New Airline Automatic Refund Rule Takes Effect: What Travelers Need to Know

Yesterday, Secretary of Transportation Pete Buttigieg announced that the automatic refund rule for airlines had gone into full effect, just in time for the holiday travel rush. 

In an announcement on Threads, Secretary Buttigieg stated that “passengers deserve to get their money back when an airline owes them-without headaches or haggling.” 

Automatic Refunds for Flight Cancelations and Significant Delays

The new rule means that if a flight is canceled or significantly changed and the passenger does not accept the changed flight, a rebooking, or alternative compensation, the passenger will automatically get a refund without having to request one or go through hoops to try to get one. Please note that “significant delay” has not been defined by the DOT; it is up to the airline to discern what constitutes a significant delay, and it may change from case to case. 

Class of Service Change Refund

Occasionally, the aircraft needs to be changed, and sometimes, you may be downgraded from first or business class to economy. If that happens, you are now entitled to an automatic refund in the amount of the difference in the ticket price. 

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Optional Service Fee Refund

If you prepaid for an optional service on board, such as WiFi, inflight entertainment, or seat selection, and your flight is canceled or the airline does not provide the service (sometimes the WiFi is out), you are entitled to a refund. Please note that you may need to notify the airline that the service is not working. 

Significantly Delayed Baggage Return Refund

Passengers who file a mishandled baggage refund are entitled to a refund of their checked baggage fee if the bags are missing twelve hours after a domestic flight’s arrival or fifteen or thirty hours after an international flight’s arrival at the gate, depending on the length of the flight. 

Exceptions to the Automatic Refund

As with everything, there are exceptions to this rule. Situations not included are:

1. You purchased a non-refundable ticket. (there are exceptions to this, as airlines may decide to refund you even if you have a non-refundable ticket). 
2. You cancel a trip due to a personal issue. 
3. You are unhappy with your experience with the airline. 
4. Incidental expenses, such as hotel rooms, rental cars, and meals, are accrued because the flight was canceled or delayed. 

How To Get A Refund For Your Canceled Flight

If you believe you are entitled to a refund, contact the airline in writing about your refund and the situation surrounding the request (canceled flight, significant delay, etc.). You should receive a refund within a reasonable amount of time—within seven days for flights booked with a credit card and within twenty days for flights booked using cash or check. If the airline refuses your refund request, you should file a complaint with the DOT.