New Tour Plan Can Help Travelers Get Refunds : Protection: Travel industry trade associations can assist the public in getting money back from trip operators but can’t guarantee payment.

The American Society of Travel Agents has made it easier for travelers to get refunds from tour operators in case a trip gets canceled.

As of Jan. 1, consumers can seek a refund if any of 41 tour operators participating in ASTA’s tour protection plan fail to provide a refund for a canceled tour within 120 days after cancellation. The plan, according to Paul Ruden, senior vice president of legal, industry and government affairs for the trade association, also covers circumstances in which the tour operator has failed to pay airlines and hotels for various tour arrangements, forcing the traveler to, in essence, pay a second time at the destination and then seek a refund.

The catch is that for the protection plan to go into effect, the tours must be purchased through a travel agency that is a member of ASTA. ASTA claims a membership of about 11,000 travel agencies, out of a nationwide total of between 35,000 and 40,000.

Another advantage of the ASTA tour protection plan is that the refund process begins as soon as the tour operator ceases operations. Previously, the tour operator had to first declare bankruptcy before the process could begin. ASTA has also raised the total amount of money available for refunds for each tour operator participating in the program from $150,000 to $250,000.


By contrast, the U.S. Tour Operators Assn. has a $5.25-million bond to provide refunds if a member ceases operations. However, many travelers complain that trade associations lack real clout in legal disputes.

In general, consumers should realize that they have few--if any--guarantees when signing up for trips offered by tour operators, unless the operator guarantees its departures in advance, which few do. Nor are there any guarantees that the tour operator itself will stay in business.

Buying trip cancellation/interruption insurance offers protection in case the consumer decides to cancel or change his or her plans. But it offers no protection in case the tour operator goes out of business.

Some travel insurance policies do offer protection against the default of tour operators as well as airlines. Paying for tours via credit card is a good idea, too. That way, you can ask the credit card company to simply void the sale if a service isn’t performed.


Though the public may expect travel agents, as a result of their frequent dealings with tour operators, to be a good gauge of who’s reliable and who’s not, even agents can miss the mark. An ongoing $3-million class-action lawsuit, first filed in January, 1990, against Hemphill Harris Travel of Los Angeles by close to 200 consumers seeking refunds for canceled trips during the summer of 1989, when the company ceased operations, includes the allegation that some travel agents reportedly continued to sell Hemphill Harris tours and send consumer money to the operator even after it was widely reported that Hemphill Harris was on shaky financial ground.

Some observers argue that agents should be held responsible for reimbursing clients when a tour operator doesn’t provide services if the agent knew or should have known that the operator was in financial trouble.

When a problem occurs with a travel agency, consumers are often referred to ASTA or the Assn. of Retail Travel Agents (ARTA). Not all travel agents, however, are members of their trade associations. Nor are all tour operators members of USTOA.

“First, consumers should keep in mind that a trade association such as ARTA is established for the benefit of its members, not for consumers,” said Patty Campbell, former chairman of ARTA and head of Carlson Travel Network/All Travel in Northridge. “But we do try to resolve conflicts, and if we find a member not living up to our code of conduct, we can terminate their membership. However, we lack the authority to enforce any sort of payment or settlement.”


Said Stan Bosco, manager of consumer affairs for ASTA: “We can help consumers in some cases, but travelers should understand that we don’t have the power to compel someone to make a refund. ASTA will act as a third party in an attempt to informally mediate a dispute. If a member is found in the wrong and refuses to compromise or settle or even respond to our letters, that can be grounds for suspension or loss of their membership.”

“We don’t function as a mediator; that’s too ‘legal’ of a term,” said Bob Whitley, USTOA executive director. “We just put the parties into contact with each other, but we can’t make a member issue a refund.”

The USTOA currently has 42 members. Whitley estimates the number of “major” U.S. tour operators to be about 100.

Though trade associations such as the ASTA can’t guarantee consumers a refund after a tour is canceled--even if the consumers are found to have a valid complaint--it is probably still worthwhile for consumers to seek the refund. “Most companies want to resolve complaints,” Bosco said.


For starters, it’s always best to try to solve a problem while you are traveling. Don’t wait until you get back. If you lodge a complaint with a tour company upon return, do it as soon as possible and direct it to the president or general manager of the company. Be specific on what happened, when and why, and what you want in terms of compensation.

According to Bosco, most complaints to ASTA involve consumers seeking refunds for canceled trips.

“If it’s a question about service, then it may not be worth contacting us,” Bosco said. “Quality is a very subjective thing, and what’s considered comfort by one traveler may be roughing it for another. There has to be a specific complaint of something you were supposed to get and didn’t.”

Most consumer complaints that USTOA receives, according to Whitley, involve refunds on hotels--especially at international destinations. “People complain that the hotel was described as first-class and they didn’t think it was, or that the hotel was supposed to be easily accessible to sightseeing attractions and they had to take a cab,” Whitley said. “Nothing can usually be done about such complaints.”


Hotel classifications are often confusing to consumers. “What’s considered first-class in one area may not be rated as first-class in another area. Sometimes people buy a budget tour and still expect a top-quality hotel,” Whitley said.

Associations such as ASTA welcome calls from consumers seeking guidance in selecting tour operators or information on travel companies.

“If people contact us about a specific company, and many do, we can let them know if we’ve heard about the outfit and if they’re considered legitimate,” Bosco said. “This can help avoid telemarketing scams. We can also say if a company is a member of ASTA, and possibly how long it has been in business. We don’t make recommendations, but we can reassure or alert consumers.”

Here’s a list of the major trade associations mentioned above: ASTA, 1101 King St., Alexandria, Va. 22314, (703) 739-2782; ARTA, 1745 Jefferson Davis Highway, Arlington, Va. 22202-3402, (800) 969-6069, and USTOA, 211 East 51st St., Suite 12B, New York 10022, (212) 944-5727.