Have you heard anything?
You need to as a matter of course go to ABTA and the CAA - which governs the ATOL.
There is a huge thread on here...
http://www.holidaytruths.co.uk/forum/urgent-love-holidays-t160341.html
Love holidays will be putting together the different components of your holiday ie, booking your flight then booking your accommodation seperate.
Did your invoice show a break down of prices as be interesting to know the original flight price?
You've paid £378 deposit & LH say you owe £662 therefore, total holiday cost £1040. Yet they are quoting £992 to cancel just the flight part?
Who has/is receiving the refund on your original flights?
I'd also want to know the accommodation cost as from there you can work out what's going on with the flight prices.
If they booked alternative flights without first consulting you then they cannot ask you for the money to cancel them just because they will be out of pocket.
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