Coronavirus cancellations: Getting a refund and claiming on insurance

If you’ve had a holiday or event cancelled, or if you didn’t receive goods or services you were expecting due to coronavirus (Covid-19), find out about your rights and how you can attempt to claim a refund.

If your holiday has been cancelled due to the coronavirus pandemic, start by talking to your travel provider to get a refund. They might offer vouchers as an alternative to a cash refund, but it’s important you think carefully before accepting these, as it could mean you are unable to claim a refund later.

This also applies to other goods and services you may not have received due to coronavirus.

If you can’t get a refund from your travel provider then there are other options available. You could get help from your credit or debit card provider or from your travel insurer.

Read our information on:

Holiday cancellations

If your holiday is cancelled and you are looking for a refund, you should start by talking to the provider of the holiday. This may include, for example, the hotel, travel agent or airline.

You may be entitled to a replacement or a refund.

If you are unhappy with the response, or if your provider goes out of business, you can contact either your card issuer if you’ve paid by card or your insurance provider.

For packaged holidays, if the provider goes out of business, you should contact the industry associations, ATOL or ABTA, who represent travel agents and tour operators in the UK.

In many circumstances, travel is protected under these industry schemes.

Getting help from your credit or debit card provider

If your holiday is cancelled, or if you didn’t receive goods or services you were expecting to, you may be able to make a claim against your debit or credit card provider that you used to make the purchase.

This will depend on your individual case and any contractual terms.

It can also differ depending on whether you used a credit or debit card to purchase the goods or service.

Chargeback

One way to get a refund is for your debit or credit card provider to reclaim the money back from the travel provider, under specific circumstances set out in the card scheme (Mastercard, Visa and Amex) rules. This is known as chargeback.

The most common reason for a chargeback claim is where goods or services are not provided and help has already been asked for from the retailer, with no success.

You normally have 120 days to raise a chargeback claim with your card issuer from the expected delivery date of the goods or services not being provided.

It is important to note that chargeback is not a statutory right. The card issuer and the providers bank will normally work together to look into the refund for you.

Remember, you can only reclaim the amount you paid on the debit or credit card via the chargeback process.

Section 75 claim

If you paid with a credit card, and the cost of the goods or services was between £100 and £30,000, you may be able to get a refund from your card issuer.

This is known as a Section 75 claim and is a statutory right under the Consumer Credit Act 1974.   

Under Section 75, if you have a claim against the retailer for breaking the terms of any contract you have with them or for making untrue statements, you can bring the same claim for a refund against your credit card issuer. Paying for any part of the price of the goods or services on your credit card will allow you to make such a claim

Your claim can include any circumstances where the product is faulty or the retailer does not deliver what they promised, including if they go out of business.  

To raise this type of claim with a credit card issuer, you should speak to your bank within 6 years of buying the goods or services or, in case of non-receipt, when you were due to receive the goods or services.

Making a travel insurance claim

If your travel has been impacted by coronavirus, your travel insurance may be able to help.  All travel insurance policies are different. But most include cover for customers where they have suffered a financial loss after the cancellation of travel arrangements in certain circumstances.

Where you have had travel arrangements cancelled because of coronavirus, but were unable to claim a refund from your travel provider, your travel insurance may help.

Before contacting your insurance provider, it’s important to remember: 

  • a claim under an insurance policy depends on the terms of the policy -  this can include terms that you must act to minimise any losses
  • if you make a claim, this may have an impact on how much you pay for insurance in the future. You may also need to pay an excess fee
  • claims under the policy will only cover the people covered by that policy - if you purchased travel for a friend or relative this would not normally be covered under a personal policy

You may decide to make a Section 75 claim rather than claim on your travel insurance policy, as a Section 75 claim may not have the limitations outlined above. 

Generally, you should not have to contact your card issuer about a Section 75 claim before contacting your insurer. Under current guidance your insurer could ask you to speak to your card issuer before making an insurance claim. In some cases, you may be better off making a claim through that route. We are encouraging insurers to support you through the process of understanding your options and getting your refund. Where you could claim through your card issuer or insurer, there is nothing in our rules that stops your insurer settling the claim in full (so long as there is no disadvantage to the consumer in this). They could then, where appropriate, seek to claim back from your card issuer if there is a valid claim.

We think having choice is important. Historically, who you contact first to get a refund has not been a significant issue and has not come to our attention. But given the current strain on the travel market and the current practices that exist, the complexity involved in getting a refund has become clearer. 

On Friday 31 July, we published a consultation on guidance for firms to help their customers identify their quickest and easiest options to claim for any cancelled travel or events caused by coronavirus.

For most travel insurance claims, you are expected to show you have suffered a financial loss, which you have been unable to recover by way of a refund from your travel provider. 

Find out more about claiming on your travel insurance from the Money Advice Service.

Accepting vouchers or other alternatives to cash refunds

Many firms have been offering vouchers or other alternatives when they have been unable to provide goods or services.

If your purchase was made from a UK based company you have a right to choose whether you wish to accept a cash refund or an alternative. You do not have to accept a voucher.

If you accept an alternative to a cash refund this may mean that you cannot later decide to claim for a refund from your card issuer, or claim under your insurance policy.

If you have travel insurance, you should contact your travel insurance provider before accepting a voucher, so you understand what this will mean for your insurance cover.

If the vouchers are not claimed in the timeframe given, or the travel provider goes out of business before the voucher is used, you may not be able to return to the card issuer with a valid claim.

If you have any doubts, talk to your travel provider and check with your card issuer before you accept a voucher.