Read our guide on supplier failure holiday insurance
In this guide we'll tell you what protections you have when booking a package holiday and what travel insurance will cover.
Key takeaways
Travel insurance is another key aspect of protecting your holiday investment.
Consider SAFI (Scheduled Airline Failure Insurance) which can protect you against the costs that arise if an airline or travel agent fails.
This type of coverage can provide alternative flights and accommodation if necessary.
Is your holiday financially protected?
One of the biggest concerns when booking a holiday is whether your hard-earned money is safe. Financial protection can vary greatly depending on how you book your trip. Package holidays often come with a safety net in the form of ATOL protection, which is something to check for when considering different travel options. But what does this really mean for you and your travel plans?
Package holidays typically offer a layer of financial protection that you don't get when booking your flights, accommodation, and other travel components separately. If you're going down the DIY route for your holiday bookings, be aware that you're likely to have minimal or no financial cover should something go wrong.
The collapse of airlines and travel companies in recent years has highlighted the risks of financial loss. Such events can leave travellers stranded or out of pocket, and without the right protection, there may be no recourse for recovery. That's why understanding the protections in place, like ATOL, is crucial for any traveller.
What is ATOL?
ATOL, which stands for Air Travel Organiser's Licence, is a UK financial protection scheme that safeguards your money if you've booked a package holiday. If your travel provider goes bust while you're on holiday, ATOL is there to ensure you don't lose the money you paid or that you're not left stranded abroad.
It's a good idea to read up on the ATOL scheme and check whether your travel organizer is a member by visiting the Civil Aviation Authority (CAA) website. This simple step can give you peace of mind before you even pack your bags.
Some travel organizers may offer their own financial protection schemes, which can cover you in the event of business failures of airlines or hotels. It's always worth asking about these protections when booking your trip.
How can you get comprehensive travel insurance coverage?
Travel insurance is another key aspect of protecting your holiday investment. However, it's important to note that not all travel insurance policies are created equal. While many cover common travel mishaps, they may not extend to company bankruptcies or other financial failures.
Most insurance policies are designed to cover "specified risks" rather than "all risks," which can leave gaps in your coverage. Fortunately, there are more comprehensive policies available that cover a wider range of issues, including End Supplier Failure and Scheduled Airline Failure Insurance (SAFI).
Understanding scheduled airline failure insurance (SAFI)
Before you finalize your travel insurance, check if it includes SAFI. This coverage is designed to protect you against the costs that arise if an airline or travel agent fails. However, be aware that some insurers might exclude certain airlines from their coverage, so it's important to read the fine print.
Insurers such as Sainsbury's Bank, and RAC offer SAFI, and you can compare these options on MoneySuperMarket to find the right fit for your travel needs.
What is end supplier failure?
Comprehensive travel insurance policies may also include coverage for the financial failure of end suppliers, such as hotels and airlines. This type of coverage can provide alternative flights and accommodation if necessary and may cover other travel components.
Insurers that offer policies with end supplier failure coverage are also featured on comparison services, allowing you to evaluate your options and choose a policy that best suits your holiday plans.
What if your current policy lacks supplier failure protection?
If your existing travel insurance policy doesn't include supplier failure or SAFI, don't worry. You have the option to purchase stand-alone cover for these specific risks. Using MoneySuperMarket, you can compare quotes and find a policy that offers the additional protection you need.
When it's time to renew your travel insurance, consider these features carefully. Don't make the mistake of basing your decision solely on price; the cheapest option may not provide the comprehensive coverage you require. Remember, insurers can tailor bespoke policies to cover specific aspects of your holiday.
Tips for protecting yourself when booking a holiday
When planning your holiday, keep these tips in mind to ensure you're protected:
Check the reliability of the booking company.
Verify that the operator or agent is ATOL bonded and look for membership in organizations like ABTA, TTA, or the Global Travel Group.
Use a VISA or MasterCard debit card for chargeback options.
Use a credit card for transactions over £100 to benefit from the Consumer Credit Directive 2011 protection, which makes credit card providers jointly liable for refunds if services are not delivered or a firm goes bust.
How to find comprehensive travel insurance
To ensure you're fully covered for your next adventure, it's essential to compare travel insurance policies that include both SAFI and end supplier failure protection. By providing your travel details to MoneySuperMarket, you can be directed to insurance deals that match your specific needs and give you the comprehensive coverage you deserve.
As you embark on your next journey, remember that the right preparation can make all the difference. With the proper protections in place, you can focus on the excitement of your travels, secure in the knowledge that you're safeguarded against the unexpected. Happy travels!
You can read more about ATOL from the UK Civil Aviations Authority as well as use the CAA website to check ATOL memberships.
Ensure the tour operator or travel agent is bonded with ATOL. You can do this on the CAA website. Also check your travel agent is a member of the Association of British Travel Agents (ABTA), Travel Trust Association (TTA), or Global Travel Group. They ensure that money paid to their retailer members is covered.
