Cruise collapse raises cover questions

THE collapse of Britain’s All Leisure Group last month has again raised the complex issue of what recourse Australians have when offshore companies go bust.

As the operator of the Swan Hellenic and Voyages of Discovery cruise lines, All Leisure’s failure resulted in the cancellation of dozens of departures and left about 13,000 travellers in limbo.

Around 400 people were caught out having already left home, leaving the UK’s Civil Aviation Authority to coordinate and pay for their repatriation under the country’s Air Travel Organiser’s Licence (ATOL) scheme.

Thousands more have had their future plans dashed and will be left to seek refunds via the Association of British Travel Agents (ABTA).

But for several hundred Australians caught in the collapse, the path to recompense is less clear.

The UK’s protection schemes cover only British residents or those who booked via British travel agents, meaning many of the Australians affected simply join other creditors hoping to recover debts from the group.

Travel insurance is the frontline defence for Australians in the case of overseas failures, but, as local media reported when All Leisure failed, the provisions in different policies vary considerably and some travellers have already been told they won’t be covered.

Aussietravelcover was among the first to clarify the situation, issuing an alert to travel agents to confirm there were provisions under its policies to cover insolvencies. Allianz Global Assistance also said it was able to offer insolvency protection.

Cover-More said it had not received any enquiries or claims from the All Leisure collapse but would review any on a case by case basis.

SureSave confirmed it offered insolvency provisions, covering travellers who had to cancel or rearrange travel due to the collapse of operators including scheduled and publicly available cruise lines.

In some cases travel agencies provide their own protection, such as that offered by Mobile Travel Agents. Its Zero Flight Risk cover is free and protects against the insolvency of approved MTA suppliers.

The national sales director of SureSave, Talbot Henry, said not all travel insurance policies provided the same level of cover, and that it was important to purchase insurance at the time of booking.

“Travellers are increasingly seeking the advice of agents,” Henry said. “In our annual independent research in 2016, the SureSave Travel Insurance Index, we discovered that 70% of Australian travellers view travel agents as a ‘trusted source of travel safety advice’, which was a 15% increase since 2012.

“We encourage agents to ensure that customers read the wording of their travel insurance policy and that they fully understand the level of cover this provides them.”