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Here’s what you need to know about the new airline refund rules

As of Oct. 28, US travelers have a legal right to compensation from airlines for canceled or seriously delayed flights, according to three new rules from the US Department of Transportation.

The new rules were developed under the Biden administration and announced in April but are now fully in effect. Specifically, the final rules require airlines to automatically refund passengers if:

  • Their flights are canceled or drastically changed
  • Bag loading is very delayed
  • Airlines do not offer additional services as purchased

However, remember: The rules do not apply to travelers who accept an airline’s offer to rebook on a later flight when their original trip is canceled or significantly delayed. They also do not include compensation for delays and cancellations under the airline’s control, although this law is proposed.

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What qualifies as a significant change?

The DOT considers the following to be “significant changes:”

  • The departure or arrival of domestic flights is delayed by three hours or more
  • International flight departures or arrivals are delayed by six hours or more
  • The journey is extended by six hours and more
  • The traveler’s origin or destination is changed
  • Situations where the traveler ends up having more connections
  • If a guest is demoted to a lower level of service
  • If a disabled traveler is forced to depart at one or more connecting airports different from the original itinerary.
  • When a disabled traveler must fly on a flight that is less accessible or less accommodating than originally scheduled

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Additionally, travelers will be eligible for a checked bag refund if their luggage is not delivered within 12 hours of a domestic flight arriving at their gate or within 15 to 30 hours of international arrivals. In order to receive compensation for seriously delayed baggage, passengers will need to file a mishandled baggage report with the airline at the airport upon arrival.

Passengers are now entitled to a refund for disrupted flight services, such as Wi-Fi, seat selection or entertainment.

How soon should you get a refund after the flight?

According to the DOT, refunds must be issued to the original payment method within seven business days for credit card purchases and 20 days for all other payment methods. Airlines must also inform affected travelers of their right to a refund of ticket costs and any additional service charges.

Airlines cannot offer vouchers, credits or other forms of compensation in lieu of the original payment method unless the passenger chooses to accept these alternatives.

Finally, in cases where a customer is unable to travel to, from or within the US due to a communicable disease, the new law requires airlines to provide a travel credit or voucher valid for at least five years. Passengers may be required to show documentation to support their claim.

Bottom line

In theory, these new rules should remove the “hoops” travelers have to jump through to claim compensation for canceled or delayed flights – but it remains to be seen how smoothly airlines will implement them.

“We support the automatic refund rule and are happy to accept refunds for customers if they choose not to rebook,” said a spokeswoman for Airlines for America, an advocacy group that represents North America’s largest airlines.

In addition, airlines have until April 2025 to reflect associated charges up front, such as additional fees for checked bags, full-size carry-on bags and change and cancellation fees.

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