What is a package holiday and why should you book one?

Here at Which? Travel we always advise you to book a package, rather than buying your flights and hotels separately. 

But not everyone’s convinced. Only four in 10 holidays were booked as a package last year, according to the Office for National Statistics (ONS). That means the majority of trips weren’t protected by the Atol scheme or the Package Travel Regulations (PTRs) if anything went wrong. 

But with mass travel disruption caused by staff shortages, wildfires and air traffic control failures in recent years, these protections have become all the more important. 

Read on to find out what these protections mean in practice, and how you can sometimes save money by booking a package.

Find out which package travel companies we recommend in our survey of the Best and worst package holiday providers

What is a package holiday?

If you buy two major elements of a holiday – flights and accommodation, for example  – in a single transaction, from the same travel company, then you’ve booked a package. 

The nature of that holiday is entirely up to you. You could spend a week sunning yourself on the beach in Benidorm, skiing in the Alps, cruising on the Med, or cycling across Sri Lanka on a guided tour. All are packages, as long as you booked two elements of the holiday with one company and it lasts for longer than 24 hours.

Any package holiday booked in the UK automatically benefits from the Package Travel Regulations (PTRs), which help to ensure that you get the holiday you paid for. 

Read more about the Package Travel Regulations

What is Atol protection?

If you've booked a package and it includes a flight, then you will also benefit from Atol protection. 

All travel companies that sell package holidays with flights to UK customers are legally required to hold an Atol licence. 

If a travel company with Atol protection goes bust, the scheme protects its customers, making sure they don’t get stranded abroad or lose money.

Read our guide: How do I know whether my my holiday is Atol protected?

Six benefits of booking a package holiday

1. Package holidays are cheaper

Holiday companies have long argued that packages are cheaper than booking all of the elements of a holiday separately, because they have access to discounts that they can pass on to the consumer, and their exclusive holidays can’t be booked anywhere else.

But can this be true? Can you really get all of this financial and legal protection at a lower rate? When Which? Travel looked into this, we found that in many cases it is true, but it depends on the destination.

Our research looked at all-inclusive packages (arguably the more expensive end of the package market) and found that packages were cheaper than independent holidays in seven out of 10 popular destinations. 

2. You’ll be flown home in a crisis

If your holiday company goes bust while you're away, you’ll be brought home under the protection of the Atol scheme. 

When the original Thomas Cook collapsed in 2019, nearly 150,000 holidaymakers were flown home by the UK government as part of the biggest repatriation in the UK’s peacetime history. 

On this occasion, both package and flight-only customers were repatriated, but under normal circumstances holidaymakers not on an Atol-protected package (any package with flights) could be asked to find and pay for their own way home. 

Thomas Cook package customers also had their accommodation costs covered by the government, until they were able to get on a repatriation flight.

In most cases, if the company fails while you’re on holiday, package holidaymakers will be allowed to continue with their holiday and be flown home at the end. 

Similarly, if there’s a crisis while you're away, and it's not safe for you to stay, your tour operator should help to get you home – if you’ve booked a package. 

The law states that if something happens that 'substantially affects the performance of the package', the package organiser must repatriate the traveller without undue delay and at no extra cost. If the tour operator is not able to immediately get you home due to 'unavoidable and extraordinary circumstances' it must bear the cost of accommodation for up to three nights.

You shouldn’t need to do anything. Your tour operator will arrange flights, get you to the airport and refund any out-of-pocket expenses. And if your holiday is cut short, you’ll receive a refund for the unused days. 

Even during the wildfires in Rhodes, when the FCDO didn’t change its advice, it was package holiday companies like Jet2, Tui and easyJet Holidays that led the way in evacuating affected holidaymakers.

3. You’ll be looked after if your flight is delayed or cancelled

Flight cancellations are a massive headache. In the wave of delays and cancellations that have plagued the past few years, many customers have been stranded abroad and had to arrange additional accommodation and transfers. They’ve also had to bear the expense themselves until they can claim on travel insurance.

If you’ve booked a package and your flight is cancelled, your package organiser is responsible not just for getting you home but for all the other elements of your holiday, including sorting transfers and any extra accommodation that’s required – at no extra cost to you. 

And if it fails to do any of these things, it will have to offer you a refund for the entire package. 

4. You’ll get your money back if your package holiday is cancelled

The Atol scheme also protects your money if a company involved in your holiday goes bust before you depart. In the case of the Thomas Cook collapse, around 300,000 customers whose holidays had been cancelled got their money back.

And if the UK FCDO issues a warning against all but essential travel to your holiday destination, you’ll also be given the option of deferring your holiday or going elsewhere. 

Those who’ve booked their holiday independently don’t have these guarantees and will be reliant on the goodwill of their airline or hotel to get any money back.

During the pandemic, travellers who’d booked flights and hotels separately found it much harder to get refunds. Often this was because the flight was still operating, even if there was barely anyone on it. Generally, if the flight departs, airlines will refuse a refund. 

5. You’ll be compensated if your package holiday isn't up to scratch

The Package Travel Regulations are there to make sure you receive the package holiday you paid for. 

We’ve all heard the horror stories of holidaymakers turning up to a half-built hotel, where the pool is filled with algae and the food is inedible. If any of these things happen, your package organiser has to put it right, at no extra cost to you. 

Even if it’s not that extreme, if your accommodation is not as you were led to believe, it should be put right. Examples include if your ‘beachfront hotel’ is a fair walk from the beach, if you’re given a lower standard of room, or even if a key facility such as the Kids Club is closed.

And if the package organiser fails to put it right, you have the right to claim compensation for any out-of-pocket expenses and any loss of enjoyment (the disappointment and distress caused by things going wrong). 

6. Package holidays are just easier

If you book independently, you’re dealing with several companies and multiple moving parts. It takes a lot of time and trouble to make sure you match up your flights, transfers and accommodation. And if for any reason one element of your holiday has to change, you’ll find yourself stuck on the phone, trying to reassemble the other elements. 

Packages, on the other hand, are often hassle-free. All you have to do is pay for the package and turn up. And if you need to make any changes, or you require assistance along the way, you have j.ust one point of contact. 

Of course, this is only true if you’ve booked with a reputable package holiday company. During the pandemic, some of the budget online travel agents chose to ignore their legal obligations when it came to helping and refunding their customers – even those who’d booked packages.

We’ve reviewed dozens of package holiday companies, from Audley Travel to Virgin Holidays. Read our package holiday company reviews

Any type of trip can be a package holiday

For some people, packages conjure up images of throngs of people armed with towels, racing to secure a sunbed around the pool. But the idea that packages are only available for fly-and-flop or all-inclusive holidays is a myth. 

First, you can choose packages on any board basis – from self-catering to bed and breakfast. And second, any type of trip can be a package. City breaks, ski trips and even cruises can be sold as package deals, provided you book two elements of the holiday and pay for them in one transaction. 

And with a good escorted tour package provider you could climb Kilimanjaro, cycle through Cuba or go wildlife spotting in the Shetlands, with a group of like-minded travellers and the full financial protection that packages afford. 

We asked more than 8,000 holidaymakers about their recent package holidays and have rounded up the best and worst providers of all kinds of package holidays below:

• Best and worst city break package providers
• Best and worst escorted tour package providers
• Best and worst self-guided tour package providers
• Best and worst walking holiday package providers
• Best and worst cultural tour package providers
• Best and worst tailor-made holiday package providers

Before planning your next trip, read our Holiday checklist – 18 essential steps to a hassle-free holiday.