Thomas Cook collapse: can I get compensation?

The collapse of Thomas Cook this week left 150,000 British holidaymakers needing to be repatriated, with hundreds of thousands of others losing the holidays they booked to take this autumn or later.

The UK’s Civil Aviation Authority (CAA) is in the process of bringing all UK travellers home via Operation Matterhorn, which will continue until October 6. But the focus is now shifting from repatriation to compensation as hundreds of thousands of customers work out how to get their money back.

Thomas Cook’s failure presents the biggest test for the Air Travel Organiser’s Licence scheme (Atol), the financial protection scheme funded by the travel industry, and administered by the CAA.

Although those who have booked a package holiday will be entitled to their money back via the Atol guarantee, they face a long wait — potentially 60 days or more. Others who have booked flight-only deals will have to recourse to their bank or credit card provider.

Action Fraud, the national fraud reporting service, is warning people to be wary of scammers pretending to act on behalf of Thomas Cook. There have been several reports of people across the country receiving calls, texts and social media messages that ask for your details.

In a statement it said: “We would urge people….not to automatically click on the links in unexpected emails. Legitimate organisations will never contact you out of the blue and ask for your Pin, card details, or full banking passwords. If you get a call or message asking for these, it’s a scam.”

When will I hear about my flight home?
Holidaymakers will be offered flights home as close to their original departure date as possible, and will be able to find details on the dedicated CAA website up to 72 hours before their departure. Holidaymakers abroad are being advised that they should not make their way to the airport until they are notified. They are advised to visit thomascook.caa.co.uk or call (44) 1753 330 330 from their holiday resort. The UK freephone number is 0300 303 2800.

I’m on a Thomas Cook holiday and my hotel is demanding payment — what should I do?

Holidaymakers who paid for a package holiday are covered by the Atol insurance and should not pay hotels. The CAA has issued guarantees for payments to 3,000 hotels since Thomas Cook went into liquidation on Monday.

The CAA advises any holidaymakers in this situation to ring its hotline or visit the dedicated website (above).

If the holiday is not Atol protected, because the hotel and flights were booked separately, any Thomas Cook accommodation should still be covered by the Association of British Travel Agents’ financial protection scheme. Its emergency helpline is 0330 135 9665.

What happens to future Thomas Cook package holidays bookings?
Most future holiday packages are cancelled, but the CAA says refund arrangements for Atol customers should be detailed by Monday September 30. However, holidaymakers will have to wait to get their money back — the CAA said claims should be paid within two months of claims being submitted. Compensation should cover the flights, accommodation and booked excursions. To claim, customers will need to provide their Atol certificate and evidence of payments, for example bank statements.

Atol may ask other travel companies to provide holidays for travellers booked further in the future.

If other specialist costs, such as weddings or sports events, are rejected by Atol, then travel insurance or credit and debit card companies may pay.

I have booked through a Thomas Cook shop for a holiday with another company. Will that be cancelled?
The Association of British Travel Agents (Abta) said that people who have booked through Thomas Cook stores for other holiday companies are likely still to be able to travel, but should check with the company they are booked with.

Will I get enough to pay for a new holiday to the same destination?
The compensation should cover the cost of the cancelled holiday under Atol protection. If costs increase because of a shortage of available holidays — as huge numbers of customers are already reporting on social media — the extra will not be covered. Some travel insurance policies will pay for the cost of new travel arrangements (see below).

What happens to future flights?
Most insurance policies do not cover flight-only bookings. If you paid for your holiday flight with a credit card and it cost more than £100 you should be able to make a claim from your card issuer under Section 75 of the Consumer Credit Act. If you paid on a debit card, it is possible that you can make a claim from your bank under “chargeback” rules.

I booked my flight through an aggregator website — will they refund me?

This is proving to be a tricky area. Those who have booked a hotel or flight via a third party will have difficulty making a Section 75 or chargeback claim if things go wrong as, technically, there must be a direct link between the customer and the holiday company.

Expedia’s website says: “If you have booked a standalone flight with Thomas Cook Airlines and are yet to travel, please contact your credit card company to initiate a refund request. Expedia are unable to directly issue a refund for your standalone booking.”

Lastminute.com is advising customers on its website: “If you have made a flight-only booking to fly with Thomas Cook Airlines and are yet to travel, we will request a refund of your ticket. We’ll email you as soon as this has been processed, although please be patient, as this takes at least 60 days.”

Will travel insurers pay compensation for the failure of travel companies?
Travel policies vary, so holidaymakers will need to check the small print of their policies. About half will not pay out for the collapse of a travel company or airline. Policies that do will have a section on “scheduled airline failure insurance” or “end supplier failure”. Generally more expensive policies offer this cover.

Some policies with travel disruption cover will “cover the cost of new travel arrangements”, according to the Association of British Insurers.

Will Thomas Cook vouchers and gift cards be honoured?
It is likely these will be worthless, but anyone who paid by credit card for vouchers worth more than £100 should be able to claim from their card provider. Debit cards may pay out for lower amounts. It is likely that debit card providers will have held back more money owed to Thomas Cook in recent weeks, as the company’s future looked uncertain.

Will I still be able to use pre-paid currency cards?
Although Lyk cards were sold by Thomas Cook, these financial products are provided by Wirecard, protected by Mastercard and can still be spent or cashed in under the rules of the cards.

What if I have already bought my currency but can no longer go on holiday?
Post Office Travel Money, which accounts for a quarter of holiday currency purchases, has confirmed that none of its customers who purchased holiday cash will be out of pocket because of travel cancellations. Post Office branches will offer full refunds on cash.