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Airlines should protect passengers

Travellers out of pocket if airlines go bust

[August 6th 2008]

Flights cancelled

Scheduled airlines should offer the same protection to travellers as ATOL protected tour operators says a government advisory committee.

The call by the Air Travel Insolvency Protection Advisory Committee (ATIPAC) comes in the face of an airline crisis in which more airlines risk bankruptcy as they are hit by rising oil prices and lower passenger demand.

Customers of ATOL registered tour operators are protected through the £1 per passenger ATOL Protection Contribution (APC) which the tour operators have to pay. By contrast, passengers with scheduled airlines are not protected so they would not get a refund if an airline went bust and would have to pay their own repatriation fees.

“Airlines are not providing suitable protection and advice for their passengers. Information about financial protection is negligible and, in the event of an airline failing, passengers often have no choice but to pay their own repatriation costs. Those yet to travel will often have to pay for replacement flights or face losing the value of any pre-paid element of their holiday,” says ATIPAC chairman, John Cox.

“Passengers travelling with an ATOL-protected tour operator face none of these risks and will be repatriated at no additional cost or receive a full refund if they have yet to travel, should their tour operator cease trading,” Cox adds.

“This two-tier protection system must not be allowed to continue and the Committee reiterates its call for airlines to be brought into a financial protection scheme,” he concludes.

ATIPAC says the failures of the business airlines Silverjet, Maxjet and Eos earlier this year demonstrate the significant financial loss passengers can be exposed to in the event of an airline going out of business.

In June the Federation of Tour Operators also called for the APC to be extended to airline passengers. It is believed that some airlines have mounted strong lobbying campaigns to try to persuade the government not to extend the scheme to airlines.

Written by: Nick Purdom


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