Under new federal rules, airlines must now provide full cash refunds for issues like canceled flights and significant baggage delays. Here’s what it means for you.
In May, the U.S. Department of Transportation enacted new rules broadening the circumstances in which airline customers are eligible for refunds.
And this week Transportation Secretary Pete Buttigieg sent letters to the CEOs of the largest airlines, reminding them that they have until the fall to comply.
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Two new sets of Department of Transportation rules are now in effect.
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Airlines must provide full cash refunds for issues like canceled flights and significant baggage delays.
This means if you choose not to take the delayed flight, you can get a full refund.
“You have a choice,” says Kevin Brasler, executive editor of the nonprofit Consumers’ Checkbook. “You can just go ahead and take what they're offering to you and you won't get a refund. Or you can say, no, I’m not going to do this. I'll go and take a refund and either cancel my trip altogether or try to book through a different airline.”
According to the Department of Transportation, any cancellation or significant change in a flight is eligible for a refund regardless of the reason for it. This includes weather-related cancellations.
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The department says "significant changes to a flight include departure or arrival times that are more than three hours domestically and six hours internationally; departures or arrivals from a different airport; increases in the number of connections" and more.
When it comes to your luggage, the Department of Transportation says “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."
“If you're entitled to a refund, the airline has to automatically give you your money back, and that's different from before. Up until now, most airlines, instead of giving you your refund, they give you flight credits, and then they made you jump through hoops in order to actually capture the refund you're owed,” says Brasler. "I think the other important thing here to realize is that a big problem with all these trip credits that airlines were issuing instead of refunds. Those things expire, so a lot of people that had their trips canceled, they were issued a trip, you know, credit … and then after a year, they didn't use it, so they lost the money."
According to Department of Transportation, airlines must clearly and proactively inform passengers of their right to a refund whenever their flight is canceled or significantly changed, cash refunds must be automatic for passengers when they are owed, and if passengers opt for vouchers or credits after a canceled or changed flight, they must be valid for at least five years.
In his letter to the airline CEOs Buttigieg said the Department of Transportation recently received a request for the airline industry for additional time to comply with the new rules. He told them the department has found no basis for adjusting the compliance dates, most of which fall in October.
You can read the letter in its entirety here.
