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What happens when the airline you’re flying goes bankrupt mid-flight?

We recently flew economy with Cobalt Aero from Manchester (UK) to Larnaca (Cyprus). Cobalt had routes connecting Cyprus with numerous European destinations including London and Manchester in the UK, as well as Dublin, Copenhagen, Paris, Dusseldorf, Frankfurt, Zurich, Geneva, Madrid and Moscow. They also covered Athens, Thessaloniki, Mykonos, Chania and Heraklion in Greece, and in the Middle East flew to Beirut, Tel Aviv and Abu Dhabi. You could be forgiven if you’d not previously heard of the airline – it was probably primarily known by Cypriots and people working in the industry, and perhaps by some people residing in the above locations. That said, with its six aircraft it had already completed more than 12,000 flights and served over a million passengers in a little over 2 years since its inception. I was working on an assignment for the airline, documenting their offering for the purposes of a review on A Luxury Travel Blog. We flew from Terminal 1 at Manchester where check-in was a reasonably quick and largely uneventful process. Our flight was on 17th October 2018, departing Manchester at 15.30 and landing at Larnaca at 22.15, with our return scheduled for a week later. There were five of us travelling together on board this Airbus A320 – although I was also working, we were also enjoying a multi-generational getaway, so I was travelling with my wife and two sons, as well as my mother. It was a typical grey day in Manchester so very much ‘business as usual’. On board, the seats were comfortable. The in-flight magazine was dated August 2018 and a little bit worse for wear as a result, with features on Halkidiki, idyllic destations near Athens, Cyprus’ Blue Flag beaches and ‘Jerusalem – Holy City’, as well as a culture section and a number of interviews. Take-off was on time and everything going to plan. The only minor irritation was that it was quite hot on board and the air conditioning didn’t seem to be working too well. There were no screens in the headrests but one rather nice feature on board was the Bluebox portable wireless IFE platform called Bluebox WOW. This meant that wireless media content could be streamed to passengers’ own devices – to phones, laptops and even Kindles. Between us we managed to get this to work on an iPad and a OnePlus smartphone, but struggled with getting it to connect to a Lenovo laptop and an iPhone. There are apparently three Bluebox Wow boxes per aircraft, conveniently secured in overhead lockers, but perhaps there is only so much ‘load’ each one can take. On the face of it, this was an airline that looked to be going places. In addition to generating trust with its passengers, the airline was gradually starting to build relationships with other airlines, most notably with Etihad Airways, helping to widen passenger reach and encourage more visitors from the Middle East and beyond to Cyprus. Other similar partnerships were expected to be announced soon, laying the foundations for further expansion. But, whilst we were mid-flight, news broke of the airline’s collapse. Chinese investment had been withdrawn and the carrier had failed to reach a deal with a potential European investor. Officially, the airline’s bankruptcy was declared just over an hour after we touched down, when the very last commercial flight, from Heathrow to Larnaca landed at 23:50, as I understand is customary in these situations, but it seems people were already ‘in the know’ some hours before this official declaration. This was obviously a sad day for all employees of the airline, many of which I suspect had also been affected by the bankruptcy of Cyprus Airways as recently as 2015. It seems surprising that Cyprus is unable to sustain its own airline given that tourism is the major driver to the island’s economy. With its almost year-round warm temperatures, it is a more reliable destination for Winter sun than many other island options within the Mediterranean, not to mention the beautiful and diverse coastline that has become world-renowned for its quality, consistently receiving awards, accolades and top rankings. Let’s hope the employees find new work soon but, for the remainder of this article, I’d like to focus on our personal experience of this situation and hopefully some of this may be useful to others facing a similar fate either now or in the future. How we found out You would think that we may have heard an announcement when we landed, either when still on board the plane or once inside the airport. Or that fellow passengers might have been chatting about their respective predicaments whilst waiting for their luggage at the baggage carousel. Or that at some point an email might have landed in my inbox. But there was nothing like this. I genuinely don’t think any passengers knew and myself and my family were equally oblivious. The next morning, when the headlines hit in earnest, we were staying at our villa on the outskirts of Protaras (more on that in a later blog post), not watching TV, not following the news and not spending our time on social media, but instead enjoying some quality family time away. I checked my emails occasionally but there was no notification. Mid-way through our time away, we were due to move to another villa nearer the centre of Protaras and I had emailed Athina from Imagine Villa Rentals about the arrangements for the transfer. She had been very helpful with all the logistics prior to travelling and, from earlier correspondence, knew that I was also working for Cobalt. She called me to explain that the villa we were vacating would need to be cleaned since new guests were arriving that day, as would the one we were moving into since it too was only being vacated that morning, so it would just need a little patience on our part. This was not a problem and we took the opportunity to go and have a relaxed lunch in Protaras. Athina also made a fleeting reference to “the problems with Cobalt” in the conversation. I asked what she meant and she told me of the airline’s demise. This was the first we had heard of it. By now it was the afternoon of 19th October so almost 48 hours since news of the bankruptcy broke. It was half term week so flights were already largely full and we suddenly had no means of getting home. Our planned return with Cobalt was going to be on the morning of 24th October, a week after our departure, flying Larnaca to Manchester. Had