What to do When Your Vacation Provider Goes Bust at the Last Minute

Going on vacation is a stressful experience at the best of times, and any disruption is bad but what would happen if your vacation provider went out of business? It may sound unrealistic but it does happen, the huge British firm Thomas Cook went out of business earlier this year and having been in business since 1841 this brought to a sudden end after 178 years of providing vacations. You may be thinking how does this affect us though? Well aside from showing that it can happen to any size of firm and going with an established name does not fully protect you, and that the fall of a firm like Thomas Cook can have knock-on effects worldwide for prices that affect all travelers.

Check Your Insurance

Your travel insurance provider should be contacted in the first instance as you will quite possibly have to claim compensation if the whole vacation has been paid for already. You need to check that cancellation is covered in your package as well. These are the kind of things that are often overlooked on cheaper policies and if they are not included it is often included only in the small print, you never think that stuff like this might happen and when it comes to claiming it’s too late. Even if you can claim you need to know what you can claim for and, more importantly, how quickly the claim will take? For if you are going to have to wait weeks for the process to complete then you are not going to be able to use the reimbursement in time to help you now.

Are You on a Package Deal or Just Travelling?

As we just discussed large package deal providers can go bust, but the one advantage that you have if everything is booked under one firm is that it is much easier to know who is responsible for sorting things out. To clarify something from the last point travel insurance, like any other form of insurance can be tricky and they don’t like paying out. So if you are looking at everything being canceled, including travel, accommodation and even entertainment then you can rest a little easier knowing that the insurer will reimburse you for the whole lost vacation. Where the situation becomes a little less clear is where only one part of your trip has been organized by the company that went bust. Let’s say, for example, that your airline goes out of business, and you have a 2nd flight by another airline and a hotel booking through someone else. In this situation then you may only be able to be compensated for the first flight, but what if that makes you miss the next flight and half your hotel booking? This is where you find an insurer often says, sorry, bad luck.

Try to Rearrange the Vacation in Another Way

One thing that you can take for sure is that you are not going to be able to take the vacation as you have booked it and how you have planned it. But this doesn’t necessarily mean that you are not going to be able to take the vacation as originally planned. The destination resort or hotel will most likely not be able to take you on the original booking as it’s unlikely they have already been paid for it, although it’s worth contacting them directly to check and ask the question. Even if they say the booking is null and void due to the booking company not trading anymore you may be able to barter with them and get a deal on re-booking the room directly, you may get this at a lesser price and if you can recover the original price via insurance you could luck out. If this is not possible you may just want to look at a new destination entirely? This could present it’s own challenges as well, visas to travel and last minute vaccinations from PharmaVaccs travel clinics are all things you’d want to arrange if you decide to do this. Bear in mind you will need the funds to effectively pay twice until your insurance money comes through.

Try to Contact Them

Although a company is going out of business they will usually have some staff retained to deal with the aftermath of the company administration as it winds up. They may have some funds available to help out or offer some kind of advice as to what id happening with the company. Even if it’s further down the line you should remain vigilant and track what is happening with the collapse as you are now, legally speaking, a creditor, basically someone the company owes money to. As a creditor, you will be entitled to a portion of any remaining assets the company has as it comes to be liquidated, and this will be a % of what you were owed, this is worked out by the liquidator based on the number of creditors, what they are owed and what assets exist.

If You Are Already There

This advice changes drastically if you are already in the middle of your vacation when the company goes bust. The feeling of panic that a traveler feels when in a foreign country and not knowing if their flights or accommodation are paid for or are even still booked can be immense. Check first of all with your hotel and phone the airline to see if you can stay the remainder and get home. If it is bad news and you are not covered then you can simply pay up to get new flights and chase the compensation later, but not everyone can afford this. If you are stuck contact your local embassy and see if there is a plan from your government to get you home.

Check Social Media 

There are always a lot of others in your situation when this happens so check social media. Others will have info and news and support groups are often formed. You can also bet that these days this is where a struggling company will often communicate, you’re more likely now to see a tweet rather than a press conference.