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Delayed or Canceled Flights: New Rule Provides Passengers with Cash Refunds

Updated: May 2

Airlines are now required to issue automatic refunds when they cancel or significantly change their flights, delay checked bags, or fail to provide extra services passengers purchased.


airport passengers

The Department of Transportation new rule makes it simple and straightforward for consumers to receive money they are owed without having to navigate a patchwork of cumbersome processes to request and receive a refund — searching through airline websites to figure out how someone can make those requests. In addition, passengers would receive a travel credit or voucher by default from some airlines instead of getting their money back, so they could not use their refund to rebook on another airline when their flight was changed or cancelled.


  • New regulations will require airlines to issue refunds for canceled or significantly changed flights, and not accept alternative transportation or travel credits offered. For the first time, the rule defines “significant change.” Significant changes to a flight include departure or arrival times that are more than 3 hours domestically and 6 hours internationally; departures or arrivals from a different airport; increases in the number of connections; instances where passengers are downgraded to a lower class of service; or connections at different airports or flights on different planes that are less accessible or accommodating to a person with a disability.  

  • Significantly delayed baggage return: Passengers who file a mishandled baggage report will be entitled to a refund of their checked bag fee if it is not delivered within 12 hours of their domestic flight arriving at the gate, or 15-30 hours of their international flight arriving at the gate, depending on the length of the flight.  

  • Extra services not provided: Passengers will be entitled to a refund for the fee they paid for an extra service — such as Wi-Fi, seat selection, or inflight entertainment — if an airline fails to provide this service.


airport

DOT final rule says that refunds must also be paid in full, including all government-imposed taxes and airline-imposed fees.


  • Automatic: Airlines must automatically issue refunds without passengers having to explicitly request them or going through other hoops.   

  • Prompt: Airlines and ticket agents must issue refunds within seven business days of refunds becoming due for credit card purchases and 20 calendar days for other payment methods.

  • Cash or original form of payment: Airlines and ticket agents must provide refunds in cash or whatever original payment method the individual used to make the purchase, such as credit card or airline miles. Airlines may not substitute vouchers, travel credits, or other forms of compensation unless the passenger affirmatively chooses to accept alternative compensation.    

  • Full amount: Full refunds of the ticket purchase price, minus the value of any portion of transportation already used. The refunds must include all government-imposed taxes and fees and airline-imposed fees, regardless of whether the taxes or fees are refundable to airlines.


Passengers will be eligible for a refund in cases of:


  • Canceled flight.

  • Domestic flight delay by at least three hours.

  • An international flight is delayed at least six hours.

  • Domestic flight scheduled to depart three hours earlier than the original departure time.

  • International flight scheduled to depart at least six hours earlier than the original departure time.


Customers are eligible for a refund in the following cases if it they no longer wish to further their journey:


  • A change in departure or arrival airport.

  • Increase in the number of connections.

  • Downgrade to a lower class of service.

  • Change in connection at a different airport that is less accessible for persons with a disability, or

  • Change to an aircraft that is less accessible for a person with a disability.


Additionally, in instances where consumers are restricted by a government or advised by a medical professional not to travel to, from, or within the United States due to a serious communicable disease, DOT requires that airlines must provide travel credits or vouchers. Consumers however, may be required to provide documentary evidence to support their request. Travel vouchers or credits provided by airlines must be transferrable and valid for at least five years from the date of issuance.


disabled passengers in wheelchair

The final rule also requires airlines to provide prompt notifications to consumers affected by a cancelled or significantly changed flight of their right to a refund of the ticket and extra service fees, as well as any related policies.


Passengers will also be eligible for a refund of their checked bag fee if their bag is delayed and a mishandled baggage report is filed , provided:


  • That checked bag is not delivered within 12 hours of a domestic flight arrival.

  • Checked bag isn't delivered within 15 hours of an international flight that's 12 hours long or less.

  • The checked bag isn't delivered within 30 hours of an international flight that's more than 12 hours long.


Eligibility for refunds of paid-for extra services that aren't provided by the airline, including:


  • Advance seat selection.

  • Seat upgrades.

  • Transportation of checked or carry-on baggage.

  • Airport lounge access.

  • In-flight entertainment and WiFi.

  • In-flight meals, beverages, and snacks.

  • In-flight blankets and pillows.


In addition to finalizing the rules requiring automatic refunds and protecting against surprise fees, DOT is also pursuing rulemakings that would:


  • Propose to ban family seating junk fees and guarantee that parents can sit with their children for no extra charge when they fly. Last year, no airline committed to guaranteeing fee-free family seating. Now, four airlines guarantee fee-free family seating, and the Department of Transportation is working on its family seating junk fee ban proposal.

 

  • Propose to make passenger compensation and amenities mandatory so that travelers are taken care of when airlines cause flight delays or cancellations. 

  • Expand the rights for passengers who use wheelchairs and ensure that they can travel safely and with dignity.


Be sure to follow Destinations for more and updated rules as they are passed. For more information on the DOT's Automatic Refunds of Airline Tickets and Ancillary Service Fees see it here.

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