Warning over Low Cost Holidays' financial protectionCAA warns of consumers being stranded abroad

18 December 2013

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Consumers who book with online travel agent Low Cost Holidays may not have any financial protection because of the company's move to Spain, the Civil Aviation Authority (CAA) has warned.

The CAA has launched a legal investigation into Low Cost Holidays and has warned that passengers who book with the agent may be stranded abroad should a company fail while they are on holiday.

The move to investigate Low Cost Holidays follows its move from the UK to Spain in November this year. Since the company no longer operates from the UK, any bookings made with it are no longer protected by ATOL – the UK’s holiday financial protection scheme. 

Go to the Which? Consumer Rights site to find out about the rights ATOL protection gives you when things go wrong when you're on holiday.

Low Cost Holidays is now regulated by the Spanish financial protection system and the CAA's legal view is that the value of the protection offered to consumers by the Spanish system is extremely limited compared to that provided by the ATOL scheme.

A CAA spokesman said: “Even if passengers are protected (which would most likely be for a Spanish court to finally determine) the protection under the Spanish system is not the same as ATOL. For example, unlike the ATOL scheme, passengers protected under the Spanish system are not repatriated home in the event of travel company failure whilst abroad.”

Which? believes that Atol protection is crucial because it provides protection for your money if you have bought a flight plus other elements of a holiday. If your holiday is not ATOL protected, you could be left stranded abroad if things go wrong.

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