it not been for this passing mention in our telephone conversation, we may not have discovered there was a problem until we’d returned to the airport, only to find there was no flight. What we did Of course, as soon as I finished the phone call, I went and told the rest of the family the news. We were all somewhat shocked as you can imagine. We immediately went online, first to verify the announcement and, once that was very quickly confirmed, started to look at solutions to get home. By now there were various news articles to help passengers affected, but time was not in our favour. People in a similar situation to ourselves would have already started making new travel arrangements on flights that already had very limited availability. As we started to search different airline websites, we were getting some searches return results with no availability until April! (when flights would be resuming for next season) In addition to frantically finding out what we could, I messaged a number of people. Firstly, Paul Simmons, the Chief Commercial Office at Cobalt, who I had corresponded with prior to working for the airline, to express my sympathies and ask for his advice. He responded very quickly, suggesting two Cypriot companies to contact in order to get “a one-way ticket for repatriation whose cost will be covered by the state”. We attempted to contact both of these but didn’t have much luck – the first said they would get back to us “today or tomorrow” and I didn’t feel very confident about that (they never did come back to me that day and I didn’t feel we had time on our side); the second we couldn’t get through to so I sent an email (they got back to us some time later, suggesting flights that took us back to Birmingham a day later than planned, which is not where we had left our car, of course). I also messaged my travel insurance company, Columbus Direct – more on their response shortly – with whom I had an annual family travel insurance policy. And, having read various references to the Cypriot government helping with the costs of repatriation, I even added Georgios Lakkotrypis, the Minister of Energy, Commerce, Industry & Tourism at the Government of Cyprus to my Linkedin, including a note with my connection request that explained my situation and asked for his advice. He accepted the request, and would have seen this message when doing so, but I haven’t yet received a reply. Meanwhile, my mother found a number for easyjet that was included in an article about Cobalt in the UK press, so we tried that. They couldn’t accommodate us all on one flight, but they had one seat for the 23rd, one seat for the 24th and four seats for the 25th, flying out of Paphos rather than Larnaca, but at least all going to Manchester, ableit landing in the early hours of the morning, at a rescue fare rate of just £80 per ticket which seemed like a lot of goodwill on their part. We made the decision to go back on the flights on the 24th and 25th, with my wife taking the solo flight as she really needed to get back for a number of reasons, and the rest of us following 24 hours later on the plane that could accommodate four of us. This presented us with a number of other logistical hurdles – we all needed to get to Paphos and, since we didn’t have a hire car, we decided the best option was to go in one taxi and the four of us that were staying on to stay the night in a hotel. It was a 2-hour car journey so this seemed like the best option rather than us each make that journey separately. We also needed to arrange accommodation, taxis to the airport from the hotel, a hotel for my wife when she landed in Manchester, transport arrangements for her to get home (so we could use the car for the four of us when we landed), etc. etc. None of it was insurmountable but it did require quite a bit of extra planning. So a quick interlude here to say a very big thank you to the Alexander the Great Beach Hotel for accommodating us at short notice. As you can see, this hotel occupies a prime location right on the sea front. It’s a comfortable, well-equipped hotel with a large outdoor pool – and an indoor conservatory pool – and swim-up bar. The hotel is very family friendly and has no less than four on-site restaurants – Roxane (buffet), Limanaki (Greek tavern), Seven Orchids (pan Asian), and Garibaldi (Italian). It is is part of the Kanika Hotels & Resorts group that is well known for the family hotels of Olympic Lagoon Resort Agia Napa & Paphos, The Alexander the Great Beach Hotel Paphos and Elias Beach Hotel in Limassol, with more than 100 prestigious industry awards. Also, ‘heads up’ to the Paphos Aphrodite Waterpark. Going to the waterpark is always a top day out with our boys so it seemed to make sense to visit this one since it was just a little over a mile from the hotel. We walked there and back but it’s is easily accessible by car or the local bus which drops off right at the waterpark’s doorstep. There are loads of high-thrill rides to enjoy here – the free fall, kamikaze, twister and many more – as well as plenty for those who don’t want to partake in anything too extreme. Other highlights include family rafting, the lazy river which stretches 400m around the park and the park’s famous air-filled wet bubble which offers lots of fun for anyone wishing to attempt to reach the summit. I didn’t take my phone or any valuables with me (thanks to Pixel Holiday for the photograph below – they are an outside photography company working at the park) but there are secure lockers on site as well as free WiFi. It was quite quiet at the time of our visit as a storm was forecast (it never really lived up to expectations) but the lifeguards on duty were friendly, approachable and attentive. A brand new slide is planned for 2019 so watch this space… Once we knew our plans for getting home, we also knew we would be picking our car up almost two days later than originally agreed. This had been arranged through Skyparksecure at a cost of £64.03 for the week so we got in touch with them and this was the response:
