Travel Insurance

Mike_J

Just want to clarify something my wife heard on the telly in relation to airlines and travel insurance. We have an annual policy which is about the renew. The majority of our trips are either packages or more often flights and accommodation booked at the same time through a well know reputable online travel agent. In the majority of cases I suspect that ATOL/ABTA woudl be good enough if anything would happen to the airline.

My wife though says she heard something that said that if the airline had received any kind of financial assistance prior to booking, even if it was still atol/abta, then the benefits wouldnt apply. I think she may have misheard and the story relating to separate bookings ?

So....can anybody confirm....
a) Any previous financial assiatnce is irrelevant for ABTA/ATOL protection if member at time of booking.
b) Could my wife be refering to Scheduled Airline Faliure ? She says its minimal according to the articlae, and we have it in our insurance already.
or
c) Could she be refering to End Supplier Failure which appear to be same as b) but covers hotel as well (but it basically doubles our premium on our annual policy)

(may only thing with b&c as they again appear to be insurance you take out and are not dependent on the supplier never having previous assistance)

Thanks

TELLIT01

I haven't heard anything along the lines described by your wife, but as long as you have your own travel insurance it won't matter anyway. The insurer will have the responsibility of getting you home rather than ABTA/ATOL if what she has heard is true.

leylandsunaddict

Under the Travel Disruption section of my policy which covers Supplier Insolvency as part of it, it states under What is Nott Covered

" The financial failure of any scheduled airline which is insolvent at the date this insurance is purchased or at the time of booking any trip (whichever is the earlier)"

"Any scheduled airline which is bonded or insured elsewhere (even if the bond is insufficient to meet claims)"

So as long as the airline is solvent when you book the flight or take out the insurance you're covered.

Airlines don't hold an Atol nor are they Abta members. Abta covers you if the agent goes bust before having paid their suppliers for your booking. ATOL protects if the agent you booked with fails. If their supplier, (or one of their suppliers in the case of a multi contract package) they have used fails the agent must make alternative arrangements for you or be responsible for a refund. Insurance would refer you back to the Atol issuer. If you've got an Atol certificate to cover everything then there is no need to have supplier failure (SAFI) or supplier insolvency cover on your insurance.

If you've booked a flight only, accommodation only, or both but not at the same time or have paid separately for them that is where SAFI and/or supplier insolvency comes in.

We don't book package holidays, but always have supplier insolvency and consequential loss cover, as well as paying by credit card where possible. We book flights direct with the airline and accommodation direct with the owner so it isn't always possible, but that is covered under supplier insolvency should the owner go out of business, or by the consequential loss cover if the airline goes bust, or airspace is closed and we can't get there.

Mike_J

leylandsunaddict.... I believe what she may have heard about is as you described as above in relation to airline insolvency. When I showed her your reply she confirmed that is what they were talking about BUT the article warned that most of the general public would not know if an airline was insolvent (many UK businesses could be insolvent on any given day without it being public knowledge) at the time of making a booking.

leylandsunaddict

Mike_J wrote: »

leylandsunaddict.... I believe what she may have heard about is as you described as above in relation to airline insolvency. When I showed her your reply she confirmed that is what they were talking about BUT the article warned that most of the general public would not know if an airline was insolvent (many UK businesses could be insolvent on any given day without it being public knowledge) at the time of making a booking.

As far as I know it means that they haven't declared insolvency, not that they're having cash flow problems. If you've got an Atol certificate to cover the booking then it becomes irrelevant anyway. The CAA would repatriate you, or the agent who you booked through would refund you if you hadn't travelled. Even if you had no Atol the insurer would refer you to your card provider to claim.

Insolvency just means you haven't enough to pay your debts. Taking that literally it means you could be insolvent one day and solvent the next. Lot's of companies globally operate like that. I don't think that is how insurances companies view it. It would be if they had declared insolvency but were still trading eg Chapter 11 airlines in the US.