Potential Norwegian Cruise Line Bankruptcy: What should a traveller do?

[time391]

Hello fellow cruisers,

 

I was originally slated for a trip on May 9th from Barcelona, Spain in the Mediterranean and it was cancelled due to COVID-19 issues, so I received the cruise credit.

 

Today, I read some financial news coming out of potential bankruptcy:

https://www.miamiherald.com/news/business/tourism-cruises/article242506646.html

 

https://www.forbes.com/sites/sergeiklebnikov/2020/05/05/norwegian-cruise-line-stock-plunges-20-after-company-warns-of-possible-bankruptcy/#2f3883f3481e

 

https://www.ibtimes.com/norwegian-cruises-warns-bankruptcy-filing-will-cruise-line-survive-2970731

 

What should cruisers do? Will we need to go to court and be claimants in a bankruptcy filing?

 

I don't know if a cruise line has ever filed for bankruptcy in my memory, so I want to ask other members. They haven't filed yet, but a preliminary SEC warning is very bad from a finance standpoint. My background is in Financial Accounting and based on experience, when I company declares there's doubt of a going concern, it's a red flare.

Edited May 6, 2020 by time391

[Searanger]

A little shocked to see Norwegian talking openly about bankruptcy.  Basically a way of reorganising debt and still operating.  If you have nothing in writing about accepting a F.C.C. (which I'm sure you don't) I would just file a dispute with your credit card immediately.  For sure, those future cruise credits will be worthless.  

[time391]

2 minutes ago, Searanger said:

A little shocked to see Norwegian talking openly about bankruptcy.  Basically a way of reorganising debt and still operating.  If you have nothing in writing about accepting a F.C.C. (which I'm sure you don't) I would just file a dispute with your credit card immediately.  For sure, those future cruise credits will be worthless.  

 

Problem is I paid for the cruise back in November 2019 with my Bank of America NCL Credit Card, so I am kind of stuck right now as it exceeds the transaction dates to challenge.

[seaman11]

17 minutes ago, time391 said:

 

Problem is I paid for the cruise back in November 2019 with my Bank of America NCL Credit Card, so I am kind of stuck right now as it exceeds the transaction dates to challenge.

i wouldnt worry just yet , i heard they got 1 new investor for almost 400mill . 

[tallnthensome]

This has already been discussed extensively in countless threads from this news today . 

[cruiser4801]

Do worry.  NCL IS going bankrupt.  

 

They have no money.

 

They will never regain their former passengers' trust.  NCL will never regain mine.

 

For those who are owed a refund, you should dispute the credit card charge for services noir rendered and good not delivered.  It is our only hope of getting our money back.

 

 

[Monstica]

Worried because I paid for my travel insurance 30 days after first deposit.  It says in black and white that after 30 days it Won’t cover bankruptcy so I’m screwed.  I wonder if i should cancel this evening. I am booked on a Mediterranean cruise in August.  I figured the ship probably wouldn’t sail and I was waiting for NCL to cancel and go August 2021 instead.   Does anybody have any sound advice?

 

[All-ready2cruise]

2 minutes ago, Monstica said:

Worried because I paid for my travel insurance 30 days after first deposit.  It says in black and white that after 30 days it Won’t cover bankruptcy so I’m screwed.  I wonder if i should cancel this evening. I am booked on a Mediterranean cruise in August.  I figured the ship probably wouldn’t sail and I was waiting for NCL to cancel and go August 2021 instead.   Does anybody have any sound advice?

 

It's difficult times for everyone right now. I hope you're doing OK and sheltering in place for now.  The main question is, "have you made final payment yet". IMO, at this point, I'd wait it out since it won't really make any difference. If you're after final payment, you'll have a choice: cancel yourself and recieve an FCC for 100% of full cruise value or wait for NCL to cancel and receive 125% of the cruise value.  If they go bankrupt it may not matter very much. 

 

I think most loyal NCL customers are hoping that it makes it through this horrid virus pandemic and will be able to cruise again in the near future. 