Dear Paul Johnson, In response to your Facebook message, we here at SkyParkSecure.com are a Price Comparison Website and act as a Booking Agent for Car Parking Companies at all the major Airports in the UK. SkyParkSecure.com do not own or operate the Car Parks and do not provide the Car Parking Services, our Offices are based in Blackpool and we do not have any direct contact with the vehicles. I have contacted Official Manchester Airport Meet & Greet – T1 on your behalf, and advised them of your new return details. They have advised that they will ensure that your vehicle is brought back to the Meet and Greet area and is ready for your collection upon your return. When you land back into Manchester Airport and have passed through baggage reclaim and customs, you will need to follow the departure procedure on your booking confirmation, making your way to the Meet and Greet area and collecting your keys from the Meet and Greet Reception. The car park will charge you their daily overstay rate of £25.00 per day for the extra days at the car park when you collect your keys from the Meet and Greet reception. If SkyParkSecure.com are able to be of any further assistance, please do not hesitate to contact our customer services team on 0345 4599 250 or via email. Kind regards, [Name removed to protect privacy] Customer Service Team
I have to say I felt a little aggrieved by this. The additional day and a half was going to be not all that far short of the amount that we had paid for the entire week. In contrast to the airlines who were offering rescue fares at rates much lower than they would normally charge, it seemed like it was a different mindset when it came to airport parking – this was an opportunity to profiteer from the misfortune of passengers who were facing circumstances outside of their control. As it turned out, though, when we went to collect the key to our car, there was no further charge made. I don’t know if this was because someone had overruled the decision, or if the fee was forgotten or simply that nobody wanted the task of dealing with that paperwork at 2 o’clock in the morning, but thankfully there were no additional costs in the end. The costs So, what did it all cost to get back home? Here’s a summary of the additional costs incurred: Estimate on phone calls related to repatriation = £15 5 rescue flights with easyjet @ £80 each = £400 Taxi from Protaras to Paphos = €200 Taxi for my wife to get to the airport = €28 Subsistence for my wife at the airport = €7.50 Subsistence for my wife on the flight = £11.95 Night in hotel at Manchester Airport (we used my points but equivalent cost was £160) = £160 Train for my wife to get near home = £35 Taxi for my wife to get from train station to home = £8 Extra night in hotel in Paphos (2 rooms) – gratis (I did work for the hotel in lieu of payment) Subsistence for the four of us remaining in Paphos for an extra day and a half = €213.25 Taxi to airport for the rest of us = €28 In flight subsistence = £3.50 Extension to airport parking in Manchester – not charged Additional day of ‘doggy day care’ for our dog back home = £17 Estimate of tips on some of the above = €50 Total cost: £650.45 + €526.75 Or, to put it in one currency, the actual cost to us was approximately £1,125 (or €1,260), which I don’t think is bad considering this included 5 flights, hotel stays (3 different rooms across 2 hotels), multiple forms of transport and an extension to our stay that led to other additional costs. Had it not been for one or two industry contacts, most notably in the hotel industry, the cost would have been significantly greater. Getting compensated At present, I have yet to receive any form of compensation. As mentioned, I reached out to the Cypriot government via the Tourism Minister having read that they were saying they would bear the costs of repatriation. I don’t know if this is assured and know this isn’t the official channel but was curious to see if I would get a response. As yet, I haven’t, but I might look at exploring this avenue further. I’m really expecting my travel insurance company to bear the cost. I’ve never previously had to make a claim but was rather hoping this would be a straightforward process. So far, though, I’ve been less than impressed. Despite having clearly explained our circumstances in an email and despite a clear statement on repatriation in their policy wording, they replied with this:
Dear Mr. Ian Smith, Thank you for your email. We can confirm if the flight is cancelled by the Airline, you would need to contact them to seek reimbursement/compensation. Alternatively, you my [sic] contact the Tour Operator/Travel Agent. We hope this is of assistance to you. If you have any further queries, do not hesitate to contact us. Kind regards, [Name removed to protect privacy] Customer Services
I have no idea who Mr. Smith is but am guessing it could be someone who had written at around the same time and was facing a similar situation to ourselves. (‘Smith wasn’t the real surname used, by the way – I’ve just replaced it to protect that person’s privacy.) Granted, the travel insurance company did follow up with another email addressed ‘Dear Dr. Paul Johnson’ but by this time I had already starting composing my reply to them and the content of the message was otherwise identical. I re-iterated my original enquiry, explaining that I was not talking about reimbursement for flights paid for, but that I was instead talking about repatriation costs. That was on the 19th October, now almost two weeks ago, and they have not responded. I don’t intend to leave it at this, though! I’ll be chasing the travel insurance company and will refer them to this blog post. I’ll also come back and update the post with details of any outcome. In the meantime, if you have any thoughts on this, any stories of your own to share, or if you were also affected by Cobalt’s insolvency, please leave a comment below. We would love to hear from you. Thank you! UPDATE: 30th January 2019 I’m pleased to report that my travel insurers finally settled my claim and payment came through yesterday. I have to say it wasn’t without quite a bit of hassle along the way, though – annoying little things like they wanted me to furnish them with proof that I had bought rescue flights by forwarding the receipts on to them – I did this and, despite sending them the email receipts I had from easyJet, they still then wanted a copy of my credit card statement as additional proof. Anyway, I got there in the end, but will be looking around at what other options are out there when my renewal comes around. Disclosure: I was working for the now saldy-defunct Cobalt Aero airline, as well as for Imagine Villa Rentals, which I’m pleased to say seems to be going from strength to strength, with over 150 properties in and around the Protaras area. Thanks also go to both the Alexander the Great Beach Hotel and the Paphos Aphrodite Waterpark for hosting us.

