Travel insurance

What to do if your holiday company collapses

2 August 20194 min read

A picture of a wooden house on a sunny day with palm trees in the foreground in Florida, US, United States

Malvern Group, the package holiday provider behind Super Break and Late Rooms, has today annouced its closure.

The collapse has left thousands of customers in the lurch: though package holiday bookings made through Super Break are protected by ABTA, other products offered by the supplier - from attraction tickets to hotel-only breaks - are no longer valid.

"We recommend that where you have paid by credit/debit card that you contact your bank/credit card provider," Malvern Group advised in a statement.

For those who reserved a hotel through Late Rooms, which is not an ABTA member, Malvern Group "anticipates" that your booking is secure. However, they recommend getting in contact directly with the hotel to confirm.

If you've been affected by the collapse of Super Break and Late Rooms, it's is important to be aware of your rights in these difficult situations, so here we answer a few of the most commonly asked questions…

My holiday company has collapsed – will I still be able to go away?

It is likely that all holidays will be cancelled with immediate effect. It is not possible to transfer existing bookings to an alternative holiday company.

I’ve booked a package holiday but haven’t gone away yet – is my money protected?

Yes, as all travel companies in the UK selling package holidays and flights are required to hold an ATOL licence. The industry-wide ATOL scheme, run by the Civil Aviation Authority (CAA), protects the money of customers who purchase package holidays.

When you booked your holiday, you should have received an ATOL certificate and this will tell you what to do should your travel company stop operating.

You can apply to the CAA for a refund of the cost of your holiday, though the process can take several weeks. If you booked via a travel agent, they can help you with this.

There is nothing to stop you booking another holiday in the meantime, but many you may prefer to wait until the refund has been processed before shelling out a second time.

What happens if I’ve booked all of my holiday elements separately?

If you purchased a flight from the affected holiday company and the sale was covered by the ATOL scheme, you can apply for a refund – again, you should have received an ATOL certificate when booking with details on what to do (this will either be a Flight-Plus or a Flight-Only certificate). There is also the chance that you can continue with the travel arrangements.

If you decide to apply for a refund for the flights, but book new flights as your accommodation was already organised, your travel insurance policy might cover the additional airfare costs – check your individual policy’s terms and conditions carefully.

If you decide to apply for a refund for the flights and cancel accommodation that was booked directly by you, you might lose your hotel deposit and face cancellation charges. Again, your insurance company might cover this.

I booked accommodation only through the affected holiday company. Am I covered?

Hotel-only bookings are not covered by the ATOL scheme. Some travel insurance policies (look for end supplier failure in the terms and conditions) will cover your losses here. Alternatively, if the transaction is over £100 and you paid by credit card, apply to your credit card company for a refund due to “consequential losses”, as stated in section 75 of the Consumer Credit Act 1974.

Can I claim on my travel insurance?

Policies differ wildly on a number of clauses so it’s best to contact your travel insurance provider to find out if you can make a claim for losses resulting from the collapse of a holiday company. If you tend to book DIY trips, make sure you always take out a policy with end supplier failure to protect you should any element of your trip fail.

What happens if I am away when the company collapses?

The temptation is to panic, but there’s really no need. If your holiday is protected under the ATOL scheme, you should be able to enjoy the remainder of your holiday and fly home as planned. There is the possibility that you might have to move hotels or return on a slightly earlier or later flight, but the CAA or local representatives will assist you and answer any questions.

What if my hotelier asks me to pay for my accommodation again?

Talk to the CAA if this happens to you. If you feel pressured to pay, be sure to keep the receipt in order to apply for a refund once back in the UK.

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