Automatic Refunds for Canceled Flights

Written on 04/26/2024

New Airline Regulations to Boost Passenger Rights

The Biden administration has introduced a set of new regulations aimed at enhancing consumer protections for airline passengers. These changes, which represent the most substantial expansion of passenger rights in the history of the Department of Transportation, are designed to address common issues such as flight cancellations and delays. Here’s what travelers need to know:

  • Automatic Refunds for Disruptions:
    • Passengers will receive automatic refunds for flights that are canceled or significantly delayed. The criteria for significant delays are set at three hours for domestic flights and six hours for international flights.
    • Refunds will include all components of the fare, including airline-imposed fees and government taxes and fees.
  • Transparency in Fee Disclosure:
    • Airlines and ticket agents are required to disclose all fees upfront when advertising fares. This includes fees for checked bags, seat selection, and changes to reservations, ensuring that consumers are not surprised by additional charges after purchasing their tickets.
  • Refund Timelines:
    • Airlines must process refunds within seven days for purchases made by credit card and within 20 calendar days for other payment methods. This aims to simplify the refund process and ensure timely returns for consumers.
  • Coverage of Ancillary Services:
    • If ancillary services such as Wi-Fi or seat selection are paid for but not provided, airlines are required to refund these costs as well. This ensures that passengers are only charged for services they actually receive.
  • Elimination of Surprise Fees:
    • The regulations also target “junk” fees by requiring full disclosure of all potential charges at the first point of airfare advertisement. This prevents the practice of “drip pricing” where additional costs are added during the purchasing process.
  • Guarantees and Consumer Rights:
    • The new rules also clarify that purchasing a ticket guarantees a passenger a seat, even if no extra fee is paid for specific seat selection. Additionally, the rules aim to discourage airlines from advertising misleadingly low prices that do not include mandatory fees.

These regulations, which are expected to save travelers approximately $500 million annually in fees, are scheduled to take effect in October. They are designed to foster greater transparency and fairness in airline pricing, ultimately increasing consumer confidence and satisfaction in airline services.