Paul Johnson

Paul Johnson is Editor of A Luxury Travel Blog and has worked in the travel industry for more than 30 years. He is Winner of the Innovations in Travel ‘Best Travel Influencer’ Award from WIRED magazine. In addition to other awards, the blog has also been voted “one of the world’s best travel blogs” and “best for luxury” by The Daily Telegraph.

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  1. I am still waiting for my travel agent to give me a refund for my flight. I am back in Chicago now, and I paid on my own for the cancelled flight. The one from Larnaca to Zurich. The good news, I had enough time to react, and fix my problem. The bad news I paid 400 dollars.

    1. Hi Chris… thanks for stopping by. Did you have travel insurance? Failing that, might also be worth looking into whether your credit card company (assuming you paid by credit card) can offer support. Good luck… Paul

    2. I did not have travel insurance, but my American travel agent “Liberty Travel” promised to reimbursed me. It is one of the few remaining travel agencies in America, and one of the best. Here is a youtube link of ABC news here in America when they profiled this company in 2011. https://youtu.be/2vPJoJUld8o

    3. Yes, I did get it in writing. Liberty Travel connects with people here in America like no other travel agency. I have been using their services since 2012.

    4. Sounds like you should have nothing to worry about then, Chris. Maybe you’ll need to chase it, but by the sounds of it it’s probably just a case of them getting around to processing it.

    5. Please unsubscribe me from getting notifications for this page. I do not want to receive any more notifications via email

    6. Hello Chris, if you have checked the box to receive notifications, then these will be sent to you whenever there is a new reply. To unsubscribe from these, you just click on the relevant unsubscribe link that accompanies all of those emails. Hope this helps, Paul

  2. Monarch, Primera and now Cobalt – another season and another airline bankruptcy. You would be wise, before booking a carefree holiday, to ponder who will be next?

    The airline industry has always been difficult. Initial capital costs of purchasing aircraft are prohibitive barriers to entering a troubled industry, alternatively you face the consistent albatross around your neck of hefty leasing costs for the fleet of aircraft as Cobalt did.

    As we scour the Skyscanning websites of this world for the ultimate low-cost bargain flight we tend to forget the economic realities of a cutthroat industry. At many airports just touching those wheels down on the runway incurs a charge of thousands of pounds.

    Media attention has focused critically on Ryanair’s attempts to monetise every custom whim but it has to be remembered they are are still in business.

    Business strategists may well question Cobalt’s Business Plan. They jumped hastily into the breach after the bankruptcy of Cyprus’ National Airline in 2015 – and only kept their heads above water for just over 2 years.

    Hindsight is a wonderful thing but why did Cobalt believe they could survive and profit where others had failed? Was their cost structure significantly lower than their predecessor? Would their pricing policy create the necessary safety margin?

    Sadly from now on when we book a budget airline perhaps we need not look just at the price but also at the balance sheet and say a prayer too.

    1. Hi Gerald – the UK press seems to think that it’s the smaller airlines that are most at risk ( https://www.theguardian.com/business/2018/oct/18/cobalt-cyprus-european-airlines-explainer ) although I’m not sure Monarch would be classed as small (110,000 passengers had to be repatriated in that instance). A low-cost airline in Africa called Fastjet seems to be the latest airline at risk. It was set up with the backing of easyJet’s founder, Stelios, back in 2012, but sounds like it is running out of funds… difficult times not just in Europe, it seems.

  3. Such a pity! Cyprus is an absolutely brilliant half-term location. As you found out there are plenty of top-end villas and some luxurious 5* hotels too.

    I love the place. A dose of education into the classical atchitecture for the kids, just because it’s half-term doesn’t mean that they can switch off their brains, and a lot of sandy Blue Flag beaches for some relaxation.

    I just hope an airline or two will be able to pick up the slack, even if we have to pay a little extra for flights to prevent this disaster from happening again.

