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Scheduled Airline Failure Insurance: Do You Really Need It?

By Maria Hickey on February 2nd, 2024

When airlines fold amid financial pressures, customers suffer cancelled journeys and chase refunds in vain. Yet while such failures generate headlines, adding specialised products like Scheduled Airline Failure Insurance rarely proves essential for most travellers when easier protections exist.

This guide helps travel partners determine suitable protections in case the worst unfolds mid-trip.

Evaluating Real Risks of Airline Collapses

Though media broadcasts aviation industry warnings, the likelihood of individual 

passengers getting impacted on specific trips actually remains low with factors like:

Strict Oversight

The UK tightly regulates airlines, preventing them from rapid, risky expansion. This stops struggling airlines from selling too many tickets they can’t afford to fulfil.

Carrier Diversity

Many airlines are owned by just a few large airline groups so if one airline fails, the group often keeps flights running by merging routes into other airlines they own. This prevents major travel disruptions.

Refund Prioritisation

If an airline shuts down in the UK, laws make sure ticket holders get priority for refunds from any remaining funds. This lowers losses for passengers.

Drawbacks of Airline Failure Insurance

Since most flights go on as planned even if an airline fails, flight insurance may not be worth it for many travellers when you consider:

  • Narrow Coverage – Policies only reimburse cancelled trips specifically resulting from a named airline failure. Other disruption causes or overall supplier failures often exclude cover.
  • Premium Costs – SAFI premiums ranging £15-40 per trip still add up, especially for frequent travellers.
  • Claim Hassles – Processes documenting unused flights and out-of-pocket costs accompany claims, adding additional hassle.

Smarter Protection Alternatives

Rather than airline failure policies with limited applicability, experts recommend broader plans cushioning wider risks while including airline failures as covered events. Options include:

Comprehensive Travel Insurance

Comprehensive travel insurance covers you if your flight is cancelled, delayed, or disrupted from an airline failure. These plans cost less than specialised flight insurance, offering better value.

Refundable Fares

Paying slightly higher flexible ticket prices eliminates cancellation costs worries if any factors impact journeys. Travellers can simply request refunds if trips get aborted for any cause.

Payment Method Claims

If you book with certain premium credit cards, the card allows you to dispute the charges and get your money back if part of a trip fails and a refund claim is denied. This acts as self-funded coverage.

Meeting Clients’ Needs Through Better Solutions

While preparing for worst-case scenarios is wise, clients gain more financial security against trip problems through conventional insurance plans. These offer similar or lower costs compared to niche airline failure policies with trickier claims.

Smart travel agents recommend comprehensive trip insurance and flexible tickets. These address broader risks beyond just airline bankruptcies, showing care for clients’ budgets.

Brisco Business’ Travel Agent Insurance

Brisco Business provides travel agent insurance that covers advising clients on add-on tours, if a mishap occurs abroad. Our plans show real commitment to protecting both agents and clients.

Contact us to discuss airline uncertainty risks and smart solutions. We build reputations for proactively caring about client investments – not just reactively fixing issues if trouble hits.

Maria Hickey

For more than 20 years, Maria has worked in the insurance sector and has extensive underwriting and customer service expertise. Maria is an experienced Senior Underwriter with a particular specialism for shop, office and surgery related insurance.

All articles by Maria Hickey

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