Flight canceled? Here's what a new rule says the airline must do.


Finally, no more vouchers!

The U.S. Department of Transportation (DOT) has put its John Hancock on a new rule that forces airlines to play nice when someone’s flight is significantly delayed, canceled altogether, and a number of other mishaps that are out of a traveler’s control.

It’s a rule that requires airlines to provide passengers with automatic cash refunds when owed – and to do it promptly. 

“Passengers deserve to get their money back when an airline owes them - without headaches or haggling,” said U.S. Transportation Secretary Pete Buttigieg. “Our new rule sets a new standard to require airlines to promptly provide cash refunds to their passengers.”  

The agency has been persistent in trying to make the airlines understand that the customer comes first. Little by little, DOT has pushed for parity in refund policies and taking away airlines’ preference to call their own shots.

As a result of refund policies differing from airline to airline, it was difficult for passengers to know or assert their refund rights and the DOT’s complaint box was getting stuffed by travelers who felt mistreated by the airlines’ refund rules.

Under the rule, passengers are entitled to…

With the new DOT mandate, any airline passenger will be entitled to a refund for:

Canceled or significantly changed flights: “Passengers will be entitled to a refund if their flight is canceled or significantly changed, and they do not accept alternative transportation or travel credits offered,” the agency said in its announcement.

The key phrase there is “significantly changed.” In the past, that phrase could mean anything, but now it's defined as a flight where the departure or arrival times are more than 3 hours domestically and 6 hours internationally; departures or arrivals from a different airport; increases in the number of connections; situations 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: Now, anyone who files a “mishandled baggage” claim is entitled to a refund of their checked bag fee if the bag 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: There’s an unexpected addition to the DOT’s rule in that any passengers who paid for an extra service – such as seat selection, Wi-Fi, or in-flight entertainment – will be entitled to a refund for that fee if an airline fails to provide this service.

In addition, the DOT is also proposing that airlines be banned from charging an extra fee to sit next to a young child traveling with them, and it also has expressed a desire to improve the rights of passengers who use wheelchairs. 

“This is part of a wave of our national pushback against companies playing games with our money, whether it’s add-in airline fees or hotel junk fees or surprise medical bills," U.S. PIRG Education Fund Consumer Watchdog Teresa Murray said. "This is great for consumers, so we can make informed decisions about how we spend our hard-earned money. 

“Industry players have said it’s impossible to provide complete pricing, that it was too complicated. We’ve never believed that. If they want to sell airline tickets, they must now do it with transparency.”

And, you’ll get it simple and fast, too!

DOT’s final rule also makes it simple and no-nonsense for passengers to receive the money they are owed. With this rule in place, airlines and ticket agents have to issue refunds within seven business days of refunds becoming due for credit card purchases and 20 calendar days for other payment methods.

It’s got to be the full amount, too, including government-imposed or airline-imposed fees and taxes. The only thing that won’t be reimbursed is the value of any portion of a flight that was already used.

No more “We’ll give you a voucher or 20,000 miles,” either. Now, airlines will have to pay in either cash or the original form of payment, such as credit cards or airline miles. “Airlines may not substitute vouchers, travel credits, or other forms of compensation unless the passenger affirmatively chooses to accept alternative compensation,” the agency said.

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