Who would have thought a couple of years ago ATOL protection would be the highlight of so many turn-of-year campaigns – with less focus on product or price?
But that’s happened this year, and rightly so.
Our own research shows financial protection is important to 96% of holidaymakers – a 6% rise on four months ago.
Having said that, a quarter of consumers still think their money is protected when they book a scheduled or low-cost flight direct with the carrier. That’s a lot of people who still don’t understand the scheme.
The percentage of holidaymakers travelling under the ATOL scheme has declined for a number of years and 20 million of us – a third of the UK population – will book unprotected travel arrangements in 2009.
Without doubt, more travel companies will cease trading in the toughest market for many years. The focus should really be on how many holidaymakers are affected.
In my view, up to one million people will be affected by their travel provider going bust.
Most will probably get their money back, but many more won’t. Also, up to 100,000 could be stranded overseas in 2009.
This is scary stuff, and isn’t the way to create a feeling of security around our industry. The government has made it pretty clear it is not planning to widen the ATOL scheme across the industry any time soon, so scheduled and low-cost flights continue to be unprotected and, if a company goes bust, those booked with them are on their own.
Not only that, some have suggested the cost of ATOL protection contributions might increase. If it does, it will have the opposite of the desired effect. Some operators will ‘de-package’ their products, resulting in more people travelling without financial protection and putting thousands more holidaymakers’ money at risk.
This could lead to such a small proportion of the market being covered under the ATOL scheme it would become unsustainable. Longer term, the whole industry would suffer – consumers won’t feel confident in booking overseas holidays when times are tough and won’t want to part with their money too far in advance.
The industry must work together to stop that happening and educate consumers if we are to have a chance of ensuring all holidaymakers have a happy and safe new year.