I've previously blogged about the demise of Gills Cruises, Dreams Holidays and most recently Holidays4U. I've been able to say that because of the ATOL system, everyone booked with those companies will receive a refund. And this is correct...

But a trend that we've seen during the last few years is holiday companies intentionally avoiding selling Package Holidays. It's something that is becoming more and more common. What's worse is that we frequently hear from people that think, and have been led to believe, that they have bought a package holiday, but when you look a bit closer they haven't!

So, why does it matter whether or not you have bought a package holiday?

Does it matter if I buy a package holiday?

If you buy a Package Holiday, you have protection. There is a good explanation on the ABTA website, but the basics are;

• Package Holidays including flights - These operators must have an ATOL (Air Traveller Organiser's License).
• Package Holidays NOT including flights - The operator has to hold a bond or insurance for financial protection.

Of course, there is a bit of a premium for paying to be in one of the schemes, but it is certainly worth it if you have any problems. in addition to security for your money, if you have to bring an accident compensation claim as a result of an accident abroad, then you can pursue your tour operator and not have to chase the foreign owner. Tour operators also have a much higher level of responsibility for the holiday and how the contract is performed.

Have I bought a package holiday?

The big problem is with the definition. Fundamentally, a package holiday is transport, hotel and other components sold for one inclusive price. If a travel agent or tour operator provides flights from one company and accommodation from another, they can argue it was not a package. You may only get a refund for the flights under ATOL. They often claim that they're simply an agent and have no other responsibility for the booking.

The government have tried to remedy this by formulating a Flight Plus scheme. It will be introduced on the 1st January 2012 and will cover any combination of accommodation, flights and car hire. Beware, there are still loopholes. It won't cover flights purchased online.

And where there's a will, there's a way. Watch out for agents who say they are not selling products but acting on your behalf and so may avoid refunding you. A lot of travel agents don't want you to know you're not buying a package. They'll bury the information deep within their terms and conditions and count on the fact that we all hate trawling though the seemingly endless pages. However, it's important we do because if the holiday is not a package in the real sense of the word you may end up out of a holiday and out of pocket.

Next year, we will hopefully have the update Package Travel Regulations, so we should get even more consumer protection. Although they're not signed off yet, they will hopefully extend the liability of the travel agent and tour operator further in favour of the holidaymaker.