NEW RULE Announced for Airline Ticket Refunds - And It's a Game-Changer

The United States government is about to enforce a major change to air travel.

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For years, customers seeking a refund for issues related to air travel would often need to deal with long wait times and reams and paperwork, only to be reimbursed with flight miles or vouchers. However, that’s all about to change.

The Biden-Harris administration has announced, through the Department of Transportation (DOT), a major change to the way the airline industry functions going forward.

Orlando Sanford International Airport

According to the DOT, the new rule “requires airlines to promptly provide passengers with automatic cash refunds when owed.” The agency goes on to say this will “make it easy for passengers to obtain refunds when airlines cancel or significantly change their flights, significantly delay their checked bags, or fail to provide the extra services they purchased.”

Passengers will now be eligible for a refund for the following reasons:

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. 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.

These refunds are required to be automatic, in the form passengers originally paid for their tickets (cash, credit card, etc.), prompt (within 7 days for credit card purchases and 20 days for other payment methods), and in the full amount — minus the value of any previously used travel like a connecting flight — including “all government-imposed taxes and fees and airline-imposed fees, regardless of whether the taxes or fees are refundable to airlines.”

©Department of Transportation

The new rule further requires airlines to provide “prompt notifications” to passengers affected by a canceled or “significantly changed” flight and their right to a refund as well as requiring that airlines must provide “travel credits or vouchers” to consumers who are restricted by the government or advised by a medical professional not to travel “to, from, or within the United States due to a serious communicable disease.”

The new rules are seen as a massive victory for consumers, who have long complained about airline refund rules. According to U.S. Transportation Secretary Pete Buttigieg, “Passengers deserve to get their money back when an airline owes them – without headaches or haggling. Our new rule sets a new standard to require airlines to promptly provide cash refunds to their passengers.”

These new refund rules significantly change how quickly consumers will be able to be refunded for flight changes that are out of their control. Stay tuned to AllEars for more travel news.