Consumer rights: Your rights regarding holiday refunds arising from Covid-19
Covid-19 has thrown a real spanner in the works for everyone’s 2020 plans, from weddings, big trips abroad, live music events, parties… the list goes on. When we will be able to get back to having such events as normal remains to be seen and until then, it is a bit of a grey area as to where people stand as the position is constantly changing.
Readers should therefore be warned that travel abroad during this uncertain time can be incredibly risky, as border restrictions can and are changing at short notice, particularly as some parts of the world are now experiencing second spikes in new cases of Covid-19 and specific areas are being placed back into lockdowns.
What is the current position?
The Foreign and Commonwealth Office (FCO) issues UK citizens with advice on where it is safe to travel abroad. As from 4 July 2020, the FCO guidance has changed from advising against all but essential travel to all overseas destinations, to now providing a list of exempt countries where travel is now permitted. This can be found here: https://www.gov.uk/foreign-travel-advice
The current FCO advice also requires British travellers to self-isolate for 14 days on their return from a holiday abroad, which is due to change as of 10 July 2020 again for some exempted countries.
We would advise checking the FCO guidance before you travel, to be certain.
What if I need to cancel my holiday?
If you need to cancel a holiday booked for the immediate future, we would recommend you:
1. Check the terms of your holiday booking first. Many bookings will state that if you cancel the holiday purely due to ‘disinclination to travel’, you will forfeit the deposit or balance you have paid as at the date you cancel and won’t be entitled to a refund. Instead, wait for your travel company to cancel the holiday and this way, you should be entitled to a refund.
If you are shielding and unable to travel, it is worth contacting your holiday provider to explain this. Some companies are being accommodating and allowing customers to amend bookings. However they are not, obliged to do so. Alternatively, travel insurance may provide cover for such circumstances.
2. Check the terms of your travel insurance policy: if you plan to travel abroad, check the terms of your policy or if you haven’t purchased it yet, obtain travel insurance ASAP. Note however that many insurers may not provide cover for Covid-19-related cancellations. If your trip isn’t cancelled but FCO guidance remains in place advising against travel, for insurance policies purchased prior to mid-March 2020, it may be possible to claim on your insurance policy. You will need to contact your insurer and check your terms and conditions of your policy though, to be certain.
If you decide to travel abroad to a destination despite FCO guidance avoiding against travel to that country, it is possible your insurers may refuse to pay out for any subsequent claim.
My holiday has been cancelled. What is the law and where do I stand now?
Check whether your holiday is a package travel or linked travel arrangement falling within the Package Travel and Linked Travel Regulations 2018. The Regulations apply to trips booked on or after 1 July 2018 sold or offered for sale in the UK. For the trip to be classed as a ‘package holiday’ there is specific criteria that applies but generally, it must include at least 2 components, transport, accommodation or excursions.
Under Section 14 of the Package Travel and Linked Travel Regulations 2018, the travel organiser (usually a travel agent) is usually required to reimburse or refund the traveller within 14 days after the contract is terminated. Understandably at present, there is a significant backlog in claims being processed within the usual 14 day timescale due to the current unprecedented situation.
Your travel provider may decide to offer you either a refund or travel credit refund note for the amount you have paid. However, this is not guaranteed (especially now that some flights are now starting again), unless there is specific FCO guidance in force advising against travel to that particular destination. From experience based on enquiries we have received, there is no uniformed approach on how each travel provider approaches the refund/credit policies.
What financial protection do I have with a travel credit?
Many clients have asked what protection is provided to them if they accept a travel credit and the airline or travel company becomes insolvent as understandably, this is a massive concern during such unprecedented times.
If you have been offered a travel credit, you are not obliged to accept this. If, however, you are content to wait, you can do so, knowing that you will have financial protection for the amount paid under your booking.
ABTA have confirmed that the European Commission have now endorsed the issue of financially protected Refund Credit Notes, meaning that these credit notes will provide customers with the same protection as they would have had under the original holiday booking.
For a flight package, ATOL protection will be retained and for a non-flight package, ABTA protection will be applicable. Both forms of protection entitle you to submit a claim to recover the cost paid for your holiday in the event that a travel provider enters into a form of insolvency, meaning it is unable to continue trading.
Useful guidance is provided below as to what protection is provided:
How can Ellis Jones help you?
Contracts and terms and conditions can sometimes be lengthy and contain a lot of jargon that sometimes isn’t clear or easy to navigate. Customers can feel pressured into accepting holiday vouchers, which do not provide the same protection as Refund Credit Notes and are therefore risky to accept.
Ellis Jones Solicitors can provide specialist advice by reviewing the terms of your booking and/or insurance policy, to determine what options you have. Some companies have specific complaints procedures or Alternative Dispute Resolution processes that they ask you to follow as part of their complaints process, which we can advise you on.
Should you wish to obtain initial advice on how we can help you further, please do not hesitate to contact our specialist Dispute Resolution team on 01202 525333 or Maria.Redman@ellisjones.co.uk.