How are customers affected and what can they claim back on their travel insurance?
Following the sad news that one of the most popular travel companies in the UK, Monarch Airlines has been put into administration – the media will, once more, be looking to the travel insurance industry to compensate passengers, and, once again, there will be a hue and cry when it is discovered that some people will be find themselves severely out of pocket. But are travel insurers really to blame?
Firstly, it should be pointed out that the package travel industry in the UK is regulated with regards to protecting the traveller.
Anyone who booked a package holiday with Monarch will be fully protected under the CAA’s ATOL scheme. This will arrange to bring home anyone who has travelled and is now stranded abroad and those that have yet to travel will be able to claim back the full cost of their holiday.
But, those travellers that that have booked through another tour operator who, in turn, have purchased flights from Monarch, should contact that tour operator, as it is their responsibility to make alternative arrangements for them.
Those travellers who have made their own arrangements and booked flights with Monarch, will be brought home if they are currently abroad. Those who have yet to travel will have various avenues available to them to recoup their flight costs. They can approach their credit card provider (or if they paid by debit card, their bank) and obtain a recharge form. They will not be able to claim back any other elements of their trip (hotel, car hire etc) which they have had to cancel because of the Monarch collapse.
This will then leave the people who did not pay by credit or debit card, or those that have but have not been reimbursed, to look towards getting compensation.
These customers could look to their travel insurance policies, but they should not expect to be able to claim under the conventional cancellation, curtailment or travel delay sections of the policy. Most travel policies do not provide cover under these sections for the failure of an airline, tour operator or travel agent.
The section to look out for is called either ‘Scheduled Airline Failure’ or ‘End Supplier Failure’.
If their policy has the former, they will be able to claim back the cost of their flight if they are unable to travel. If they are abroad, the policy will pay the cost of a one-way ticket (in the class you originally booked) to get them back home. But, it will not cover them for other parts of the trip.
If you have the latter then you get both the scheduled airline failure cover and the cost of any other elements of their trip (hotel, car hire etc) which you have had to cancel because of the Monarch collapse.
Postcard Travel Insurance provides end supplier failure as standard on all its policies.