Airline Went Bust? Can You Still Claim Compensation?
If an airline collapses before paying your compensation claim, here's what happens and what options you realistically have.
UK airlines have collapsed before (Monarch, Flybe, Thomas Cook), leaving passengers with unresolved compensation claims. Here's what actually happens.
If the airline is still operating
If your claim relates to an airline still flying, nothing changes: your right to compensation stands and Klaimly can pursue it normally.
If the airline has entered administration or liquidated
Once an airline formally ceases trading, unpaid compensation typically becomes an unsecured debt in the insolvency process. In practice, unsecured creditors, including passengers awaiting compensation, are usually paid last if at all, and payouts (if any) can take years and are often a fraction of what's owed.
What you can still do
- Check if you paid by credit card: Section 75 of the Consumer Credit Act may let you claim the cost of the ticket back from your card provider
- Check for ATOL protection if it was a package holiday
- Register as a creditor in the administration process, though recovery is not guaranteed
Claim early, not after collapse
The lesson is to claim promptly. A claim submitted and paid before an airline runs into financial trouble is safe; one left unclaimed for years risks being worthless if the airline later collapses. If you have an old, unclaimed delay, start it now.