What does ATOL protection mean – and why it matters for your holiday

If you’re getting ready to jet off on holiday and the travel company that you booked with goes out of business, the ATOL scheme can step in to assist. But what is ATOL protection, and how does it help? Our guide answers these questions and more.

ATOL stands for Air Travel Organisers’ Licensing. It’s a scheme that offers holidaymakers financial protection if they book a package holiday that includes a flight. Under the ATOL scheme, you may be given a refund or a flight home if your travel operator becomes insolvent and ceases trading – more commonly known as ‘going bust’. 

ATOL was first introduced in 1973 as the popularity of charter flights from the UK to places like Spain and Portugal increased. The scheme was brought in as part of the Civil Aviation Authority (CAA) and is still run by that organisation today. Originally the scheme covered only package holidays, but it was expanded in 2012 to cover what’s called ‘flight-plus’ holidays.

‘ATOL protected’ is the term used in the travel industry and media when talking about holidays booked with an ATOL member. You’ll often see TVs ads for holidays which talk about packages being ‘ATOL protected’. 

But what’s the meaning in plain English?

If you’ve booked an ATOL-protected package holiday including a flight, then the money you have paid for it will be protected if that travel company goes bust. But the financial protection you’re offered under the ATOL scheme differs depending on whether your holiday has already started or not. 

ATOL protection if your holiday is in the future 

If you’ve booked your holiday but are still waiting to travel when the company goes bust, you may be eligible for a refund under the ATOL scheme. This would be for the full package, so the flights and at least one additional service – typically accommodation but it may also include car hire or tours.

ATOL protection if you’re already on holiday 

If you’re already on holiday when the travel company goes bust, then the ATOL protection is all about minimising disruption to your holiday and getting you home safely. It may:

• Help you to stay in your hotel
• Book your flights home

It may also refund money you’ve spent on replacements for ATOL-protected parts of the trip such as accommodation and car hire. 

To understand what ATOL protection covers, the terms ‘flight-inclusive’ and ‘flight-plus’ are important. The concept of the package holiday has evolved greatly since ATOL was first introduced in the early 1970s, so it can be difficult to know exactly what constitutes a package holiday in 2025.

The ATOL websites clarifies that if you have booked two or more elements of a holiday, one of which must be the flight, and pay in one transaction then you’ve booked a package holiday. The ATOL scheme categorises holidays it covers as flight-inclusive and flight-plus. 

Flight-inclusive packages

‘Flight-inclusive’ is the main term ATOL uses to describe the package holidays it covers. This is a holiday booking that includes a flight and at least one additional item, typically hotel accommodation, but it may also include car hire and tours – anything booked as part of an inclusive package holiday. This type of holiday must be ATOL-protected under UK law. 

Flight-plus 

Flight-plus was introduced in 2012 to expand ATOL protection beyond traditional package holidays. It’s still a flight booked in addition to another service, typically your accommodation. But it’s not marketed as a package holiday; they are independent services, and you can book them within a specified short time period. And it can be from the same company or connected companies.

A failed ATOL holder is the name given to any travel company which holds an ATOL licence and goes into insolvency, or ‘bust’ as we’ve said throughout this article. So, if you’re waiting to go on holiday, or are on holiday, and your tour operator goes bust you are then dealing with a failed ATOL holder.  

To make a claim to get your money back through the ATOL scheme your holiday must have been booked with a travel company that has been declared a ‘failed ATOL holder’ in the Civil Aviation Authority’s Register of Failed ATOL Holders.     

You can check the list of failed ATOL holders to see whether a company you’re considering booking a holiday with is on it. If you have an ATOL certificate, which shows you’re protected, you’ll need to make a claim at the ATOL site.

No, not all holidays are covered by ATOL. Most importantly, it only covers holidays that include a flight. So, if you travelled via sea, road or rail – for example, a cruise, or on a coach tour – you won’t be covered by ATOL protection. And if your trip does include a flight, there are some exclusions regarding what is and isn’t covered.

ATOL won’t cover you if:

• The trip you’ve booked isn’t ATOL protected
• The travel company isn’t considered a ‘failed ATOL holder’ 
• Your holiday didn’t meet your quality expectations 

You also won’t be covered by ATOL if 12 months have passed since the travel company stopped trading. After this point, the ATOL scheme does not accept new claims.

When you’re browsing for your next holiday, it’s easy to check whether the travel companies and tour operators you’re considering are ATOL members. On the website there’s a simple ATOL protection check tool where you can search by ATOL number and company name.

They’re both four-letter acronyms that begin with an ‘A’ and both relate to financial protection for holidaymakers. So, there’s plenty that ABTA and ATOL share in common. But there’s one significant difference – ABTA is focused on financial protection for holidays with travel by sea, land or rail. ATOL offers protection for holidays with flights. Learn more about the ABTA scheme. 

No, ATOL protection is not the same as travel insurance. Under the ATOL scheme you are only financially protected if the travel company you booked with goes bust. Travel insurance has a much broader remit – covering unforeseen events like cancelled or delayed flights, medical costs while abroad, lost, stolen or damaged items, personal injury, and more. 

ATOL advises holidaymakers to book ATOL protected trips and then arrange travel insurance as well for increased protection.