What to Do if Your Airline Goes Bust?

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Airline Bust

What should you do if your airline goes bust? Read our page to find out what you can do and if you're entitled to any money back.

My Airline Has Gone Bust, What Should I Do?

If your airline has gone bust, don't panic completely! Depending on the airline's situation and the payment method that you chose to pay for your flights, you might be entitled to some money back. If you've purchased your flights with Alternative Airlines and we receive a refund from the airline, we'll always refund the money back to you.

 

Travel Insurance

Check your travel insurance. If you've taken out comprehensive cover, you'll most likely be covered by the insurance company and will be able to claim some or all of your money back. Admittedly, it's rare that travel insurance will cover a bust airline as standard, however, by contacting your insurance provider before booking the flight, you should be able to arrange something with them if you're making a big flight purchase and want peace of mind. 

 

ATOL Protection

ATOL protection is a UK government-backed scheme that ensures that when you book your flights through a UK-based travel company, you will never be stranded abroad if your airline goes bust. As long as the airline or travel agency that you've booked with is ATOL protected (most are), any additional flight that you have to purchase will be covered.

Most ATOL protected travel agencies will state that they're ATOL protected in their terms and conditions. If you're unsure, just ask the agency that you're booking with.

Alternative Airlines is ATOL protected, as shown by the icon on our website. However, please be aware that ATOL protection very rarely covers flight-only bookings.

 

Credit Card

If you've purchased your flight via credit card, you might be able to claim your money back through your credit card company. Most credit card companies will refund you any purchase that is between $100USD–$30,000 USD. However, it's important to note that different countries have different rules.

In the UK, it's much easier to claim money back off your credit company if an airline goes bust, as people in the UK are protected by Section 75 of the UK Consumer Credit Act. You'll first need to try and contact the airline or travel company that you booked with to see if there's anything that they can do. If you can't get an answer because the company has gone into liquidation, you'll then have to write to your credit card company, requesting a refund under Section 75 of the UK Consumer Credit Act.

In the US, it's fairly similar. Although the US law under Section 170 of the Fair Credit Billing act doesn't force credit card companies to protect and refund purchases, in almost all cases, credit card companies will refund flight purchases if the airline has gone bust. 

 

Raise a Chargeback

If you have made your flight purchase with a debit card, you won't be protected by law. However, many major card providers, such as Visa, Mastercard, and American Express have schemes in place that will get you your money back if your airline goes bust and you don't get to use your flight. This is called a chargeback. 

However, this will completely depend on the airline's situation. A chargeback reverses the transaction from the airline to your debit card. If the airline has gone into liquidation and is completely out of money, you're unlikely to receive a refund. Chargebacks can also take considerably longer than other refunds, with a timeframe of between 45–120 days for the money to show in your account.