Simon Calder: When Holidays 4U turns out to be 'no Holiday 2 anywhere'
The man who pays his way
Simon Calder is Travel Editor at Large for The Independent, writing a weekly column, various articles and features as well as filming a weekly video diary. Every Sunday afternoon, Simon presents the UK's only radio travel phone-in programme called The LBC Travel Show with Simon Calder (97.3 FM). He is a regular guest on national TV, often seen on BBC Breakfast, Daybreak, ITV News and Sky News. He is often interviewed on BBC Radio, particularly for BBC Radio 4’s You & Yours programme and BBC Five Live.
Saturday 13 August 2011
Total Financial Protection: as rumours in the travel business intensify about the next tour operator which might go bust, the cover offered by the well-regarded online agency, Travel Republic, looks all the more valuable. Total Financial Protection, says the company, kicks in "in the rare event of the insolvency of your Travel Provider, giving you complete peace of mind". Phew.
Holidays are unlike other big-ticket purchases: you buy a dream, and start to take delivery only when you turn up at the airport. But last week 50,000 people woke up to find their travel plans wrecked. They were customers with bookings on Holidays 4U, the latest tour operator to fail.
As our guide to holiday protection on page 7 explains, disappointed package holidaymakers will get refunds from the Civil Aviation Authority – eventually. But people who booked flights with Holidays 4U and beds through a different provider are flummoxed. The accommodation owner can say something to the effect of "the room is still here; the fact that you can't get here isn't our problem, pal". Either find another way to reach the resort, or you lose cash.
All the more reason to appreciate Travel Republic's assurance that "with Total Financial Protection all bookings are protected". But this promise is not what you might assume it to be. You will, indeed, get a full refund if the airline goes bust, but other components of the holiday contingent on that departure are unprotected.
"Each booking made on our website is a separate transaction," says the company, and each is "covered by separate financial protection". So if your flight is cancelled and you can't reach the resort, don't expect a refund for the room.
Pete Devenish from Oxfordshire was one of the prospective travellers in the unfortunate position of having bought flights to Turkey on Holidays 4U and accommodation elsewhere. When the flight provider failed, he was unable to buy suitable replacements and therefore had to cancel. He had made the whole holiday booking, with a value of over £3,300, through Travel Republic, which states "Each product (eg flight, hotel or car hire) is booked separately by you with the travel provider and creates a contract directly between you and the provider." Travel Republic emphasises that it "does not sell, organise or arrange package holidays".
Mr Devenish will, when the CAA gets around to repaying Holidays 4U customers, get the money for his flights back in full. He inferred from the term "Total Financial Protection" that he would also be able to reclaim the cost of accommodation. But Travel Republic told him that wasn't the case: "At this stage, the normal cancellation fee would be 100 per cent loss. Under the circumstances, we have managed to reduce this to a one-night fee." That's £317.
After the Independent Traveller intervened, the fee was dropped. A spokesperson for Travel Republic said: "We aim to please each and every customer and thank you for highlighting the concerns of Mr Devenish. As a gesture of goodwill, we will cover his cancellation charges in full. We would also like to offer him 10 per cent off his next accommodation booking through Travel Republic."
The promise of Total Financial Protection remains on the Travel Republic website. To me, what it really seems to amount to is Partial Financial Protection, a term without the same ring.
Credit note or refund? The choice is yours
A good way for a tour operator to prosper – and you need not be Warren Buffett to work this out – is to sell only holidays that will earn a profit. It has always been a perfectly respectable practice for holiday companies to advertise departures that may not materialise.
If not enough people sign up, they cancel the trip and pay refunds. The specialist singles operator, Solitair, is typical: "Solitair Holidays reserve the right to cancel a tour if such numbers are not reached."
Maureen Dagg's planned Solitair holiday to Turkey last month was cancelled. But her disappointment turned to alarm when she learned: "Solitair will not offer a refund of the holiday cost." Instead, she was offered an alternative holiday or a credit note, to be used within a year.
"I don't want a credit note as I don't want any of their alternative tours," says Ms Dagg. "I want my money returned so that I can book another holiday – not much to ask, is it?"
Indeed it isn't. The law is clear: Ms Dagg can insist upon an immediate refund. Solitair says that it took legal advice and was told it could withhold customers' money. It now accepts this was mistaken, and has changed its terms to include the option of "a full refund of all monies paid by you".
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