Airline Monarch has announced it has successfully renewed its Air Travel Organiser's Licence (ATOL) less than 24 hours before it was due to expire, ensuring its flights can continue operating as normal.

Regulator the Civil Aviation Authority (CAA) granted the renewal after Monarch secured a £165 million investment from its majority shareholder, Greybull Capital. Monarch's ATOL now runs until the end of September 2017.

On 30 September this year, the CAA granted a 12-day extension to Monarch's ATOL to give the airline more time to secure the necessary funding to prove its financial strength.

There had been concern expressed on social media among people who had booked with Monarch over the cancellation of flights if the CAA refused to renew the airline's ATOL, while many passengers were also questioning what their refund rights were in the event of the licence not being renewed.

However, those fears have now been eased after Monarch was able to reassure the regulator that it is financially secure.

Andrew Swaffield, chief executive of the Monarch Group, says: "It is testament to the extensive effort by all parties, over the past weeks and months, that we are able to announce the largest investment in our 48-year history, as well as the renewal of our ATOL licences."

Update Mon 2 Oct 2017: This story was written last year, but if you’re looking for help following Monarch going into administration in October 2017, please see our full Monarch Airlines help guide.

What are my rights if an airline goes bust?

Monarch's refinancing package has allowed it to renew its membership of the ATOL scheme. ATOL protection means that you're guaranteed a refund if a company goes belly up, and you'll be found an alternative flight home if stranded abroad.

Not all flights are ATOL-protected though, so it's important to check. You should be ATOL-protected if you were in the UK when you booked the flight and the flight departs from the UK. (If you book a return and the first leg's ATOL-protected, the flight back will be too.)

If an airline also sells package holidays, ATOL protection will definitely apply – every UK travel company which sells package holidays is required to hold an ATOL. So you'll definitely be covered if the worst were to happen.

Once you've booked a flight or holiday which is ATOL-protected, you'll receive an ATOL certificate by email, or occasionally post. If you don't get a certificate, your booking's not ATOL-protected.

Bear in mind though that while ATOL protection may mean you get a refund for your flight and/or package holiday, it won't cover other elements you may have booked completely separately – for example, if you've booked separate hotels or car hire.

Is my flight or holiday still ATOL-protected if an airline doesn't renew its ATOL after I've booked?

ATOL protection applies so long as the airline had a valid ATOL at the point you booked. So even if the ATOL of the airline you booked with expires before you fly, you'll be covered in the event of a cancellation.

However, if an airline does lose its licence, anyone who booked a package holiday or ATOL-protected flights with it faces the prospect of having their trip cancelled, although they will receive a full refund.

What's the safest way to book flights?

We always suggest paying for a flight on a credit card, as that way you'll often receive extra protection.

That's because when a transaction's for at least £100 (but not more than £30,000) and you pay for it using a credit card, Section 75 of the Consumer Credit Act means the card company's equally liable with the retailer/seller if something goes wrong. (If you book a return flight, the total value must be at least £100 – if you book flights individually, each must be at least £100.) See our Section 75 guide for full help.

Flights costing less than £100 booked on a credit card, or any flights booked with a debit card, may still get some protection via the 'chargeback' scheme – see our Chargeback guide for more.