Is It Important For Travel Agents to Be Bonded?

As one of the most widely recognised forms of financial protection, it’s easy to assume that your travel business must be bonded. (It’s also way easier than having to choose yourself, we get it!) Despite that, it is not essential for Package Travel Regulations compliance. Nor is being bonded necessary for good financial protection.

If your travel business is selling package holidays, it’s important to understand your legal options. Under the PTRs, being bonded is only one option. This comes alongside insurance and trust account protection.

The Definition of a Package for PTRs

A package is defined by selling at least two of the following elements at an inclusive price:

• Accommodation,
• Transport, and
• Other tourist services (such as activities like skiing) that contribute to a significant portion of the package (basically the traveller is probably going on holiday for that activity).

Package Travel Regulations apply to both ground-based and flight-inclusive holidays. Packages including flights would simply require an ATOL as well. Despite being a package, considered the safest way to book, travel sellers are all aware that things can still go wrong.

This is why travel business and consumer financial protection are so vital.

How To Be PTR Compliant

The government has outlined three acceptable routes for travel businesses to ensure compliance.

1. Joining an independent trust account solution, such as Protected Trust Services (that’s us!).
2. Financial Failure Insurance – an insurance that is generally paid on a per passenger basis.
3. Being Bonded – having a bond in place in correlation with the size of your travel firm. Bonds tend to start from £50k and as such is an incredibly expensive option.

Therefore, being bonded is purely a vehicle to adhere to PTR compliance. Bonding is not a legal requirement and for many the independent trust account is the favoured option (we’re only a little biased).

Why Could a Trust Solution Be Better For You Than Being Bonded?

The independent trust solution is the most scalable and affordable option for many travel companies. If run properly, it is also the most transparent and flexible form of financial protection available.

As it is run by independent trustees, the PTS trust account is not only protecting consumer monies from being spent before their holiday, but keeps those monies safe and out of even our hands until it is time to pay suppliers, provide a refund, or release your profits.

The monies are reconciled daily and separated by booking, so you and your travellers can see exactly where those monies are down to the penny.

With financial protection like PTS, the event of something going wrong, isn’t much of an event at all! When something happens, consumer monies can be delivered directly back to the consumer quickly. This means that if a refund is necessary, you’re not paying out of pocket. This allows your business to continue to grow with confidence.

What Does Financial Protection Mean to You?

In essence, there are different vehicles to ensure PTR compliance and bonding is just one. Each vehicle is available to ensure that a suitable fit is provided for every travel business. So, in conclusion, bonding is not required but PTR compliance is.

PTS are pleased to offer one of the most cost-effective solutions to you and your travel business in the industry. If this sounds interesting to you, please call 020 7190 9988 to discuss your business requirements, or send us an email to ask@protectedtrustservices.com.