Airline failures can happen with little warning.
Whether it’s
before you depart or while you’re already abroad, UK travellers benefit from some of the strongest consumer protections in the world—if you know where to look.
Here’s a clear, UK-specific guide to your rights and what to do.
Airline Ceases Trading
Before You Travel
✔️ You Booked a
Package Holiday
If you booked flights
and accommodation (or another service) together from a UK company:
- You’re protected by
ATOL
- You are entitled to:
- A
full refund, or
- A
replacement holiday/alternative flights at no extra cost
- Claims and assistance are handled via the
Civil Aviation Authority (CAA)
📄 Always check for your
ATOL Certificate—this confirms your protection.
✔️ You Booked
Flights Only
Your protection depends on how you paid:
💳 Credit Card
- Claim under
Section 75 of the Consumer Credit Act
- Covers purchases between
£100 and £30,000
- Your card provider is jointly liable if the airline fails
🏦 Debit Card
- Request a
chargeback through your bank
- Not a legal right, but commonly successful if done quickly
🛡️ Travel Insurance
- Some policies cover airline failure
- Look for Scheduled Airline Failure Insurance (SAFI)
- Basic policies often
exclude this
⚠️ Bank transfers or cash payments offer very limited protection.
Airline Ceases Trading
While You’re on Holiday
🌍 You’re on an
ATOL-Protected Package
You are
fully protected:
- You
will not be left stranded
- The CAA will:
- Arrange your
flight home, or
- Authorise alternative transport
- You should
not pay extra unless instructed
📌 Follow official guidance and keep all receipts.
🌍 You Booked
Flights Only
This is more challenging:
- The airline is no longer operating
- You will usually need to:
- Book a
new flight home yourself
- Recover the cost via:
- Credit card Section 75 claim
- Debit card chargeback
- Travel insurance (if covered)
🚫 Other airlines are
not obliged to help or rebook you.
Booked Through a
UK Travel Agent
✔️ Package Holiday via a Travel Agent
If the travel agent sold you a
package holiday (for example: flight + hotel):
- You are protected by
ATOL
- It does
not matter whether the airline fails or the agent goes out of business
- You are entitled to:
- A
full refund, or
- A
replacement holiday/flights, or
- Repatriation if already abroad
- Claims are coordinated by the
Civil Aviation Authority (CAA)
📌 Your contract is with the
travel agent or tour operator, not the airline.
✔️ Flight-Only via a Travel Agent
If the agent booked
flights only:
- ATOL protection
may still apply (check your ATOL Certificate)
- If ATOL applies:
- You can claim a
refund or
flight home
- If ATOL does
not apply:
- The agent is
not required to replace the flight
- You must rely on:
- Credit card Section 75
- Debit card chargeback
- Travel insurance
⚠️ Many online travel agents sell flights as agent-only bookings with limited responsibility—always check the small print.
Can You Claim Compensation (UK/EU261)?
In most airline collapses,
no.
- UK/EU delay and cancellation compensation relies on the airline operating
- Once an airline has ceased trading, claims are rarely successful
- Passengers become unsecured creditors in liquidation (very low recovery)
Your focus should be
refunds and repatriation, not compensation.
What UK Travellers Should Do Immediately
- Check if your booking is
ATOL-protected
- Confirm how you paid (credit card, debit card, insurance)
- Monitor updates from:
- The CAA
- Your tour operator
- Keep
all receipts and documents
- Don’t rush to rebook flights until you know who will reimburse you
How to Protect Yourself in Future (UK Advice)
- Book
package holidays where possible
- Always pay by
credit card
- Choose insurance that includes
airline failure
- Be cautious with ultra-cheap, flight-only deals
- Avoid bank transfers for flights
Final Word for UK Travellers
An airline collapse is stressful—but
UK consumer law offers strong protection, especially for package holidays and credit card payments. Knowing your rights can make the difference between being stranded and being safely brought home.
