Posted on 10 October 2020

It's bad enough if your airline goes bankrupt before your booked flight, but what happens if it goes to the wall while you're already overseas? The sensation of being stranded abroad is not pleasant - especially if you are holidaying in a long-haul destination.

With ATOL protection

If you bought your flight with ATOL protection, you're assured a refund should your airline collapse. If you're stranded overseas, you must be found an alternative flight - at no extra cost.

As soon as you find out your airline has gone bust, contact your travel agent, who will be able to arrange refunds/alternative flights.

Without ATOL protection

If you purchased your flight ticket without ATOL protection, you'll need to arrange an alternative flight out of your own pocket. However, in circumstances where many people are stranded overseas, the government may step in - such as when Monarch collapsed and the UK government organised repatriation flights for thousands of UK holidaymakers.

Repatriation fare

In some circumstances, the newly bankrupt airline may offer discounted 'repatriation fares' to its customers. These would be available a few hours after the bankruptcy is made public, and may be available for a week or two.

Before you book a flight home

Check if you're covered for these extra costs by your travel insurer. Also look at other options with other airlines.

Getting a refund

Even without ATOL protection, you may be able to get a refund. However, this may take several weeks to be processed. At time of writing, many airlines are facing hardship due to Covid-19 - and some may go bust. For example, Thai Airways customers have seen many of their flights cancelled in recent weeks and months, as the carrier restructures its debt. Some customers who had flights cancelled in March of this year - the peak of the pandemic - are still awaiting refunds.

What exactly is ATOL?

ATOL stands for Air Travel Organiser's Licence and is a "UK financial protection scheme and it protects most air package holidays sold by travel businesses that are based in the UK." (Civil Aviation Authority).

ATOL protection is available if your flight was bought as part of a package holiday with a UK travel agent. Before booking, make sure the ATOL logo and license numbers are visible in agent windows and websites.

If you booked your flight directly with the airline, you probably won't be covered by the ATOL scheme unless you bought it as a "linked travel arrangement".

Linked travel arrangements explained

This is when you purchase one travel service from an operator and are promoted to buy another by clicking through to another site (eg flight + hotel + transfer), but you enter your personal details and payment information separately for each service. These services must all be bought with a 24 hour period to be classed as a linked travel arrangement.

If your flight was booked as part of a linked travel arrangement, you'll be able to get your money back thanks to insolvency protection. However, you won't automatically receive any help if you're stranded abroad.

The initial service provider is obliged to make clear you've bought a linked travel arrangement.

I don't have ATOL protection - what are my options?

If you bought the flight/holiday with a credit card and it cost more than 100GBP, you can claim against your credit card company under Section 75 of the Consumer Credit Act.

If the cost was under 100GBP and you paid by debit card, you may still be able to get a refund by using the chargeback scheme.

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