Am I protected if my holiday company goes bust?

ATOL — the Air Travel Organisers' Licensing scheme, run by the Civil Aviation Authority under the Civil Aviation Act 1971 and the ATOL Regulations 2012 — exists for exactly this situation. When a licensed company collapses, the Air Travel Trust takes over, and around 99% of eligible claims are paid in full.

What is and is not covered

• Covered: package holidays that include a flight, flight-only bookings made through an ATOL-licensed tour operator, and "flight-plus" arrangements where a flight and accommodation are booked separately but linked.
• Not covered: flights booked directly with an airline, hotel-only bookings, cruise-only bookings (bonded through ABTA instead), and anything bought through a travel agent with no ATOL licence.
• Your proof is the ATOL Certificate, issued when you book. It carries the operator's licence number and lists what is protected — upgrades, transfers and extras are covered only if they appear on it. If you never received one, ask now; if the company cannot produce one, the booking may be unlicensed.

Check a licence number on the public register at atol.org/check before booking, and be wary of "split" bookings structured to fall outside ATOL — the Linked Travel Arrangements rules catch some of these, but cover is patchy. Non-flight packages such as coach holidays sit outside ATOL entirely, though the Package Travel Regulations 2018 still require the organiser to hold insolvency protection.

If the company fails

The CAA publishes a failure notice and the Air Travel Trust steps in. If you are already abroad, stay put: your accommodation is bonded by ATOL, so do not pay the hotel a second time, and you will be repatriated on your original flight or replacement transport. Keep receipts for reasonable extra costs such as food and phone calls. If you have not yet travelled, claim at atol.org.uk/claim with your certificate, booking confirmation, payment receipts and correspondence. Most refunds arrive within six to twelve weeks, and you get back what you actually paid — a discounted trip refunds the discounted price. Do not rebook the same holiday elsewhere until the refund lands.

Where you paid by credit card and the cash price was over £100, up to £30,000, a Section 75 claim runs alongside ATOL rather than instead of it. Both routes stay open, but you cannot recover the same loss twice. If charges appear on your statement after the company failed, phone your card provider straight away — those are usually reversed under the chargeback rules.