As you prepare to travel through the holiday season and beyond, I want to be sure you know about a new Department of Transportation (DOT) rule that went into effect this week on October 28th, specifically to airline refund policies.
First, here is a brief summary of the key points from the DOT rule.
When Refunds are Required:
- Flight Cancellations: If an airline cancels a flight, you are entitled to a refund if you choose not to travel.
- Significant Schedule Changes or Delays: Refunds are available if there’s a significant delay or schedule change.
- Failure to Provide Pre-paid services: Fees for services like baggage, seat upgrades, or Wi-Fi may be refunded if they were unusable due to cancellations or delays.
- Class Downgrade: If you are downgraded to a lower class than booked (e.g., first class to economy), you’re entitled to the difference in fare.
- Lost Baggage Fees: If baggage is declared lost, airlines must refund baggage fees.
What is a significant change or delay?
- The DOT has defined a significant delay as more than 3 hours for domestic flights and more than 6 hours for international flights.
- Examples of significant changes can be departures or arrivals from a different airport or even increases in the number of connections.
When are refunds expected to be issued?Airlines must process refunds within 7 business days for credit card payments and 20 days for cash or check payments. A few important notes and exceptions:
- This rule is effective for flights purchased on or after October 28, 2024. Previously purchased flights are not impacted by this rule.
- Airlines are not required to offer refunds for incidental expenses incurred, such as hotel or rental car, due to a significant delay or change.
- Airlines are not required to offer a refund to travelers who purchase non-refundable tickets but do not travel for personal reasons like illness or late arrival to the airport.
Takeaways:I am pleased that there is now a clear definition of “significant delay” for airlines. The other big takeaway is that the airlines must now process necessary refunds promptly. You should not have to chase down eligible refunds anymore. Each airline may implement its own policies in accordance with the new rule, so it is always best to check with your specific airline for the most current terms & conditions. I also still strongly urge you to consider travel insurance for each vacation. That peace-of-mind policy is there for the unexpected like illness. Are you pleased with this new ruling that is very consumer-friendly? Drop a comment below with your specific questions about the policy.
