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How safe is your holiday?

Our holidays are important to us; they’re often seen as our reward for working so hard all year round.

They are expensive too, so when we book our annual break we want to make sure our money and our holiday are safe.

The Internet has given us access to multiple holiday possibilities and, before we book, most of us spend a lot of time researching places to visit, flights, and activities we want to do while we're away. But when we're ready to book, how do we make sure our booking is protected should the worst happen and our holiday provider or airline goes bust?

A sure-fire way of protecting your holiday is to book with an ATOL protected company.

By law, every UK-based travel company selling package holidays, flights and accommodation must have an ATOL licence.

What is ATOL Protection?
The Air Travel Organiser’s Licence (ATOL) scheme is run by the UK Civil Aviation Authority and offers protection for customers in the event that their airline goes bankrupt.

So far this year, two holiday companies, which were members of the ATOL scheme, have failed; and in the last five months of 2014 six ATOL-protected companies ceased trading.

Each year, around 20 million holidaymakers are ATOL protected. Last year, more than 5,000 customers benefited from ATOL protection when their holiday companies went bust: 4,795 received full refunds and 534 were flown home at no extra cost. In 2013, 10,373 ATOL-protected passengers received refunds and 494 were repatriated.

The following types of holiday bookings are covered by ATOL:

  • Flight inclusive packages – traditional package holidays
  • Flight plus – a booking that includes a flight and accommodation (including cruise) or car hire, or both. In order get ATOL protection, these components should be booked together or within a day of each other – leave a longer time period between booking these items and you may not be covered
  • ATOL protected flight only – these are flights, often charter flights, where you don't receive a valid airline ticket straight away.

How to check if you're covered
Before booking, always check for ATOL protection and make sure you receive your ATOL certificate as soon as you pay any money – you should receive a certificate even if you have only paid a deposit.

Keep it safe
Your ATOL certificate is important; it tells you who is covered, what is covered and what to do in the event that your airline fails. Don't forget to take your certificate – or a photocopy – on holiday with you.

When are you not covered?
In most cases you will not be covered if:

  • You book your flight and get a ticket straight away
  • You book accommodation or car hire only
  • You book a holiday but no flights
  • The travel company is based abroad.

BEWARE Not all holidays sold in the UK are ATOL protected. If the travel company is based abroad, you will not be covered by ATOL.

DIY holidays
By DIY we don't mean home improvements; we mean putting together individual components to create your very own personalised holiday.

While this can seem to be the ideal solution to achieve exactly what you want, you could be putting your holiday and your finances at risk should your airline or accommodation provider go bust.

If you book flights directly with an airline, but book accommodation separately, these are unconnected and will not be covered by ATOL. So, if your airline or accommodation provider ceases trading, you’ll need to make alternative, often more expensive arrangements. And, if you cannot find replacement flights or accommodation, you may not be able to continue your holiday or gain a refund. You also run the risk of being stranded abroad if the airline you flew with went bankrupt during your holiday.

Some travel agents now offer a more flexible approach to holiday packages, so shop around to find an agent that can accommodate your wishes.

If you do decide to take the risk and put together your own DIY holiday without ATOL protection, you should:

  • Make the booking using a credit card – each element must have cost at least £100 to have a chance of some comebacks, however, this will not provide full protection. You will not be covered if you pay with a debit card.
  • Take out specialist travel insurance that covers against airline failure - most policies do not automatically include this cover, so you will need to request it. Scheduled airline failure cover should cover consequential losses, but always check the small print.