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Buying a Tour Package Without Getting Burned
November 20, 1995 -- When Peter and Whitney Hansen decided to plan a family trip to Norway, they contacted the Scandinavian Tourist Board in New York and asked for a travel agent who could help them book a package tour. The tourist board was happy to "recommend" two agents. Unfortunately, one of the agents nearly finagled the Hansens out of about $13,500, the cost of six packages.

The Hansens should have known better, because there were plenty of warning signs: The so-called agent worked from an apartment, not a storefront. He demanded payment by check or cash instead of a credit card. And his invoice sheet was rubber-stamped, not printed.

The Hansens' bitter experience--and the abrupt shutdown earlier this year of two well-known tour operators--sounds a wake-up call for all travelers. You should purchase tour and travel packages with extreme care and you must guard your financial flanks.

Here's how to avoid getting burned.

DON'T GO IT ALONE
The Hansens violated a travel basic. They did not use their own travel agent but instead worked with a total stranger. The best source for tour-package information is the travel agent you already consult for your other travel needs. Your agent deals with tour operators daily and knows which operators are reliable, what each offers and which ones have treated other clients well. Another good source of information? Friends and family who have purchased and used tour packages. Ask them the name of the operator they used and What their experiences were.

DON'T BE MISLED BY THE BIG NAMES
Tour operators generally fall into two groups: operators unfamiliar to the average traveler and operators with recognizable names and national reputations. Neither ensures reliability. Just because you've heard of a tour operator does not mean that the company is trustworthy. Conversely, a firm called Certi?ed Vacations is virtually unknown to travelers, yet it packages many of the tours sold by American Express, Delta Air Lines and the American Automobile Association. Moreover, name recognition is no guarantee of financial stability. Hemphill Harris was one of the most respected operators in the nation when it slid into bankruptcy in 1989. And the two big operators that folded this year--Club America Vacations and Singleworld--were considered top-notch firms.

READ THE FINE PRINT
Don't be seduced by the gorgeous color photography and purple prose of a tour brochure. The most important information is contained in the small type, under a headline like "Terms and Conditions" or "Important Information."

As explained on the accompanying chart, some of what is implied in a brochure is contractually contradicted in the fine print. If you don't understand what a tour operator's terms mean, consult your travel agent. Better yet, ask your lawyer.

SAFEGUARD YOUR INVESTMENT
Since a tour package may be the largest travel purchase you will ever make, demand a degree of financial security.

Although competing schemes are used by tour operators to promote their financial rectitude, the Travel Adviser believes that two programs stand head and shoulders above all the others: the $1 Million Consumer Protection Plan of the United States Tour Operators Association (USTOA) and the First of America Bank's Travel Funds Protection Plan.

The $1 Million Plan reimburses travelers if a participating tour operator fails. The First of America Bank plan creates an ironclad escrow account: travelers make funds simultaneously payable to both the tour operator and First of America Bank. The bank does not release the funds until after the tour is completed. More than 40 tour operators belong to the USTOA program, and about 70 suppliers are part of the First of America plan. Most tour operators that participate mention them by name in their brochures.

USE YOUR CREDIT CARD
As a further precaution, pay for your tour package with a credit card. That Will add a measure of financial security should a tour operator fold. If a tour operator will not accept a credit card, buy a similar package offered by one that does.

GET THIS INFORMATION
Buying a tour package is a complicated process, so do some homework. Contact the USTOA for a free copy of "The Smart Traveler's Planning Kit," an excellent compendium of basic information. Send $2 to the Council of Better Business Bureaus (Dept. 023, Washington, DC 20042-0023) for Tips on...Travel Packages, a solid primer. And Tour Talk, from Trafalgar Tours (Suite 1300, 11 E. 26th St., New York, NY 10010) is a fine free pamphlet that explains tour language and standards.

This column originally appeared in Travel Holiday magazine.

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