A New Proposal May Make It Easier to Get Cash Refunds From Airlines

If approved, the proposal will change travel for the better

traveling couple looking at an airport kiosk while a blonde American airlines employee uses the kiosk
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Stories about thousands of canceled flights have been a consistent theme throughout summer, and travelers are left chasing airlines for some compensation. Getting a refund from a carrier is usually quite challenging, but a proposal from the U.S. Department of Transportation is set to make things easier for travelers.

High demand and staffing issues have created a nightmare travel scenario worldwide, with some airports asking airlines to stop selling tickets. By June, the situation had gotten so dire that Transportation Secretary Pete Buttigieg met with executives about fixing the issues plaguing air carriers. Buttigieg is now taking steps to expand consumer protections and make refunds the industry standard.

If the proposal becomes a law, passengers can get a full refund from airlines on canceled or severely delayed flights as long as they don't accept alternate transportation. The repayments must be prompt and offered to people if a carrier: cancels the flight, changes the departure or arrival airport, adds a connection, or if departure/arrival time is changed by more than three hours for domestic flights and more than six hours for international flights. Aircraft changes could also cause a refund if the new aircraft lacks necessary amenities such as moveable armrests or wheelchair storage.

While the Office of Aviation Consumer Protection has long felt that airlines refusing to issue refunds on flights canceled or significantly by a carrier is a violation of passenger rights, there hasn't been a lot of pressure put on carriers to change their ways. This new proposal provides an industry-wide definition of the terms "canceled flight" and "significant change of flight itinerary." In practice, airlines will have less room to dodge refund requests.

That doesn't mean that vouchers will disappear, though. Airlines must offer non-expiring vouchers to passengers who can't fly due to "serious communicable diseases."

Since this is a proposal, the document will likely change before approval. Still, approval seems likely, according to Henry Harteveldt, a travel industry expert interviewed by CNBC Select. The document will be reviewed by the Aviation Consumer Protection Advisory Committee on Aug. 22, and if all goes well, easy refunds may be the next big thing in air travel.

Article Sources
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  1. CNBC. "Buttigieg Urges Airline CEOs to Ensure Reliability This Summer After Waves of Disruptions." June 16, 2022.

  2. U.S. Department of Transportation. "Airline Ticket Refunds and Consumer Protections." Aug. 3, 2022.

  3. U.S. Department of Transportation. "Airline Ticket Refunds and Consumer Protections." Aug. 3, 2022.

  4. CNBC Select. "The DOT is proposing new protections for flyers, including cash refunds for canceled flights." Aug. 7, 2022.