The Civil Aviation Authority (CAA) has confirmed that a £300-million insurance policy for the Air Travel Trust Fund that backs the UK’s Atol customer financial protection regime is up for renewal.
The insurance covers Atol in the event of a failure by one of the UK’s biggest travel firms. The renewed policy will be provided by a panel of insurers led by Chartis (formerly AIG UK) and including Zurich Bank and Markel.
The costs of the policy have not yet been finalised, but insurance has cost the Air Travel Trust Fund about £9 million a year since 2008 when the CAA moved from financing protection primarily through tour operators providing bonds to a levy on protected bookings – the Atol Protection Contribution (APC) – now set at £2.50 per person.
A CAA spokesman said: “We are still working through the insurance renewal.” Details of the insurance would normally be published as part of the trust fund accounts in July, but are likely to be revealed earlier, in May, as part of a planned consultation on Atol reform.
The Department for Transport intends to extend licensing to retailers selling dynamic packages through a new flight-plus Atol which should increase the amount of cash going into the consumer-protection fund by between £12 million and £15 million a year.