Airlines to Issue Cash Refunds for Delays and Cancellations

Cancelled or Delayed Flight Reimbursement Required in Cash

The Biden administration announced final rules on Wednesday requiring airlines to automatically issue cash refunds for delayed and cancelled flights. The rules also mandate better disclosure of fees related to baggage, reservation changes, and other services.

The U.S. Department of Transportation (DOT) announced that airlines will now be obligated to provide automatic cash refunds within a few days for both canceled flights and delays deemed "significant." This includes domestic flight delays over three hours and international flight delays over six hours.

This new flight delay reimbursement regulation eliminates the previous discretion airlines had in determining the length of a delay that would be required for a refund.

So whether you have a flight cancelled due to weather or delayed because of maintenance, passengers now have better options for a solution.

Baggage Fees Included in the Regulations

While airlines can still offer alternative options like rebooking or travel credits, passengers have the right to reject such offers to get a cash refund.

This rule doesn't just apply to refunds but also for checked-bag fees if luggage is not delivered within 12 hours for domestic flights or between 15 to 30 hours for international flights. Fees for services such as seat selection or in-flight internet will also be refundable if the service is not provided.

The DOT's action comes in response to a significant rise in complaints about refunds during the COVID-19 pandemic. Many travelers found themselves dealing with canceled flights and concerns over safety while sharing small, confined spaces with other passengers.

Airlines for America, a trade group representing major U.S. carriers, acknowledged the decline in refund complaints since mid-2020.

According to the group's spokesperson, airlines have proactively offered a variety of options, including fully refundable fares, to accommodate customers' needs. The trade group reported that the 11 largest U.S. airlines refunded a total of $43 billion to customers between 2020 and 2023.

Transparency in Fee Disclosures

In addition to the refund rules, the DOT issued another regulation requiring airlines and ticket agents to be transparent about fees for checked and carry-on bags, as well as fees for canceling or changing reservations. Airlines are now required to display these fees prominently on their websites, alongside ticket prices and schedules.

The rule also mandates that airlines inform passengers of their right to a guaranteed seat without extra charges, although airlines are still permitted to charge for seat selection. Many carriers currently charge additional fees for preferred seating options, such as exit-row or front-cabin seats.

They estimate that these measures will result in annual savings of over $500 million for passengers. Airlines for America emphasized that its members prioritize transparency and offer a wide range of choices as soon as they start their flight search.

Implementation and Enforcement

The new rules are set to be implemented over the next two years and represent a significant step in the Biden administration's broader efforts to combat what President Joe Biden has referred to as "junk fees" in the airline industry.

Last week, Transportation Secretary Pete Buttigieg announced that state officials from 15 states will assist in enforcing federal airline consumer protection laws.

In summary, these new regulations mark a significant victory for airline passengers, ensuring that they are better protected and informed when navigating the complexities of air travel.

As the industry adapts to these changes, travelers can expect greater transparency, more flexibility, and improved consumer rights in their dealings with airlines.

What to Do if Your Flight is Cancelled

When youre booking a flight, the last thing you want to worry about is "what do I do if my flight is cancelled", but it's unfortuantely a reality we have to get used to.

Here are some tips for what to do if your flight is cancelled:

• Contact the Airline Immediately: Find out your options for rebooking or getting a refund. The airline should be able to help you find an alternative flight.
• Explore Rebooking Options: See if the airline can put you on another flight to your destination. They may offer you different routing options or flights on different days.
• Stay Informed: Keep an eye on your email and phone for updates from the airline about your cancelled flight and any rebooking options.