Holidaymakers are being reminded of the importance of travel insurance following news this week of financial difficulties at tour operator Thomas Cook.
The firm warned investors on Tuesday that it would need to borrow extra cash from lenders as a result of operational difficulties.
This has raised concerns among travellers who have booked trips with the group about whether their holidays are safe.
But Thomas Cook stressed that customers should not worry. Boss Sam Weihagen said: “We have the same protection in place as any other travel company.”
How trips are protected
Customers who have booked package holidays with Thomas Cook – that is, trips with a flight plus accommodation or car hire – are covered under the Civil Aviation Authority’s ATOL scheme.
This means you would be able to claim refund for the money you had spent if the firm you have booked with goes busy before you travel.
If the company goes out of business while you are abroad, ATOL will pay for you to be flown home at the end of your trip, as well as covering any unpaid hotel bills.
If you have only booked a flight through Thomas Cook and arranged accommodation yourself, for example, you would not be protected in this way.
Travel experts said holidaymakers should ask always their travel agent what protection they were eligible for.
Even if your booking is covered under a scheme such as ATOL, it is always worth giving yourself as much protection as possible.
That’s why it is a good idea to take out travel insurance as soon as you pay for the holiday: this means that if you have to cancel the trip for any reason, you will be able to claim back the cost on your policy.
Make sure also that your insurance covers supplier failure, which means it will act as back-up cover if your holiday company goes out of business.
If possible, you should also pay for your booking with a credit card or Visa debit card: this means that your bank is also liable to compensate you if anything goes wrong, under either the Consumer Credit Act Section 75, which applies to credit-card purchases worth £100 or more, or the Visa chargeback scheme.