After the news of Flybmi going bust – would you know your rights when your holiday flights disappear?

In recent years low cost airlines such as Primera Air and Monarch have disappeared, and now Flybmi, so the risk of losing your flights is very high for the UK traveller.

Travel Insurance Explained has the answers on how to mitigate the risk and not lose out when these closures happen.

Top tips to ensure you don’t lose out if your airline goes bust

Flybmi, the UK regional airline offering flights to 25 European cities, announced that it will be ceasing all operations, blaming rising fuel costs and the uncertainty surrounding Brexit for its insolvency.

The airline which has a fleet of 17 and employs 376 members of staff has said they had no choice but to file for bankruptcy. Thousands of passengers have been left stranded abroad or unable to reach their holiday destination and many more have been left out of pocket, but it is unlikely those affected will be able to claim back any compensation.

But how can you protect yourself against something like this happening again in the future?

What if I have booked a package holiday and my flight was cancelled?

If you book your holiday as part of a package holiday you should be covered under ATOL protection. Travel agents and tour operators should offer an alternative flight with another airline. This will be solely down to the company so be sure to check with your package provider, when buying your holiday, what the situation would be should they book you with an airline that goes bust.

If I brought my airline tickets using a credit card; would I get my money back?

By paying for flights with a credit or visa card you may be able to claim back the cost of any unused tickets. Under Section 75 of the Consumer Credit Act 1974 consumers should be protected, but you will need to check with your individual provider.

Should I have a travel insurance policy to cover an airline going bust?

It is always advisable to look for a travel insurance policy that would cover you for ‘Scheduled Airline Failure’, however it is worth noting this is not usually covered as standard therefore you may need to pay an additional premium when you purchase the policy to ensure this additional cover.

In the event of your airline going bust, those with Scheduled Airline Failure who have not yet left the UK will be able to claim back the cost of the flight from their travel insurer, provided the money cannot be refunded from anywhere else. Passengers who are already abroad would be able to claim back the cost of a flight home.

Even with Scheduled Airline Failure, travel insurance will not cover if the policy was purchased after the company has declared bankruptcy or announced it would be going into liquidation, so you can’t buy a policy now to cover you for the Flybmi situation.

I always book my travel independently, not through a package holiday, what should I should I do to protect myself?

Booking your holiday in individual parts may save you some money, but it means you will not be protected by the Package Travel Regulations. Therefore, you would need to ensure that you bought a travel insurance policy which would offer you some extra protection, remember not all travel insurance policies are the same, some can have very limited cover. Our advice is if you are booking an independent holiday ensure you have a policy which offers the following cover:

- Scheduled Airline Failure cover

- Force Majeure cover

- Cover for delay on your homeward journey

- Cancelation for anything which you could not have been expected to foresee or avoid

It is worth noting that there are only a very few insurance policies that offer cancellation cover for ‘any reason you could not have been expected to foresee or avoid’. If you have this cover, you may be able to cancel your holiday and claim back any pre-paid expenses, such as excursions, car hire costs or accommodation fees that you cannot get back from anywhere else.