Online holiday travel firm On the Beach said it will be hit by "a one-off exceptional cash cost" following the collapse of Monarch Airlines earlier this morning.
The firm, one of Britain's largest retailers of beach holidays, said it has "scheduled airline failure insurance" in place to cover the failure of Monarch.
The insurance covers money held by Monarch and the cost of repatriating customers currently stranded in resorts.
Shares in the firm fell almost two per cent in early trading.
On the Beach said its only exposure related to Monarch's scheduled flights rather than its holidays.
In a short statement, the firm said: "On the Beach is contacting customers that are currently in resort to assist with their return travel and also those customers booked to fly with Monarch Airlines in the coming weeks and months."
The government is working with the Civil Aviation Authority (CAA) to put on planes to get around 110,00 Monarch customers stranded abroad back to the UK.