    1. Hi Jane… yes, it is a shame. Of course, there are already multiple airlines flying there so I don’t think there will be any problems with provision.

      From London alone, there are direct flights to Larnaca from London Heathrow (LHR) with Aegean and British Airways and from London Gatwick (LGW) with Thomas Cook Airlines, British Airways, and easyJet. London Stansted (STN) has direct flights with Jet2. And to Paphos, easyJet fly from Gatwick and Ryanair from Stansted.

      Of course, you can also fly from a number of other UK airports also.

  4. I’m genuinely sad Cobalt closed down. I’m still hoping they will recover and will be flying again soon.

    Cobalt had indeed recruited those who had lost their job when Cyprus Airways, another great Cypriot airline went into administration in 2014 (Cobalt employees sent a letter to the Minister of Transport in which they expressed their gratitude for their employer, to put an end to speculations and fake news). I don’t think the Cobalt execs expected to reach to a point they had to stop flying and even the day it actually happened they still tried until the very last minute to find an investor and they still advertised their destinations. Cobalt had a huge potential I think. And the last thing they wanted to do was to have to cancel flights and create chaos.

    I flew with Cobalt for the first time last September and it was worth more than I paid. Comfortable seats, great service, friendly staff, I loved the fact the air con was not on that high (I’m one of those people), and for me personally it was even more special because most of the staff were fellow Cypriots and to hear Cypriot even before I get home, it was truly wonderful.

    At the beginning of the month (October) I booked my Christmas flights home. I live in Southampton,UK and I usually fly home a couple of times a year, and Christmas is one of those times. I left it late and I had to pay the price. Most flights were ridiculously expensive, but I found a cheap one with EasyJet to get me to Larnaca on the 21st of December and a relatively cheap (compared to the rest of the flights on the 2nd of January with convenient times and airport) with Cobalt and I actually booked business class because it was cheaper than Economy, the magic or better the craziness that is Christmas flights.

    Two weeks later Cobalt goes bust. I had no travel insurance (not sure that would have covered it), I used a debit card, so section 75 of the Consumer Credit Act didn’t cover it (I’m getting a credit card to use from now on for any purchases over £100) and I booked it directly with Cobalt, no travel agents. So I lost my money. Well I thought I did. I filed a claim through the Visa Chargeback with my bank. They temporarily refunded me until they hear from Cobalt’s bank, since they requested further information, which don’t actually know what it means, it will be cruel if they take the money back.

    That’s not the worst part. Due to Cobalt closing, the ticket prices sky rocketed and I had to pay £380 for another flight on the 2nd of January.

    Many have commented on how calm I was about the whole thing. Well there’s nothing I can do and it could have been worse. My sympathies to everyone who got stranded in another country and lost money they couldn’t afford to lose and also to all the Cobalt employees who were left with no job.

    Oh and if you get the chance, visit my little island. It really is a great destination. Mountains, crystal clear blue water, incredible food and Greek hospitality at its best!

    1. Hello Eleni – thank you for dropping by and giving an account of your first-hand experience. I hope you get to keep the refund – otherwise, as you say, it’s a double blow given that you’ve had to pay for another expensive ticket. Safe travels, Paul

  5. Norwegian also have the option of accessing their onboard entertainment and information through WiFi.

    However, I am of a senior generation that does not automatically carry headphones around with them. For fifty percent of my flights with Norwegian I’ve sat there watching “silent” movies as I’ve forgot to take my headphones.

    1. Hi Bob… probably not something you want to make a habit of, and may not apply to you, but this is from the Norwegian website:

      Will I receive headphones onboard?

      You can buy headphones onboard (only available for flights to/from USA, Argentina, Singapore and Thailand) If you want, you can bring your own headset onboard.

      Find out more about our inflight entertainment.

  6. Paul,

    Great reporting. I felt like i was there :).

    I’m shocked that your travel insurance company is so sloppy.

    Its sad that when airlines go under, there’s no chance of immediate help.

    I keep saying that these cheap fares are not sustainable by the airline; something has to give, but there seems to be a new airline every month and consumers are consumed by cheap fares.

    1. Thanks, Kerwin… always good to hear from an aviation expert! I messaged the travel insurance company with this post after publication yesterday. Hopefully that might make them take notice and respond more professionally.

  7. Hi
    We were affected by the cobalt closure and we were flown back to Abu Dhabi by the Cypriot Government. I called a number listed on a Cobalt related website and we were issued tickets on Gulf Air with no additional charges to us.

    1. We chose to stay an extra day and then flew from Larnaca to Dubai with a short stop in Bahrain. Dubai was our final destination anyway.
      We are pursuing a refund of our loyalty cards through our credit card supplier. Sadly we never got a chance to use our three complimentary upgrades with Cobalt.

    2. There were two of us travelling and as we have a house it Paphos it did not affect us too much. Have to give credit to Topkinisis Travel in Nicosia who sorted everything for us on the phone.

