AAC calls for end to ATOL protection contribution
The Association of ATOL Companies has suggested to the Department for Transport that the current financial protection scheme for flight-inclusive holidays be replaced by insurance.
It also suggested in its response to the DfT’s Call for Evidence on the Future of Financial Protection that regulation in the UK is reduced to a single regulator to reduce costs and simplify consumer protection.
In its proposal submitted today, the AAC said an insurance scheme should cost no more than the existing £2.50 per passenger ATOL Protection Contribution.
It said the ATOL holder could take a commercial decision as to whether to absorb the cost of the insurance premiums themselves or pass the cost on to the customer.
Chair Lindsay Ingram said: "We have worked hard to find a viable and simple alternative that matches the government’s wish to be rid of its potential liability and we are grateful to our Premier Partner Giles Insurance for their efforts in reaching this solution"
The AAC said it had carried out a detailed consultation with its members, 95% of whom supported a single regulator rather than the multiple regulators that exist at present.
Alan Bowen, legal adviser to the AAC, added; "Our proposals are aimed at reducing costs to our members, simplifying the consumer guarantee of financial protection and ensuring effective licencing.
"Over 70% of our members support the idea that the CAA should expand its role to regulate non-air travel and 95% support the idea of an insurance backed scheme".
The AAC said it had ensured that the insurance proposals would withstand scrutiny and called on the DfT to press ahead with changes "as soon as possible".
The AAC also suggested all businesses that must protect consumer funds should be licensed, and that alternative schemes such as trust accounts be allowed, but only under strict guidelines.
The Call for Evidence closes on August 15.
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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