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Proposed Airline Refund Rule Will Make It Easier for Passengers to Get Their Money Back

The Department of Transportation has proposed new rules to make it easier for travelers to get refunds on canceled or delayed flights, per CBS news.

The department released the proposed rule in a statement Wednesday and said “if adopted, would significantly strengthen protections for consumers seeking refunds for airline tickets.”

The rules are open for a 90-day comment period ending November 1.

Airline analyst Samuel Engel, senior vice president of Aviation ICF, predicted the airlines would not go quietly into the new rules.

“I’m sure there will be vigorous comment,” he told Entrepreneur.

“The airlines don’t like to be told how to manage their customers,” he added.

Consumers — and airlines — have been buffeted by difficult winds this summer.

Entrepreneur’s Emily Rella detailed a 14-hour-plus day at New York’s LaGuardia airport in late June, where she was one of about 1,000 cancellations that day due to weather and staffing issues.

Another couple got stuck in Mexico in late July and ran out of heart medication, Insider reported.

Prior to this, the DOT rule was that carriers had to refund customers if they canceled their flights, but it was frequently downplayed or ignored, CBS News reported.

The DOT said since 2020 it has gotten a “flood” of complaints from travelers who couldn’t get ticket refunds after delays, cancellations, or pandemic-related issues. It added that prior rules for when passengers could get refunds from carriers were less clear.

The new proposed rules are as follows. Customers can get a refund if their travel is “significantly” changed or canceled, which means:

  • A domestic flight departure or arrival was shifted by three hours or more
  • An international departure or arrival shifted by six hours or more
  • When the number of connections increases
  • If the departure or arrival location is changed
  • If the type of plane the consumer gets on is changed and “it causes a significant downgrade in the air travel experience or amenities available onboard the flight.”

In addition, if people can’t travel because of, say, a pandemic shutting down a border, a carrier would be required to give customers an indefinite voucher.

Going even further, “airlines and ticket agents that receive significant government assistance related to a pandemic would be required to issue refunds, in lieu of non-expiring travel credits or vouchers,” the department said.

Delta and United declined to comment on the proposed rules to Entrepreneur and referred to the Airlines for America industry group, which did not respond to a request for comment.

“We received the DOT rulemaking on Wednesday and our Teams are in the process of reviewing the proposed rules,” Southwest said in an emailed statement to Entrepreneur. It also referred to its announcement last week that the airline would remove expiration dates on flight credits.

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