Airlines are now required to provide passengers with prompt automatic refunds when their flights are delayed or canceled, as per a new rule from the Department of Transportation announced on Wednesday. The regulations, to be implemented over the next six to 12 months, also ensure automatic refunds for delays to checked bags and failure to provide paid-for extra services.
Passengers are entitled to a refund if their flight is canceled or significantly changed and they decline alternative transportation or travel credits offered. This includes domestic flights delayed by over three hours and international flights delayed by more than six hours.
Significant changes that make passengers eligible for a refund include alterations in the departure or arrival airport, an increase in connections, or being downgraded to a lower traveling class. Refunds are also applicable if passengers are switched to connections at different airports or flights on less accessible planes for individuals with disabilities.
Previously, airlines determined their own refund policies, leading to confusion for passengers. Some airlines defaulted to providing travel credits or vouchers, making it challenging for passengers to obtain refunds without a cumbersome request process.
Passengers are also entitled to a refund of their checked bag fee if their bag is delayed and a mishandled baggage report is filed. The policy covers bags not delivered within 12 hours of a domestic flight's arrival at the gate, or 15 to 30 hours for international flights, depending on the flight's duration.
If passengers pay extra for services like WiFi, seat selection, or in-flight entertainment and do not receive them, they are entitled to a refund for the fee paid.
The Department of Transportation emphasized that the new rule streamlines the refund process for passengers affected by flight cancellations, significant flight changes, delayed checked bags, or missing extra services. Refunds must be prompt, within seven business days for credit card purchases and 20 calendar days for other payment methods, in the original payment form used by the passenger.
Furthermore, airlines must provide a full refund, including all government-imposed taxes and fees, as well as airline-imposed fees. The DOT received over 102,000 complaints from airline customers in 2020, with nearly 90,000 related to refunds, highlighting the challenges faced by passengers in obtaining compensation for flight disruptions and lost luggage.
Travel disruptions surged in the summer of 2022 as travelers resumed flying after pandemic-related cancellations in the previous years. This year's summer travel is also anticipated to face significant disruptions, with Boeing delaying certain plane deliveries.
