Over the past 15 years, 27 airlines have filed for bankruptcy, including the recent case of Silver Airways in December 2024. For passengers, these events can lead to confusion, frustration, and financial loss—especially when flights are canceled with little warning and refunds are hard to come by.
What Happens When an Airline Goes Bankrupt?
According to AirAdvisor’s legal team, airline bankruptcy doesn’t always mean operations will stop immediately. Some carriers file for reorganization (like Chapter 11 in the U.S.), allowing them to continue flying while restructuring. Others shut down entirely (such as under Chapter 7 liquidation), canceling all flights and laying off staff.
Understanding the type of bankruptcy is the first step in…
