Importance of Scheduled Airline Failure cover

With the news that thousands of people have been left stranded in Spain, Portugal, Cyprus and Egypt after Scotland's biggest airline collapsed, Defaqto is urging customers to check that their travel insurance includes Scheduled Airline Failure cover.

"Be prepared when booking holiday travel in case your airline goes bust", said Jonny Langstaff-Ellis, insurance analyst at leading research company Defaqto. "Many people might think they would be covered if their airline goes bust, but as the collapse of Flyglobespan this week shows this is often not the case.

"However, you can see from our top tips below that there are a few things you should always do to protect yourself", said Mr Langstaff-Ellis.

Top Tips from Defaqto:

1. First and foremost try to book flights through a travel agent who is ATOL bonded. That way if your airline fails the travel agents will arrange to get you home, or refund the cost of your tickets.

2. If you do book direct with the airline ALWAYS pay by credit card if you can. That way you will usually be able to reclaim for the cost of the lost tickets from the credit card provider.

3. As a backup your travel insurance policy might cover you, but be warned - only around 1 in 6 travel insurance policies provide cover for the cost of airline failure, either as standard, or as an optional extra.

If you are thinking of buying annual travel cover you can see if your policy provides Scheduled Airline Failure by visiting defaqto.com

Some well known travel insurers that DO cover scheduled airline failure include Direct Line, Direct Travel, the Post Office, the AA, SAGA and Sainsbury's Finance.