Earlier today it was announced that travel company Thomas Cook could go bust as early as this weekend, leaving thousands of customers worried about losing their hard-earned cash. The firm announced a pre-tax loss of almost £1.5bn in the six months leading up to March, with its value going down from £2.2 billion to just £180 million in a year. The potential collapse is mainly down to the rise of online stores.
So, what does this mean for the people who have already booked a holiday with Thomas Cook?
Fortunately, anyone who has booked a package holiday is covered by ATOL protection - a scheme that protects people when booking holidays.
If a travel company with ATOL protection ceases trading, the scheme protects customers who had booked through them, which means they are guaranteed not to get stranded abroad, or to lose money through no fault of their own.
Advert
Speaking to The Sun, Martyn James, a money expert, said: "When you book a holiday you enter into a contract - so if another business takes over then your holiday transfers over to the new owners and you shouldn't experience any problems.
"However, it pays to know your rights if a mistake or problem occurs.
"If the firm changes something about the holiday significantly (like the dates, hotel, flights) then you should be able to cancel without penalty - though I'd expect them to come up with a suitable alternative."
He added: "However, always take out a good travel insurance policy - and make sure it begins from the moment you book, so you're covered if you can't travel for any reason."
Advert
Thomas Cook confirmed this by adding: "Thomas Cook Tour Operations holds ATOL number 1179, so when you book with us you can be confident you're fully financially protected"
Unfortunately ATOL protection doesn't apply in the case of people booking flights and accommodation separately, it's only package holidays.
If this includes you, you should contact your credit card company or travel insurer. If you have travel insurance and check your policy for the phrase "airline failure".
If you paid by credit card and your booking cost was between £100 and £30,000, you may be able to make a claim under section 75 Consumer Credit Act.
Advert
Money saving expert, Martin Lewis said: "While it's not a legal protection like Section 75, this is a core protection in Visa, Mastercard and American Express' rules and it can swiftly help people get their money back,"
If successful, your credit card will refund your money.
If you're looking to book a replacement summer holiday, you'll be happy to know that Easyjet has just released flights for 2020.
Advert
Topics: World News, UK News, holidays, Money, Thomas Cook, travel, Flights