What are my rights if the airline I have booked with goes bust?

It is the time of year when airline staff anxiously await news on whether they will survive until the new year.

After the peak season has died down, airlines are left with mounting bills but decreasing passenger numbers.

Monarch Airlines, for instance, has been granted a reprieve of sorts and is expected to receive new investment. But what are your rights if an airline you have booked with goes bust?

Flights, flights, flights:

As long as the airline you were due to travel with is protected by ATOL, you will get your money back. The same rule applies if you have booked a package deal. If you are stranded abroad, the ATOL fund should cover your flights home. The Civil Aviation Association (CAA) in the UK will often prepare for the worst by organising a ghost schedule. If they suspect that an airline is set to go down the pan, they will arrange for shadow flights to operate on the same or an as close as possible flight plan to the one of the now defunct airline. They will ensure that all passengers are put on flights to the UK.  

If you are not covered by some form of insurance, rival airlines will often offer you a cheap flight, if they have space available and if you can prove you should have been on a flight with an airline that has gone bankrupt.

Location, location, location:

If booked separately from the rest of your trip, an airline going bust could sadly mean that you lose out on what you have spent on accommodation. Whether it is a hotel, b’n’b, villa, hostel or Airbnb, the attitude of those you have booked with will be that the airline going bust is not their problem. Their stance will be that the accommodation you have booked remains and the issue of getting there is yours and yours alone. However, you may be able to claim back the money, depending on the type of insurance you have taken out.

Consequences of airlines going bust:


Other than the ones already mentioned, the main consequence of an airline going bust is the fact you will be forced to pay more in attempting to re-book your holiday. This is particularly the case when flying at a peak time such as half term or at Christmas. Sadly, other tour companies and airlines are likely to take advantage and hike up the cost.

Like what you've been reading? Check out our blog for the latest stories or follow us onFacebookTwitter or Instagram.