This in the Sunday Times yesterday. More important than ever now to read the T&Cs and find out just what you are covered for.
http://travel.timesonline.co.uk/article/0,,10295-2112423,00.html
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However if you book with a travel agent who has their own ATOL, you can still have protection even for low cost airlines - which includes Thomson's own Thomsonfly brand.
Protection is not gone, but you'll have to make sure you have it - it might not be automatic now!
With so many people doing diy these days especially to the popular resorts the days of the package must be numbered.I gave up on them some time ago and have had higher quality holidays for a lower price since.
ATOL is the Air Tour Operator Licence - if you buy a package and it is ATOL protected - your money is protected by this. If the airline or tour operator goes out of business - this is the scheme that helps. Especially helpful if you're on holiday at the time as they will get you home.
Credit cards will get you a refund but you'll have to pay out for a flight home if the airline goes bust.
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