Home » New Airline Refund Rules: What Group Planners Need to Know

New Airline Refund Rules: What Group Planners Need to Know

The airline industry has recently seen significant changes in refund policies, thanks to the new airline refund rules introduced by the Department of Transportation (DOT).

Understanding these new airline refund rules is essential for group planners. Let’s dive into the details of these new regulations and explore their impact on group travel planning.

Why are there New Airline Refund Rules?

The Department of Transportation recently introduced new airline refund rules designed to better protect passengers.

These rules require airlines to promptly provide automatic cash refunds to passengers in specific situations.

The regulation also protects passengers from surprise fees for baggage, change, and cancellations.

By implementing these regulations, the DOT will simplify the refund process, save consumers money, and promote fairer and more transparent practices in the airline industry.

new airline refund rules

Why Do Group Travel Planners Need to Understand the Changes?

In addition to individual travelers, group travel planners need to get up to speed with the changes to provide accurate information and assistance to their customers.

Failing to understand and comply with the new rules can lead to financial losses for both passengers and travel planners.

The Highlights….

Here’s what you need to know about the new regulations:

1. Cash Refunds

If an airline cancels or significantly delays a flight, they are required to provide an automatic cash refund within 7 days (without the customer having to fight for it!)

No more defaulting to credits or vouchers unless that’s what the customer chooses.

2. No Surprise Fees

Charges that the consumer may not be expecting (checked bag and carry-on fees, cancellation fees, etc.) will be transparent at the time of booking.

Well-informed passengers can be confident that they are making the best choice.

3. Tougher Airline Penalties

Stricter enforcement and tougher penalties will be levied against airlines that cancel or delay. This is in response to the 2022 Southwest Airlines holiday meltdown (which has since been subject to an historic $140 million enforcement action.)

These highlights showcase the DOT’s commitment to ensuring consumer protection and improving the overall travel experience for air passengers.

new rules for airline refunds

Differences in Refund Policies for Group vs. Individual

When it comes to refund policies, there are differences between group bookings and individual bookings. Group bookings typically involve multiple passengers traveling together under a single reservation.

Under the new refund rules, airlines are required to provide automatic cash refunds to individual passengers when owed. However, the process for group bookings may be slightly different.

In the case of group bookings, the refund process may involve additional coordination between the airline and the ticket agent handling the group reservation.

What Qualifies for a Refund?

To qualify for automatic refunds, there must be a ‘significant schedule change.’ The U.S. Department of Transportation (DOT) defines a ‘significant change’ as a flight departure or arrival time that is delayed by more than three hours (domestic) or six hours (international.)

Other examples of a significant change include:

Changes to your airport of departure or arrival
Increase in the number of connections
Downgrade to a lower class of service than purchased
Less accessible flights for disabled passengers

new rules for airline refunds

In addition, passengers who file a mishandled baggage report are now entitled to a refund for any checked bag fees.

These refunds apply if their bags are not delivered within 12 hours of their domestic flight’s gate arrival or 15-30 hours for an international flight gate arrival (depending on flight length.)

When Will Refunds Be Issued?

Refunds must be issued promptly within seven business days for credit card payments and 20 calendar days for other methods. They’ll cover the full ticket amount less any portion that is used.

Refunds will be issued in cash or in the original form of payment, such as credit card or airline miles, giving passengers greater flexibility.

Where Can I Find Airline Specific Information?

A new website accompanies the new airline regulations. Passengers who need help understanding each airline’s commitment can go to the Airline Customer Service Dashboard.

Here they’ll find easy-to-read information on exactly what each airline has committed to providing if they cause the delay or cancellation.

When Do the New Rules Take Effect?

The new rules for refunds will begin October 28, 2024.

Tips for Group Travel Planners

Take a few proactive steps to be sure that you and your clients are covered under the new regulations:

1. Purchase tickets directly from airline websites or secure websites authorized by airlines.

Carefully review the airline’s refund policy and keep records of the ticket purchase process, including confirmation emails and receipts.

2. Become familiar with your airline’s customer care plans.

Be sure you understand its commitments to passengers, refund policies, and alternate solutions for flight disruptions.

3. Explore travel credit options.

While airlines will be required to provide cash refunds in the event of a significant delay or cancellation, they may also offer travel credits or vouchers as an option.

Group planners need to know the terms and conditions of these credits (expiration dates, transferability, etc.) and assess whether they are suitable for their groups’ future travel needs.

new rules for airline refunds

4. Create a contingency plan.

If your group’s flight is cancelled, contact the airline’s customer service for information on alternative flights, rebooking options, and compensation.

5. Educate yourself.

Bookmark the passenger rights page on the Department of Transportation’s website for quick reference!

6. Update your trip planning tech.

Passenger information, reservation details important documents, etc. should be easily accessible to simplify the refund process. Paper files and excel sheets may not cut it anymore!

Consider updating to a cloud-based travel planning software like Group Travel Odyssey that includes online registration and payment platforms to make your operations easier and more efficient.