  8. There is a moral to this. It is worth taking some time to check out your travel insurance. For at least 25 years, and several holidays a year, I haven’t needed insurance, and have tended to buy cheap cover just to tick the box saying that I had cover.

    This year I finally needed cover and my travel insurers, who I thought were a highly reputable bank, would not pay up. Needless to say I won’t be using them again.

    Any recommendations for good travel insurance?

    1. Yes, but it’s easier said than done, since there is so much small print and you never know quite what reason one day you might need to claim.

      Also, I’ve since looked at the reviews for my travel insurance company, and largely they are positive. However, when you start to scrutinise it in more detail, I invariably seemed to discover that the positive reviews were those who had taken out a policy and had been happy with their service to that point. The handful of negative reviews seemed to be those who were faced with making a claim (of course, you would expect that to be a minority) but were not happy with the service they were getting. In an ideal world, it would be good if these services were only reviewed by those needing to make a claim IMHO, then we might get a true picture.

      I have looked at my policy wording and, to my mind, it is very clear that I should be covered, yet they seem to be intent on making the process of claiming more difficult than I think it should be. We’ll see what happens and I will update you in due course.

  9. I enjoyed your article and read it out loud to my husband. Thank you for sharing it!

    As a professional travel advisor for the last 25 years here in the U.S., I’ve assisted my clients through all kinds of situations that they needed to file a claim on their travel insurance policy.

    This occuranance won’t be looked at as a cancellation, but as Finacial Default of a travel provider.

    You need to make sure that Financial Default is a covered benefit…otherwise sadly, you may be on your own.

    I will be checking back for updates & wish you all the best in achieving a resolution that is favorable.

    ~Trish Gastineau

    1. My travel insurance policy includes what is termed “Scheduled Airline Failure Insurance”.

      The wording in my policy reads:

      The Insurer will pay up to the amount shown in the policy documentation in total for each person-insured named on the Invoice and on the Airline

      Ticket for:
      1. Irrecoverable sums paid prior to financial failure of the scheduled airline not forming part of an inclusive holiday prior to departure; or
      2. In the event of financial failure after departure:
      a. additional costs incurred by the Person-Insured in replacing that part of the flight arrangements to a similar standard of transportation as enjoyed prior to the curtailment of the travel arrangements; or
      b. if curtailment of the holiday is unavoidable
      – the cost of return flights to the United Kingdom, Channel Islands, Isle of Man or Northern Ireland to a similar of transportation as enjoyed prior to the curtailment of the travel arrangements.
      Financial failure means the Airline becoming Insolvent or has an administrator appointed and does not fulfil the booked flight(s).

  10. Great article about Cobalt. I had a similar experience.

    I know you’re in the industry, and was wondering if you had any update on whether Cobalt will go into insolvency?

    1. Hi Max – thanks for dropping by and sorry to hear you had a similar experience. What is your story?

      As you point out, and despite the press coverage of the airline’s failure, Cobalt haven’t officially declared themselves bankrupt as yet. They have ceased operations but not yet declared insolvency. In my particular case, this means that the travel insurance company won’t entertain the claim just yet, and nor will the Cypriot government it seems.

      I did receive a response from the Tourism Minister of Cyprus. He provided me with an email address for the Cypriot Ministry of Transport, Communications and Works and advised me to make contact there. After doing so, I got a reply from the Air Transport and Airports Section of the Department of Civil Aviation in Nicosia who basically said:

      Kindly note that based on the information we have acquired CobaltAir Ltd. has ceased commercial operations on 17/10/2018. Regulation (EC) No 261/2004 only applies to active/solvent airlines.

      We therefore regret to inform you that the Department of Civil Aviation is currently unable to provide you with further assistance concerning your query/claim for CobaltAir Ltd.

      The Department of Civil Aviation considers your case closed.

      Not very helpful!

      I wrote to Paul Simmons, who is a contact I have on Linkedin, where he used to be listed as Chief Commercial Officer at Cobalt (but isn’t any longer). He kindly replied same day and said this:

      Paul – the position of the directors is that Cobalt is not currently insolvent although it’s bank accounts are frozen following creditor litigation. It has effectively got a few more weeks to find a new investor or face formal liquidation. Unfortunately you will therefore have to wait a few weeks for events to play-out.

      Best regards,


      This was back on 6th November, when he was still listed as CCO.

      Since then, all I’ve seen is that the Greek company Diversa was considering an acquisition of Cobalt New Age Airlines Group Limited, the 100% owners of Cobaltair Ltd. shares. That was two weeks ago, though…

      Has anyone else heard an update?

    2. Hello,

      I came across your blog while looking for people who may be in a similar position! I was on holiday near Athens when Cobalt cancelled all flights – and so had to book new flights with another company. I’ve got nowhere with making a claim through my travel insurance, as Cobalt have not officially filed insolvency (plus we booked using a debit card). It’s also been difficult to find out information. If you have heard any new updates about their status, I’d greatly appreciate hearing about them!

