Holiday fraud is a significant problem: Action Fraud received 6,066 reports last year, with losses totalling more than £11 million.

You may want to protect your holiday from your airline or accommodation going bust, but how? Insuring against insolvency/financial failure is no straightforward task. If you're trying to figure out if you're already protected by ATOL or ABTA, or if you need to buy separate travel insurance with SAFI or ESF cover, we've tried to explain the basics here in plain English.

ATOL or ABTA: Protection for Package Holidays

If you booked a package holiday with flights and accommodation together (that is, you paid one price for the total trip), you should have cover if your travel firm holds an ATOL (Air Travel Organisers Licensing) and you've received confirmation that you are protected with an ATOL certificate. In that case, the travel firm is responsible for your flight arrangements and must either make alternative flights for you so that your holiday can continue or provide a full refund. If you are already abroad, the travel agent should make plans to allow you to continue with your holiday and then bring you back to the UK at the end of your trip.

ATOL does not protect you if you book direct with an airline. If your ATOL travel firm books your flights and accommodation separately, then only your flights would be protected by ATOL. In that case (i.e., flights and accommodation booked separately), you may still be protected if your travel agent runs their own financial protection scheme through the Association of British Travel Agents (ABTA).

When you book a package holiday, you can find out if your booking is covered under ATOL or ABTA. Some websites falsely claim to hold an ATOL or to offer ATOL protection. The CAA warns that these sites are often run from outside the UK, and that while it works with other agencies to shut them down, this isn't always possible. Checking a firm directly before booking is the reliable approach. The CAA also publishes a Websites to avoid list of companies that have made false ATOL claims.

How to Check for Protection

The CAA sets out several checks to make before booking:

• Search the company on Check for ATOL. You can search by company name or ATOL number. ATOL numbers are four or five digits, sometimes with a T at the start. The name on the website should match the ATOL record exactly.

• Check the web address hasn't been altered. The CAA gives the examples of a misspelt company name, or an address changed from .co.uk to .org.

• Look for the ATOL logo and number

  on the travel company's website or shop window — the logo must always appear with the number.

• Phone the ATOL holder if in doubt using the number on their ATOL record rather than one given on the website you're checking.

• Treat unusually low prices with caution. The CAA notes the risk when prices are much lower than equivalent offers elsewhere.

If you're booking through an agent rather than the ATOL holder directly, the agent must identify who is protecting your trip. You can confirm this with the ATOL holder.

Protection When You Book Your Own Holiday

If you're not covered by ATOL or ABTA because you made your own arrangements, you may assume that you're still covered through a travel insurance policy. However, many travel insurance plans will NOT cover you if your airline or hotel goes bust. If having this insolvency protection is a priority for you, look for plans that include Scheduled Airline Failure (SAFI) and/or End Supplier Failure (ESF).

It's always worth reading the fine print of a plan's terms and conditions yourself to fully understand the scope of cover before you purchase travel insurance. And some plans will only pay out if you can't be reimbursed another way (e.g., from the airline or your credit card).

SAFI

Scheduled Airline Failure (SAFI) is designed to cover your costs if an airline or agent goes into administration. SAFI is not a standard feature of UK travel insurance, and a higher-tier policy doesn't guarantee it's included. The Insurance Product Information Document (IPID) for any policy will state whether it covers airline failure, so that's the place to check before buying.

SAFI protection may vary significantly depending on the policy. Some travel insurance plans simply cover the cost of the original tickets purchased or any unused portion, while others may cover the additional cost of purchasing new flights (e.g., new tickets for travel back to the UK).

Depending on the policy, with SAFI you should be covered for either:

• Your original ticket cost paid prior to departure

• The cost of a return flight to the UK or onward flight(s) in order to complete the pre-arranged journey at the same standard as originally booked

End Supplier Failure (ESF)

If you've booked your flights, accommodation, and other services separately and are not covered by ATOL, the most comprehensive alternative has historically been End Supplier Failure (ESF). ESF is offered by a limited number of insurers, and availability varies. Policies covering the failure of a hotel, car hire firm or ferry operator are less common than general travel insurance, so it's worth checking the IPID for this specific benefit rather than assuming it's included.

Credit Card Protection

If you paid directly to the airline by credit card you might be protected by Section 75 of the Consumer Credit Act 1974. Debit cards don't carry Section 75 protection. You may be able to use chargeback instead, which is a card scheme rule rather than a legal right, available on Visa, Mastercard and American Express cards. Time limits apply (typically 120 days from the transaction or from when you became aware of the problem).

FAQs

What is end supplier failure on travel insurance?

End Supplier Failure (ESF) can cover your costs if a travel provider fails financially and can no longer deliver the transportation or accommodation you've bought from them. ESF (also called Financial Failure or Insolvency cover) can cover the purchase of alternative flights should your airline go bankrupt and/or alternative accommodation if a hotel you've booked becomes insolvent. ESF can also cover ferry, coach and railway tickets, car hire and villas or cottages, but the extent of cover depends on the small print in your policy's terms and conditions.

Do I need end supplier failure travel insurance?

End Supplier Failure (ESF) is a valuable feature, but insisting on it in 2026 will drastically reduce your choice of insurers. Because so many top-rated providers have dropped ESF and SAFI, you may find that the remaining policies that offer it are significantly more expensive. Where a policy with this cover isn't available or affordable, paying by credit card gives a separate route to protection. Section 75 of the Consumer Credit Act 1974 can make the card provider jointly liable with the supplier on individual purchases costing more than £100 and up to £30,000, including where the supplier becomes insolvent.

One limitation is worth knowing: Section 75 depends on a direct relationship between you, the card provider and the supplier. Booking through an agent or intermediary can break that chain, which is common in travel. The CAA's own wording is that a credit card 'may provide additional protection.'

What is scheduled airline failure insurance?

Scheduled Airline Failure Insurance (SAFI) covers costs if an airline or agent goes into administration - coverage can vary with some plans simply covering the cost of the original tickets purchased or any unused portion, while other plans may cover the additional cost of purchasing new flights (e.g., new tickets for travel back to the UK). SAFI cover may be included as standard with your travel insurance, although this is somewhat rare and typically only offered on more premium plans. Other times you can buy it as an optional add on feature, but not always.

• Check for ATOL