 

I wish you luck. Stay strong. 

[surfone]

Well,  I am upset but I made the decision to cancel our b2b scheduled this  September prior to the final payment date. I forgot to ask the agent about the travel insurance protection ($35 pp) we purchased  from NCL at the time of booking,  do we get that refunded along with our deposit?  For one of those weeks we used a Cruise next certificate which I realize will go back to the account for future  booking (that is if there is a NCL in existence) 

[All-ready2cruise]

5 minutes ago, surfone said:

Well,  I am upset but I made the decision to cancel our b2b scheduled this  September prior to the final payment date. I forgot to ask the agent about the travel insurance protection ($35 pp) we purchased  from NCL at the time of booking,  do we get that refunded along with our deposit?  For one of those weeks we used a Cruise next certificate which I realize will go back to the account for future  booking (that is if there is a NCL in existence) 

Yeah, I cancelled my Dec. TA cruise on the GA which I was really looking forward to as well.  

I had taken insurance as well and did, after a bit of time, rec'd the money back to my CC.   

I hope you receive your refund as well. 

[surfone]

1 minute ago, All-ready2cruise said:

Yeah, I cancelled my Dec. TA cruise on the GA which I was really looking forward to as well.  

I had taken insurance as well and did, after a bit of time, rec'd the money back to my CC.   

I hope you receive your refund as well. 

I'm glad you received your refund.  We became platinum earlier this year.  I do hope they somehow pull out of this and recover. I think of all those beautiful ships out there and several that were just built.  Very sad

[bonvoyagie]

I have never been charged for insurance on the deposit side - I have signed up for it but it does not come out until final payment.

[wvacations]

6 hours ago, time391 said:

 

Problem is I paid for the cruise back in November 2019 with my Bank of America NCL Credit Card, so I am kind of stuck right now as it exceeds the transaction dates to challenge.

 

I just disputed my $5,400 cruise on 3/14/20  that was cancelled on 3/13/20. Not sure about other credit cards, but BOA NCL card gives you 60 days from when you were made aware that NCL was cancelling your cruise. 

 

Hope you are able to get your money back.

[SNJCruisers]

So, anybody hear anything about how this might cancel or delay the Leonardo Class ships?

[boatseller]

I came here just to yawn.  Scary language in SEC filings is pretty routine and mostly to ward off shareholder lawsuits.  It could also be a tactic to put off any potential takeovers with the share price so low.

[*Luv2Cruz*]

 
I just disputed my $5,400 cruise on 3/14/20  that was cancelled on 3/13/20. Not sure about other credit cards, but BOA NCL card gives you 60 days from when you were made aware that NCL was cancelling your cruise. 
 
Hope you are able to get your money back.

Thinking of doing the same with the same card and have a few questions.

What is the process to dispute, what was the reason you stated for the dispute, and how long should it take to receive your money back? TIA

Sent from my SM-T350 using Tapatalk

[SouthLyonCruiser]

11 hours ago, surfone said:

Well,  I am upset but I made the decision to cancel our b2b scheduled this  September prior to the final payment date. I forgot to ask the agent about the travel insurance protection ($35 pp) we purchased  from NCL at the time of booking,  do we get that refunded along with our deposit?  For one of those weeks we used a Cruise next certificate which I realize will go back to the account for future  booking (that is if there is a NCL in existence) 

If all you will be out is the $35 and your deposit consider yourself lucky. We have over $5000 paid on a July Alaska cruise and I am now scrabbling to see what my best options are. We do have independent cruise insurance and there is a lot of fine point wiggling on the $100,000 cancellation coverage and I am not sure if a claim can be made to Visa for services not rendered.

[iamtrustworthy]

12 hours ago, Monstica said:

Worried because I paid for my travel insurance 30 days after first deposit.  It says in black and white that after 30 days it Won’t cover bankruptcy so I’m screwed.  I wonder if i should cancel this evening. I am booked on a Mediterranean cruise in August.  I figured the ship probably wouldn’t sail and I was waiting for NCL to cancel and go August 2021 instead.   Does anybody have any sound advice?

