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Holidayers set to benefit from greater protection

Holidayers set to benefit from greater protection

Category: Travel insurance

Updated: 26/11/2012
First Published: 03/02/2011

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

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:

  • Extend protection to include 'flight plus holidays'. This would cover trips including a flight where the various elements are purchased within a specified short period - essentially looking like a package holiday but falling outside the existing legal definition.

  • Deter businesses from misleading consumers about their level of protection. Some companies offer holidays which might look like packages but make the transaction as an 'agent for the customer' without explaining to the customer that this means forfeiting ATOL protection. These proposals are designed to provide customers with a clear and honest explanation so they can make informed decisions.

  • Replace the wide variety of documents which companies currently issue with standardised information for travellers, making it clear when their trip is ATOL protected. Work on this is already underway, with the Civil Aviation Authority and the travel industry developing an easily recognisable certificate for protected holidays.

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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