    3. Hi Katie – thanks for dropping by and commenting. It sounds like your situation is quite similar to ours in that your travel insurance company is refusing to honour your claim until the bankruptcy is deemed official. I take it your policy includes cover for scheduled airline failure… what does it say exactly and who was your policy with? I’m afraid the latest update I have is the one that you see just above from a few days ago…

  11. I’m sorry for all your challenges on this trip. What I’m most interested in learning more is how your Travel Insurance woes worked themselves out…if they actually did.

    I certainly hope you include a post about what works and what doesn’t in that nightmarish realm of insurance,

    As an owner of a vacation rental, I frequently advise my guests to purchase travel insurance to protect their vacation investment. But honestly, I have ignored that advice more often than not.

    The few times I have purchased Travel Insurance on flights it was to assure that if there was a weather-related problem I could still get from point A to B at no added costs. So far I’ve been lucky and I’ve not come across anyone who has had to use their insurance.

    But as we enter the winter season, it’s not uncommon to have the roads flood and passage to our home closed as a result. I’m concerned about the troubles our guests might face when their trip is interrupted as yours was.

    And I still wonder if it’s worth the added expense to have nothing to show for it.

    1. Hi Donna – as yet, it’s still unresolved whilst we await official confirmation on the insolvency. I also have a rental property in which I strongly advise guests to do the same (take out travel insurance). Whenever someone needs to cancel, my first question to them is ‘did they take out travel insurance?’ and invariably the answer is ‘no’, sadly. Despite my ongoing problems in this instance, I would always advise people to take out insurance. The cost is relatively minor in the scale things and, whilst it could be just to cover you for a cancellation because of a flooded road, it could be something for much more serious and costly such as a medical emergency. Better to have some kind of cover rather than none at all, even if insurance companies do have a horrible reputation for trying to avoid paying out when really they should…

  12. As I understand it,
    you were offered a flight back to Birmingham, arriving the da after you planned return, form the right airport and a a group.

    Given the situation ou were in, I would have taken that original offer and then found a way to recover your car from Manchester airport. Maybe by getting a friend to pick up your car and meet you at Birmingham.

    Home sooner, as a single group and at less cost and additional travel for all of you.

    My advice, when things go wrong when traveling, take the earliest opportunity to get back on home turf where you have a lot more control of additional costs.

    1. Hi John

      Thank you for commenting. I’m sorry not to publish your comment straight away but, although I do not agree with your argument, I didn’t want it to jeopardise my claim.

      Anyway, as you may have seen from the update at the end of the post, the travel insurers have now settled my claim, so I am happy to publish and respond as to why I disagree with what you had to say.

      You say that we should have taken those flights and somehow found a way to recover our car from Manchester Airport, suggesting a friend pick it up and meet us at Birmingham. I’m not sure how you felt this would happen, but I don’t see it as realistic. Birmingham Airport is approximately a 3-hour drive from our home so, assuming we were somehow able to find assistance from someone near where we lived (that’s where most of our good friends are), we’d be asking them to take a full day out just to resolve our dilemma (6 hour return trip, not factoring in additional time to speak to airport parking to pick up keys, arriving in ample time, allowing for traffic, etc.), not to mention the additional work and cost involved in trying to get them added to our vehicle insurance policy.

      To ask a friend to take a day off work, just in order to resolve our situation, is an unreasonable request in my opinion, and I wouldn’t wish to put a friend in the awkward situation of feeling compelled to help us even though they may have had other commitments.

      You also claim that we would have got home sooner by this method, which is not the case. My wife actually got back home well before these offered flights would have even landed, and we returned on the same day as them (and to a nearer airport).

      Thank you for your input, though – all comments are welcome, whether I agree with them or not! :-)

      Best regards,



    Cypriot carrier Cobalt has gone into liquidation with Stephen Michaelides of Grant Thornton being appointed as the official receiver.

    According to information disclosed by the company, notices relating to the winding up procedures, including announcements for the disposal of assets of the company, will be posted on its website.

    Those interested in further information are invited to contact the Clearinghouse office at 22600000 or at cobalt@cy.gt.com or by post at 41-49 Agios Nikolaos, Nimeli Court, Block C, Engomi 2408, PO 23907 , 1687, Nicosia, Cyprus

    Cobalt closed down in October last year after accumulating debts of over EUR 100 mln with the Cyprus authorities stepping in and revoking its license.

    The airliner at the time had a significant share of the traffic to and from the island carrying 120,000 passenger annually, a void yet to be filled by other airliners.

    Cobalt was launched only in 2015 with its flight schedule from Cyprus commencing in July the following year. The company came to fill the void created after state-owned Cyprus Airways went bankrupt in January 2015. Cobalt went on to become the island’s biggest airliner.

