02 July 2010

Only one- fifth of holidays protected

Only around 20% of holidays are currently protected and customers are completely confused about the level of protection on offer, a conference heard this week.

Advantage Travel Centres chief executive John McEwan, a panellist at the Barclays Travel Forum in central London, revealed the vast majority of holidaymakers travel without financial protection.

"Only about 20% of holidays are protected and there is confusion about what is covered, which is amplified when something goes wrong," he said.

"From a consumer’s point of view, it should be irrelevant how you book, you should be covered."

Fellow panellist Stephen Park, the UK general manager of Norwegian Cruise Line, said even so-called industry experts were baffled by the current laws on which holidays were covered.

Currently, those buying packages are financially protected, but people buying flights and separate elements of a holiday are often not entitled to a refund if something goes wrong, unless they pay by credit card and claim through their card company.

"People don’t know what they’re covered for and this was grossly exposed by the ash crisis," said Park. "A lot of people in the industry don’t properly understand it and I’d put my hand up to say I’m one of those."

Speaking on a pre-recorded video that was shown at the event, former Hoseasons chief executive Richard Carrick said the Civil Aviation Authority should stop pursuing its action against Travel Republic over the way the company sells holidays without an air travel organiser’s licence, and instead concentrate on improving the system of financial protection.

"The whole thing is a complete mess," he said.

Another panellist, Low Cost Travel group chief executive Paul Evans, said he did not expect the new coalition government to make any changes to the laws on financial protection in the near future.

"The confusion will continue because the government is unlikely to burden airlines with more costs in the form of bonding," he said.

McEwan added: "It has to be a level playing field - you can’t regulate more against the travel industry and leave airlines outside of the system," he said.

By Jeremy Skidmore

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Your Comments (2)

The consumer isn't bothered.

With travel now a 'commodity' and the vast majority of consumers able to get themselves home if something happens, most aren't bothered about protection. All it adds is cost to the average holiday. Nothing in life is free and I actually think that we are over protected as it is. It seems if the 20% figure is correct, so does the consumer.

By Andy Parr, Monday, July 5, 2010
Stop Whingeing-Do something

What is the point of all the hand wringing about customer financial protection 'âœ or lack of it, yet concurrently doing nothing about it. The CAA implements the EU rules and they are not now fit for purpose but at least they are trying to protect the public. The industry seems to try to avoid the CAA rules yet does not put their own alternatives in place. The Chairman of ABTA states that only 20% of holidays are now protected but ABTA have been at the forefront of dismantling their own customer protection over the last five years. We all have a duty of care to the customer and that includes a commercial and moral duty to protect customer money, the likes of ABTA, the ethical Co op and large travel groups have the wherewithal to implement their own schemes if they have such strong views about the CAA's lack of financial protection. But it costs and its inconvenient and it prevents companies from gorging on customer money but the industry has a responsibility to stop whinging and DO SOMETHING 'âœ we have. It's reputation is at stake stop the whingeing and Do IT. David Speakman Chairman Travel Counsellors

By David Speakman, Friday, July 2, 2010