Thomas Cook: Your questions answered

With news of Thomas Cook’s financial difficulties hitting the headlines this week and concerns about its future, you may be nervous about booking a holiday. We take a look at the current situation and tell you the three golden rules when booking any trip.

When Europe’s second-largest tour operator, Thomas Cook, announced that it needed to borrow £100million this month, the company’s share prices dropped. The company had only just secured a new credit agreement of £100million in October, so questions are naturally being asked about how safe it is.

However, there’s no need to panic. We answer your questions below…

What’s the current situation?

BREAKING NEWS: On November 25, 2011, Thomas Cook's banks agreed to lend the company the further £100million, and share prices have started to recover. All holidays are operating as normal and there is no known disruption to the customer facing operation – apart from some longer than normal call waits in its customer call centres.

What happens if I have already booked a Thomas Cook holiday?

There’s no need to worry at the moment.

All package holidays carrying the Thomas Cook name or any of its subsidiary names are covered by the Civil Aviation Authority (CAA) backed ATOL scheme. This means that if the company was to collapse, your money would be protected under this scheme whether you booked your holiday in a Thomas Cook shop, any other travel agency, via the company’s website, or through one of its call centres.

If you were on holiday at the time of a collapse, you would be able to continue your break and the CAA would arrange new flights for you to travel home as scheduled.

If Thomas Cook was to cease operating after you had made a booking but before you had travelled, your holiday would be lost but your money would be protected and you could apply for a refund through the CAA. You would then need to book another trip with another company if you still wanted to travel.

I booked a holiday through Thomas Cook but it’s with another company – where do I stand?

Again, there’s no need to panic.

If Thomas Cook was to collapse, your money would be protected under ABTA regulations and the third-party company your holiday was with (for example, Cosmos) would take over the booking. You would then either deal with the other company directly or through a nominated travel agent – you would not lose your holiday or any money.

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I’ve booked a flight or a hotel only through Thomas Cook - am I covered?

If you have booked any kind of separate travel arrangements through Thomas Cook, you are unlikely to be covered by the ATOL scheme. It is worth checking your travel documents now and contacting Thomas Cook if you have any queries. As long as the money has been paid to the airline or hotel in question, the booking is likely to be honoured – with the exception of Thomas Cook Airlines as they would no longer be operating.

If you paid Thomas Cook with a credit card or Visa debit card, you will have protection for any transaction of more than £100.

If you already have travel insurance, you may be covered with a clause called End Supplier Failure. If you don’t already have this and aren’t covered through a credit or Visa debit card payment, consider taking out a new policy to be safe. It is wise with any policy like this to check the small print for any exclusions.

I have some Thomas Cook gift vouchers – can I still spend them?

Yes, you can still spend them. However, in the event of a collapse, they would be worthless so use them now – following our three golden rules below – to make sure you benefit from their full value.

Is it still safe to book a holiday through Thomas Cook?

This is a decision that you must make as an individual. The company is still trading as normal and holidays operating without issues. So, if you see a deal that is right for you – and follow our three golden rules below – you are safe to book any travel arrangements with full ATOL cover. If the company was to cease operating, your money would be protected but you would need to find a new holiday.

The three golden rules of booking any holiday

If you follow the golden rules below, you will have belt-and-braces protection for your money should any part of a holiday collapse with any company.

  • Book an ATOL-protected holiday where possible
  • Pay by credit card or Visa debit card
  • Take out a travel insurance policy that includes End Supplier Failure.

Please note: Any facts, rates or deals mentioned in this article were available at the time of writing.

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