Your Rights When an Airline Goes Bankrupt
So you booked a flight and now the airline has announced it has gone bankrupt? Unfortunately, in the world of aviation, it is becoming a regular occurrence for popular airlines to suddenly go bust due to financial issues. Thus, leaving the blameless passengers in a horrible nightmare of a situation where their tickets are suddenly worthless.
If you happen to find yourself in this position right now, then you have come to the right place for your answers and hopefully, some much-needed information and explanation. In the sections below we will give you advice on how to contact the right people, get regular updates, how you can get a refund for your flights and how to secure yourself against this in the future.
1. What to do if your airline goes bust?
The most stressful part about an airline announcing they have become bankrupt is the total lack of information that follows.
Due to the nature of bankruptcies, they really differ per airline, as there is no standard global policy or procedure. Hence, it completely depends on the airline's policy. This is why it is best to start by checking the airline’s website where they will most likely put up an update to provide assistance and contact details.
However, there’s probably not going to be a lot to go on though, so it’s good to read up on your rights, and know how you can get a refund or a ticket home.
There are certain elements that we at CheapTickets.co.th need to take into consideration when dealing with a bankrupt airline and trying to help you, the passenger.
It is difficult because everything is different and by a case by case basis so we need to ensure that:
- The airline has become officially bankrupt (financial or operational problems are not classed officially as bankruptcy)
- CheapTickets.co.th is completely dependent on the individual airline’s policy in case of bankruptcy which includes all details revolving around refunds, compensation, and rebooking of flights.
- We will only provide you with concrete information and will therefore only make statements we know to be true and clear.
- Unfortunately, refunds are never guaranteed under these circumstances (especially for those who have not purchased Ticket Guarantee which provides insurance protection). If Ticket Guarantee has been purchased, and the airline is officially bankrupt, then passengers will receive their refund within 2 months.
- It will differ per case as to what can be refunded in terms of non-flight products (i.e. booking fees, cancellation insurance, etc). This will be reviewed per individual case.
- Usually, the airline will contact the passenger directly. However, if this is not the case, please do not hesitate to contact our Customer Services Team.
2. What are your rights?
This is where it starts to get even more stressful. When an airline suddenly becomes bankrupt, your flight ticket instantly becomes worthless as the flight no longer exists. The worst news? Due to there being no protections set in place for this, you are literally left stranded.
It is actually down to the airline itself to decide what rights you have as a passenger. You can find it in the Terms & Conditions (T&Cs) on your ticket. So, do remember to read up on these T&Cs and find out what exactly your rights are and if there is anything which covers bankruptcy.
Sadly, the T&Cs themselves are most unlikely to be honoured if the airline is no longer operating anymore which will leave you screaming with dismay. However, it is still good to read up so as to build a stronger case when trying to obtain refunds, compensation or alternative flights in the future.
3. Will other airlines help?
While your ticket may have essentially become useless, some airlines do still provide stranded passengers a route home. This is a rarity, however, and it won’t be completely free either. This will most possibly come at a discounted rate and will be a completely new ticket.
If your government or other airlines aren’t stepping in to offer assistance, your best course of action is to buy replacement flights yourself and try to get a refund for the original ticket. Unfortunately, this expense will not be covered by airlines coupled with the possibility that any refunds or claims are not guaranteed.
4. Examples of major bankruptcies
WOW Air – March 2019
On March 2019, WOW Air suspended all flight operations as a result of financial problems. All WOW Air flights were cancelled and unfortunately, the airline did not provide any alternatives.
Primeria Air – October 2018
On October 2018, Primeria Air declared bankruptcy and asked stranded passengers to make their own arrangements to return home.
5. How to obtain compensation?
Not all hope is lost - there are several ways in which you can claim for compensation to gain back the value of that lost flight ticket.
Did you pay with a credit card?
More often than not, this is the safest way to buy anything these days and in this instance, it will be to your advantage as your credit card will protect you if the airline company goes under. Do try contacting your credit card provider and ask for a refund. Be sure to enquire this straight away and have as much information as possible in order to ensure the refund process goes as smoothly and timely as possible.
Purchased Ticket Guarantee?
If you have purchased Ticket Guarantee through CheapTickets.co.th, the monetary value of the flight will be claimed from our insurance provider whom you have paid for. This process will take place once it is confirmed that the airline is indeed, officially bankrupt.
Once the claim has been approved, you will receive the money via CheapTickets.co.th, not the insurance company and will take 1 to 2 months. During this time, we will take care of the full process and inform you about any updates. Hence, we seek your cooperation and understanding to wait patiently.
How to purchase Ticket Guarantee?
Buying Ticket Guarantee on CheapTickets.co.th is really easy, just follow the simple steps below:
- First, after confirming your flight search results, all checkout pages will lead to a 'Passengers' page. Here, you can fill up the passengers' information as required and choose to purchase Ticket Guarantee at the bottom of the box.
- As you can see, choosing to buy Ticket Guarantee allows you to claim a refund for your flight tickets purchased up to £2,000 per ticket (or up to the same amount in the local THB currency).
Note: Cost of Ticket Guarantee depends on your flight routes chosen.
6. How can you protect your flights and money?
The best way to cover yourself for any eventuality, and especially airline bankruptcy, is to follow the steps above to help put your mind at ease.
Here at CheapTickets.co.th, we highly recommend purchasing Ticket Guarantee when you book your flight as we operate as an ABP service to indemnify you in respect of your Financial Loss arising directly from the cancellation or curtailment of a Scheduled Airline Flight arising solely from the Insolvency of the Scheduled Airline up to and not exceeding £ 2,000 (or maximum the similar amount in your local currency) for any airline ticket, as defined below.
It is a condition, however, that the Airline Bankruptcy Service fee has been paid to CheapTickets.co.th in full and punctually when it is due for payment.
7. What else can I do?
The best course of action in this situation is to stay calm and remember to check the airline website regularly for the latest updates. Feel free to check our FAQ’s on the Customer Service page as well.