Travel insurance Updated:
People booking a holiday abroad are set to benefit from clearer and more extensive protection under new Government reforms.
Changes are to be made to Air Travel Organisers' Licensing (ATOL), which is a scheme that protects consumers on package holidays and some flights should their operator or travel agent go bust.
The scheme has helped more than 43,600 holidaymakers make their way back to the UK over the last 12 months, while almost 133,000 people have received full refunds after their tour operator went bust.
The new rules, which are expected to ensure that six million more holidays are protected, will:
The measures, which are expected to be drafted in after a consultation in the spring, will protect those who book their flights and accommodation separately.
"Since it was introduced, ATOL has provided protection for millions of holiday makers and I am determined to see this continue," said the Aviation Minister Theresa Villiers.
"Insolvencies in recent years have shown us how important it is that customers are able to buy protected holidays, but recent court cases have only served to highlight the fact that the scheme is in need of reform.
"These changes will remove much of the confusion surrounding ATOL, while ensuring operators which offer such holidays provide customers with the financial protection they expect."
The changes will also mean that the Government subsidy of the scheme – which currently runs at £42 million a year – will be reduced.
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