 

Hi Monstica,

 

Which policy do you have?

 

A typical plan that includes Financial Default gives a period of time, like up to 2 weeks, where the supplier cannot go into Financial Default.

 

Travel Insurance typically covers 3rd party Financial Default. All the policies I know do not cover you are not covered for Supplier Financial Default if you booked directly with the Travel Supplier. Financial Default usually means the Travel Supplier ceases operation.

Plans you get from the Travel Supplier probably don't cover you.

If you are unsure, ask whoever sold you the policy if you are covered.

I hope this makes sense.

Steve Dasseos

 

[spanishguy1970]

6 hours ago, SNJCruisers said:

So, anybody hear anything about how this might cancel or delay the Leonardo Class ships?

if they don't have any money to pay refunds i doubt very much they will have money for new ships.

[Monstica]

Steve Dasseos - I have WorldWide Trip Protector Insurance CF Travel Insured International through USAA.  I have paid close to $20,000 for this cruise and I am so worried.  I have been on hold 3 hours trying to get through and I know it does cover bankruptcy but I waited too long to get the insurance, it states I needed to get it 30 days from first deposit.  If the company does file for bankruptcy I guess I will lose all my money. 

[lanceholt]

Norwegian Cruise Line Holdings today announced it successfully secured over $2 billion of additional liquidity in response to impacts of the COVID-19 global pandemic on the company.

The company announced last week it expected a cash burn of $100 to $150 million per month with most of its fleet in cold lay up, giving the company over a year of cash on hand for a worst-case zero-revenue scenario. 

Yesterday, the company announced the launch of a series of capital markets transactions, led by Goldman Sachs, to raise approximately $2 billion. The transaction has since been upsized to gross proceeds of $2.225 billion ($2.4 billion if the underwriters exercise their full overallotment options) due to significant oversubscription and demand across all three offerings.

The transactions consisted of (1) $400 million public offering of common equity, (2) $750 million exchangeable senior notes offering, (3) $675 million senior secured notes offering and (4) $400 million private investment from global consumer-focused private equity firm L Catterton.

In addition, a number of cost cutting measures range from layoffs to deferred loan payments on company ships.

Contingent on completion of the transactions, the company expects to have approximately $3.5 billion of liquidity.

This significantly strengthens the company’s financial position and liquidity runway and it now expects to be positioned to withstand well over 12 months of voyage suspensions in a potential downside scenario, according to a press release.

 

 

[FranknBeans]

Because we are from Canada we have no travel protection  in  the US as we have in Canada. Thus we decided to cancel our South America cruise booked for 3/2021.

Just can't afford to take the risk of losing a couple $2k. 

So we a just going to sit back and watch what happens. I do know that if NCL goes bankrupt we will not sail any of the other lines.

[Waquoit]

17 hours ago, time391 said:

 

Problem is I paid for the cruise back in November 2019 with my Bank of America NCL Credit Card, so I am kind of stuck right now as it exceeds the transaction dates to challenge.

I'm pretty sure the clock doesn't start ticking until you get the cancellation notice. That's how it worked for me. It's worth a call.

[Sand and Seas]

12 hours ago, SNJCruisers said:

So, anybody hear anything about how this might cancel or delay the Leonardo Class ships?

Cruise Critic has addressed how the shipyard shutdowns is delaying ships for many companies, including Norwegian's Leonardo class:   

 

[SNJCruisers]

3 hours ago, FranknBeans said:

I do know that if NCL goes bankrupt we will not sail any of the other lines.

Since it was announced today that NCL has obtained 2 billion in additional liquidity to cover them for the next year with no income stream, it looks like they will be safe along with RCI and Carnival.

But, why would you give up cruising if NCL went bankrupt?  There are a half dozen other comparable main stream cruise lines that offer a great product.