Restrictions on travel and concerns about the coronavirus pandemic may have affected your holiday plans for the summer months. There’s been a lot of contradictory information about what you’re entitled to and if you must cancel. So Andy Knight, Chartered Financial Planner at Pembroke Financial Services, takes a look at what your rights are and what your next steps should be if you’re affected.
Andy commented: “Most people with travel plans in the next few months have had to abandon them. The Foreign Office currently advises against all non-essential travel, whether you’d been planning to visit a destination in the UK or abroad. On top of this, several countries have also, in effect, closed their borders and have stringent restrictions in place.
“Even if the borders are open at your chosen destination, it’s likely restrictions and social distancing measures are still in place. It may mean that whilst you’d be able to get there, the activities you’d been looking forward to are no longer possible.
“If you’ve yet to book a summer holiday but had hoped to, it’s strongly advised that you delay for a few months whilst the uncertainty remains.”
So, if you already have a holiday booked, are you entitled to a refund? This will depend on how you’ve booked your holiday, where you’d planned to go and the travel insurance you’ve taken out.
If you booked a package holiday, you are entitled to a refund under current rules if it’s cancelled due to coronavirus. However, the Travel Association ABTA is calling on the government to make temporary changes as it argues the protection wasn’t designed to cope with current demands.
Andy says: “Whilst you should be issued a refund if your package holiday has been cancelled due to coronavirus, some consumers are finding they’re being refused. This is because, in the wake of thousands of holidaymakers asking for refunds, many companies are going to struggle. They may offer you a voucher or credit note instead. You don’t have to accept this; you’re legally entitled to a refund if you want it.”
Keep in mind that some firms aren’t cancelling holidays far in advance. If your holiday isn’t for a few months, you’ll likely have to wait to see how the situation develops before a travel company will issue a refund. Some firms are cancelling holidays just three weeks in advance.
Flights are a little more complicated and will depend on the airline.
Andy explains: “The good news is that all flights, on any airline from an EU country, as well as Iceland, Norway, Switzerland and the UK, and any flights on any EU carrier from any airport are liable for a refund. If this applies to you, contact the carrier directly, to start a claim. Some firms are dealing with this better than others, but delays in responses and getting through to a customer service team should be anticipated.
“As with package holidays, some airlines that should be offering refunds under the EU rules are refusing to give them or insisting customers accept vouchers. Again, you are entitled to a refund by law.
“Outside of the EU, refunds will likely depend on the individual airline and travel agent’s, so check their terms and conditions and get in touch.”
If your hotel has closed and is unable to deliver the service promised, you’ll be entitled to a refund.
However, if you need to cancel accommodation due to not being able to reach the destination or for other reasons, a refund will be reliant on the goodwill of the hotel or website you have booked with. Many major hotel chains and booking platforms, such as Booking.com and Airbnb, have waivered their cancellation fees but there’s no obligation to do so.
Finally, if you already had travel insurance in place before the coronavirus pandemic, you should be protected if you’re acting in line with advice given by the Foreign Office.
“Be sure to check what your individual policy covers and seek a refund from providers first. However, as a last port of call, travel insurance may cover the costs that can’t be refunded, this may also include the costs of transfers and excursions. If your travel operator tells you to claim on insurance, ask for this in writing,” Andy comments.
If you don’t have travel insurance, it’s too late to get a policy that will cover you for coronavirus-related claims as providers have updated their terms and conditions.
Your next steps
If your holiday is being cancelled or you’d like to cancel it, your first step should be to get in touch with the providers. Many travel companies are offering the opportunity to postpone trips and are not taking bookings until later in the year or until 2021 in some cases. Speaking to them directly can help you understand what your options are.
However, this may be easier said than done. Unsurprisingly, customer service teams are dealing with large numbers of enquiries, whilst also managing with fewer staff due to social distancing measures. So, expect to be waiting a while for a response, whether you call or email. Many companies are working through the bookings in date order, so those with holidays in a few months may be forced to wait several weeks whilst the situation is assessed.
If you don’t have much luck with the provider, then contact your travel insurance company. Again, expect long delays before your query is resolved.
Where a refund isn’t possible, Andy explains there may be another option: “Chargeback also offers an alternative solution if you paid for parts of your holiday by credit card. Paying by credit card gives you added legal protection if the company you’re buying from doesn’t deliver what’s promised, in this case, a holiday. Section 75 of the Consumer Credit Act covers goods or a holiday costing over £100 and up to £30,000. You don’t need to pay the full price by credit card, paying the deposit is enough to get your legal protection.
“To receive a chargeback, you should try to contact the travel company first. If they don’t respond or refuse a refund, write to your credit card company, stating what you bought, along with proof of purchase, and that you’d like to refund the purchase price into your credit card account.”