    Employing many pilots from the defunct national carrier, Cobalt was operating 13-15 flights daily, carrying up to 3,000 passengers to 23 destinations including Athens, Beirut, Heathrow, Paris and Tel Aviv.

    Rumours that the company was to stop operations started circulating in October when its Chinese investors left Cobalt, but the airline denied the speculation.

    On October 17, the company announced immediate termination of its flight schedule calling on passengers not to go to the airports as all flights were cancelled.

    The following is the update on the Cobalt site:

    Υπό Εκκαθάριση – In Liquidation
    H Cobaltair Ltd έχει εισέλθει σε διαδικασία Εκούσιας Εκκαθάρισης στις 19 Δεκεμβρίου 2018. Ο κ. Στέφανος Μιχαηλίδης της Grant Thornton Specialist Services Limited έχει διοριστεί σαν Εκκαθαριστής.

    Ανακοινώσεις σε σχέση με την πορεία της διαδικασίας Εκκαθάρισης, συμπεριλαμβανομένων ανακοινώσεων για διάθεση στοιχείων ενεργητικού της Εταιρείας θα αναρτώνται σε αυτή την ιστοσελίδα.

    Για περαιτέρω πληροφορίες παρακαλείστε να επικοινωνείτε με το γραφείο των Εκκαθαριστών στο τηλέφωνο 22600000 ή στο cobalt@cy.gt.com ή ταχυδρομικώς στην 41-49 Αγίου Νικολάου, Nimeli Court, Block C, Έγκωμη 2408, Τ.Θ 23907,1687, Λευκωσία, Κύπρος.

    Cobaltair Ltd entered into voluntary liquidation on 19th December 2018. Stephen Michaelides of Grant Thornton Specialist Services Limited was appointed Liquidator.

    Announcements in connection with the liquidation process, including various assets which will be disposed, will be posted on this webpage.

    For any other information, please contact us by phone 22600000, by email at cobalt@cy.gt.com or by post at 41-49 Agiou Nicolaou Street, Nimeli Court, Block C, Egkomi 2408, P.O. Box 23907, 1687, Nicosia, Cyprus.

  14. Oh dear – here we go again?

    The Economist is carrying a report that Norwegian have reported heavy losses –
    “On February 7th Norwegian said it had made operating losses of NKr3.85bn in 2018, during which almost half of its flights were on long-haul routes.”

    Norwegian had been successful in its early years when its focus was primarily short-haul but it has been markedly less profitable when it has expanded to transatlantic routes.

    The Economist quite rightly fears that the demise of Norwegian would ease competitive pressure on the remaining major companies crossing the pond pushing up prices.

    Although I have noticed, looking at prices and assessing a trip to the US, that some prices are ridiculously low, sometimes below the £300 mark (without luggage and designated seat etc etc). I did question how long those prices could be maintained.

    I hope that we are not looking at another Freddie Laker scenario.

    1. I think Norwegian even had some flights to New York for just £160 recently. Judging by the share price, which has tumbled this year, I don’t get the sense that there’s a great deal of confidence in the airline at present.

    2. Any idea what the word on the street is about Norwegian? They’ve got some great prices for European trips in the summer but I just don’t know whether I should take the risk or not. I’d hate to get stranded somewhere.

    3. Well, the grounding of its Boeing 737 MAX aircraft apparently affected them quite badly as it made up a significant part of their fleet (over 10%, I think). I wouldn’t like to say… I’d just make sure you have travel insurance and read the small print on the policy you intend to purchase.

  15. it is all good paul. a very informative post. I’m still hoping it will recover and will be flying again soon.

  16. I’m thinking of booking some flights for a Med getaway in July though I’m worried about the financial stability of some of the budget airlines. I’ve heard some rumours of bankruptcies flying about. Any truth in them?

  17. I’ve done a lot of budget airline flights recently and it’s made me realise how tight the margins are. Passengers are queuing up to get on as the last passenger disembarks. It just takes a couple of things to go wrong and the airline is struggling.

  18. I’ve just booked a couple of seats with a budget airline. Having read this a few of months ago certainly changed my behaviour, there’s one airline, who had the cheapest seats, but they also have the most rumours flying about their future, so I went with an airline who I hope are more secure even though they were more expensive. I think these bankruptcies are going to hang over the industry for a long while.

  19. That degree of uncertainty, in the pit of our stomach, as we heard to the airport may be the price that we have to pay for lower prices.

    I can remember, probably back in the 1990s, someone complaining that a return from Heathrow to Nice would have cost them £600. Factor in inflation on top of that and you get some idea of how expensive flying was before the budget airline revolution. No one would dream of paying those sorts of prices nowadays.

  20. Whilst a difficult time, if only we knew then a company as large as Thomas Cook could follow suit. Awful and it seems insurance companies must improve as they seem particularly difficult in such cases. I’ve supported friends and customers alike in disrupted times and yet the creativity we find in such situations to provide resolution seems only to be met by that of insurers to provide obstacles.

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