Aito calls for Abta support to close legal loophole

The Association of Independent Tour Operators has issued a plea for support from trade bodies including Abta after suspending its 100% financial protection guarantee to customers.

The call comes as the organisation sends out a letter to clarify the situation and reassure members following the withdrawal of its guarantee on August 1. The letter has already been sent to 130 Aito Specialist Travel Agents and will be sent to 150 tour operator members this week.

Aito withdrew its pledge after insurer AmTrust Europe voided a policy on the grounds of “material non-disclosure” by the company insured, former Aito member Skiing Europe. It believes the move highlighted a loophole in the Package Travel Regulations, allowing the insurer to take this action.

Aito chairman Derek Moore stressed that association members’ financial protection policies remain in place. But he said the organisation would welcome a united approach from the trade to close a loophole in the regulations. Twenty three Aito tour operators offer the type of failure insurance similar to that withdrawn by AmTrust Europe.

Moore said: “It’s disappointing so far that we have not heard from the Abta chairman. We hope the wider trade will involve themselves in this issue. It would be helpful to receive some supportive comments from Abta along with heads of other trade bodies. We would like this loophole closed.”

He warned: “The ramifications of what Aito has discovered could ripple through the trade.”

Aito is currently liasing with insurers which offer failure insurance policies to its members. It hopes to reinistate its guarantee by October.

The organisation introduced its 100% financial protection guarantee two years ago. Moore said: “Under the guarantee we go beyond the law. If you sell a single service such as accommodation-only, the law does not require bonding, but Aito does.”



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