Travel insurance and tour operators going out of business

This article talks about how one UK travel company, Goldtrail Travel, stopped doing business a few days ago. Some travelers got stranded and other found themselves with ruined summer vacation plans. The good news is that in Europe everyone is protected:

“The good news in this sorry affair is that all these people should get their money back under a European “Package Travel Directive”.

But what if the same thing were to happen in the US? If travelers paid by credit card or have travel insurance they might be able to get their money back but I doubt everyone would be automatically protected. Well, even in Europe only people who book through tour operators are protected. If you book a flight on your own (or hotel or whatever) than you would have to depend on the credit card company or the travel insurance.

You may also be covered under any travel insurance you have, but you’ll need to check the terms of the policy to make sure. While a travel insurance policy can cover you for an airline going bust, some policies are better than others. Check your insurance has scheduled airline failure cover, for example.

Here’s where things can get tricky. I’m not sure but I bet many of these travel insurance contracts are not short and simple.

HBF, an Australian travel insurance provider, has these tips. They also say you need to know the details of your policy. I’m pretty used to skipping the fine print but it seems with travel insurance you have to do some reading. The only time I used travel insurance I was booking an expensive cruise to Alaska through a travel agent and she took care of the insurance stuff. Who knows what I was covered for and what I wasn’t?

Filed Under: Travel insurance

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