Your Rights to Get Your Money Back on a Package Holiday
After Matt Hancock said that it’s unlikely people will be in a position to take holidays abroad this summer, Nick Harris, Head of Travel looks at whether you can get your money back from your package holiday provider.
What if My Package Holiday’s Been Cancelled?
If your holiday has been cancelled, the law says you have the right to a refund within two weeks of the cancellation.
But, because of Coronavirus, many holiday companies are saying they can’t process refunds in this time because so many of their staff have been furloughed and because of the number of people wanting refunds.
Instead, some are offering vouchers for the value of the holiday or sometimes more so you can book a holiday once lockdown has been lifted and are only offering a refund if you call them to request one.
There are many reasons why you may not want to accept a voucher instead of a full refund.
Your financial situation may have changed and you may need the money back because you’ve been furloughed or lost your income because of Coronavirus.
It’s not absolutely clear if these vouchers are covered by the ATOL and ABTA schemes, which protect you if your tour operator stops trading. If you accept a voucher now and the holiday company you’ve booked with goes bust, do you have any protection?
These factors may have an impact on whether or not you want to accept a voucher or not, but you do have other ways to try and get your money back.
If you booked your package holiday with your credit card, you could ask for a chargeback. A chargeback is where your credit card company asks for the money back from the travel company’s bank. This shouldn’t be difficult if the holiday has been cancelled.
If a chargeback can’t be done, you could ask to make a claim under ‘Section 75’. This is where you ask the credit card company to cover you for an amount of over £100 but under £30,000. This may not be as straightforward as a chargeback, but is another option.
You should remember that you have a right to a refund by law. You may need to be very persistent to actually get one though.
My advice is to always consider using your credit card when buying any goods or services costing between £100.01p and £30,000. You only need to pay a tiny amount on your credit card to get great protection.
This protection means that if the goods are faulty or services not provided or the company providing them goes bust, you have the same rights against your credit card provider as you would have against the company. Have a look at section 75 of the Consumer Credit Act.
Can I Cancel My Package Holiday and Still Get My Money Back?
This is a difficult one and really depends on the Foreign and Commonwealth Office (FCO) guidance. The FCO have advised against all non-essential travel indefinitely, but until your holiday company cancels your holiday, you probably won’t get your money back. Your holiday company may say that FCO guidance is changing all the time and until it’s impossible to provide your holiday, they probably won’t offer to refund your money.
Whilst unlikely that many holidays will go ahead this year, if you cancel your holiday then your holiday company may say that you are not entitled to a refund because you ended the holiday contract.
You may be able to cancel your trip and get your money back but you should speak to your holiday company first because many are offering different options.
Lots of tour operators have cancelled holidays into June, so you should be receiving a refund or your insurance should pay up if you have been affected.
But, if you’re not due to travel for a few months you should wait before making a decision. Things are changing very quickly and an early cancellation could mean that you’re not covered by your travel insurance, particularly if the FCO advice changes.
I’ve Only Paid a Deposit. Should I Pay in Full?
This is a really difficult decision to make.
You could pay in full and find that restrictions are lifted before you travel and you can go on your holiday as planned.
If the lockdown is still in place and your holiday is cancelled, you are entitled to a full refund by law. If your holiday isn’t cancelled, but the Foreign Office has a travel warning in place, your travel insurance could cover the cost.
You may struggle to get a refund from your tour operator if you do pay in full though and if you choose not to travel once restrictions are lifted, your insurance wouldn’t pay out either.
But if you don’t pay the balance of your holiday and your holiday company hasn’t cancelled your holiday, you’re effectively cancelling the holiday and will probably lose your deposit.
You can see there isn’t much ‘concrete’ advice at the moment as holiday companies are all dealing with the situation differently, but hopefully this has given you some idea of what your rights are as a consumer.
For more advice and information about your rights we will be publishing further guidance on our website.
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