CAA was able to organise repatriation for those marooned and refunds for those holding future bookings. But had those holidaymakers booked their travel independently, it would have been a different matter.

Coming in the month that is traditionally a boom time for summer bookings, the CAA's warning is a timely reminder of the damage insolvency could do to a much-anticipated break. "On any package where there is a flight involved travellers have financial protection under the Atol scheme," explains David Clover of the CAA's consumer protection unit.

"While this does include all holidays bought through traditional operators, if you're borrowing a villa from a bloke down the road, flying on a budget carrier and hiring a car yourself, you won't be covered." The CAA estimates that more than 18 million people will piece together their own holidays this summer.

But should only one element of your holiday collapse you might expect to dial your travel insurer's emergency number.

Think again, says Malcolm Tarling of the Association of British Insurers. "Most travel insurance policies will not cover the failure of an operator or service provider, such as a car hire company," he says.

"The policy will have very specific wording regarding exclusions to your contract and this will almost certainly be one of them." Part of the problem, says Mr Tarling, is that while many consumers pay careful attention to the levels of medical and luggage cover when insuring an independent holiday, the relatively unglamorous nature of insolvency means it can often pass them by.

So what can you do? "A good insurance broker can direct you to those policies that will cover you but obviously that will be reflected in a higher premium," says Mr Tarling. "Insurers are always looking for ways to improve products and if the insolvency of an operator is well publicised, they will try to make something available."

The same applies to the increasing number of travel insurance policies taken out on an annual basis. As "general insurance" products, their regulation falls within the remit of the Financial Services Authority (FSA). "It's fair to say they aren't the norm," says an FSA spokesman, "but annual policies covering insolvency are available."

It's a view shared by David Clover. "The reality is that products offering insolvency cover are few and far between," he says. If you do want to book a break on an accommodation-only basis, however, you don't have to give up your rights.

"Under the Consumer Credit Act (2006), credit card companies have joint liability with the service provider - if the service isn't forthcoming for any reason, and that company has no money available for a refund, the consumer can then turn to their card provider."

Buyer beware, however; if you choose to pay with a debit card, no such protection exists.

"An alternative is to look for providers bonded by independent organisations," says David Clover. "The Association of Independent Tour Operators (Aito), for example, has its members bonded on the basis of what they provide. If it's accommodation only, some financial cover will be available. All these organisations display badges. If you don't see them when booking your break, you need to think where your protection is coming from."

News
newsGlobal index has ranked the quality of life for OAPs - but the UK didn't even make it into the top 10
News
people
News
people
News
peopleStella McCartney apologises over controversial Instagram picture
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
Gillian Anderson was paid less than her male co-star David Duchovny for three years while she was in the The X-Files until she protested and was given the same salary
people

Gillian Anderson lays into gender disparity in Hollywood

Life and Style
Laid bare: the Good2Go app ensures people have a chance to make their intentions clear about having sex
techCould Good2Go end disputes about sexual consent - without being a passion-killer?
Arts and Entertainment
Richard Burr remains the baker to beat on the Great British Bake Off
tvRichard remains the baker to beat as Chetna begins to flake
News
i100
Sport
footballArsenal 4 Galatasaray 1: Wenger celebrates 18th anniversary in style
Arts and Entertainment
Amazon has added a cautionary warning to Tom and Jerry cartoons on its streaming service
tv
News
people
News
The village was originally named Llansanffraid-ym-Mechain after the Celtic female Saint Brigit, but the name was changed 150 years ago to Llansantffraid – a decision which suggests the incorrect gender of the saint
newsA Welsh town has changed its name - and a prize if you can notice how
Travel
ebookHow to enjoy the perfect short break in 20 great cities
Arts and Entertainment
Kristen Scott Thomas in Electra at the Old Vic
theatreReview: Kristin Scott Thomas is magnificent in a five-star performance of ‘Electra’
News
Destructive discourse: Jewish boys look at anti-Semitic graffiti sprayed on to the walls of the synagogue in March 2006, near Tel Aviv
peopleAt the start of Yom Kippur and with anti-Semitism flourishing, one Jew can no longer ignore his identity
Life and Style
Couples who boast about their relationship have been condemned as the most annoying Facebook users
tech
Arts and Entertainment
Hayley Williams performs with Paramore in New York
musicParamore singer says 'Steal Your Girl' is itself stolen from a New Found Glory hit
News
i100
Independent Travel Videos
Independent Travel Videos
Simon Calder in Amsterdam
Independent Travel Videos
Simon Calder in Giverny
Independent Travel Videos
Simon Calder in St John's
Independent Travel Videos
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Travel

    Service Charge Accountant

    30,000 to 35,000 per annum: Accountancy Action: We are currently recruiting on...

    Management Accountant

    28,000 to 32,000 per annum: Accountancy Action: Our client, a hospitality busi...

    Food and Beverage Cost Controller

    18,000 to 20,000 per annum: Accountancy Action: Our fantastic leisure client i...

    Marketing Analyst / Marketing Executive

    £20 - 24k: Guru Careers: A Marketing Analyst / Marketing Executive is needed t...

    Day In a Page

    Italian couples fake UK divorce scam on an ‘industrial scale’

    Welcome to Maidenhead, the divorce capital of... Italy

    A look at the the legal tourists who exploited our liberal dissolution rules
    Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

    Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

    The vintage series has often been criticised for racial stereotyping
    An app for the amorous: Could Good2Go end disputes about sexual consent - without being a passion-killer?

    An app for the amorous

    Could Good2Go end disputes about sexual consent - without being a passion-killer?
    Llansanffraid is now Llansantffraid. Welsh town changes its name, but can you spot the difference?

    Llansanffraid is now Llansantffraid

    Welsh town changes its name, but can you spot the difference?
    Charlotte Riley: At the peak of her powers

    Charlotte Riley: At the peak of her powers

    After a few early missteps with Chekhov, her acting career has taken her to Hollywood. Next up is a role in the BBC’s gangster drama ‘Peaky Blinders’
    She's having a laugh: Britain's female comedians have never had it so good

    She's having a laugh

    Britain's female comedians have never had it so good, says stand-up Natalie Haynes
    Sistine Chapel to ‘sing’ with new LED lights designed to bring Michelangelo’s masterpiece out of the shadows

    Let there be light

    Sistine Chapel to ‘sing’ with new LEDs designed to bring Michelangelo’s masterpiece out of the shadows
    Great British Bake Off, semi-final, review: Richard remains the baker to beat

    Tensions rise in Bake Off's pastry week

    Richard remains the baker to beat as Chetna begins to flake
    Paris Fashion Week, spring/summer 2015: Time travel fashion at Louis Vuitton in Paris

    A look to the future

    It's time travel fashion at Louis Vuitton in Paris
    The 10 best bedspreads

    The 10 best bedspreads

    Before you up the tog count on your duvet, add an extra layer and a room-changing piece to your bed this autumn
    Arsenal vs Galatasaray: Five things we learnt from the Emirates

    Arsenal vs Galatasaray

    Five things we learnt from the Gunners' Champions League victory at the Emirates
    Stuart Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

    Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

    This deal gives England a head-start to prepare for 2019 World Cup, says Chris Hewett
    Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

    The children orphaned by Ebola...

    ... then rejected by surviving relatives over fear of infection
    Pride: Are censors pandering to homophobia?

    Are censors pandering to homophobia?

    US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
    The magic of roundabouts

    Lords of the rings

    Just who are the Roundabout Appreciation Society?