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Airlines must offer full refunds, instead of vouchers, for coronavirus flight cancellations

Airlines must offer full refunds, instead of vouchers, for coronavirus flight cancellations
(Image credit: United)

Airlines have been reminded by the Department of Transportation (DOT) that they are obliged to refund passengers if their scheduled flights are cancelled or significantly delayed because of the coronavirus pandemic, rather than issue them with vouchers.

The DOT has warned that it is monitoring airlines’ refund policies and practices, and will take enforcement action if necessary, after receiving an increasing number of complaints and inquiries from passengers - including many with non-refundable tickets - who had been denied refunds for cancelled or delayed flights. Anyone struggling with finances, and currently applying for the coronavirus stimulus package (opens in new tab), will be relieved to hear this.

In many cases, the DOT said passengers had been told they would instead receive vouchers or credits for future travel. However, with airlines significantly scaling back their schedules in the wake of the COVID-19 public health emergency, this means passengers are likely to be left with vouchers and credits that they are not readily able to use.  

Airlines have long provided such refunds, including during periods when air travel has been disrupted on a large scale, such as the aftermath of the September 11, 2001 attacks, Hurricane Katrina, and presidentially declared natural disasters. Although the COVID-19 public health emergency has had an unprecedented impact on air travel, the airlines’ obligation to refund passengers for cancelled or significantly delayed flights remains unchanged.

“Carriers have a longstanding obligation to provide a prompt refund to a ticketed passenger when the carrier cancels the passenger’s flight or makes a significant change in the flight schedule and the passenger chooses not to accept the alternative offered by the carrier,” said Blane A. Workie, Assistant General Counsel for Aviation Enforcement and Proceedings at the DOT.

“The longstanding obligation of carriers to provide refunds for flights that carriers cancel or significantly delay does not cease when the flight disruptions are outside of the carrier’s control (e.g., a result of government restrictions). The focus is not on whether the flight disruptions are within or outside the carrier’s control, but rather on the fact that the cancellation is through no fault of the passenger.”

Acknowledging the significant impact that the coronavirus has had on the airline industry, the DOT said carriers will be given an opportunity to become compliant before any action is taken against them.

What does this mean for affected travellers?

In a nutshell, the announcement means that if your flight is cancelled or significantly delayed due to the coronavirus, then you are entitled to a refund from your airline. This includes the ticket price and any optional fees charged for services that a passenger is unable to use.

If you have already received vouchers for future travel in lieu of refunds for cancelled or delayed flights, the airline should soon be in touch to notify you of your right to a full refund. Ultimately, the situation has provided the starkest reminder possible of the importance of quickly arranging the best travel insurance (opens in new tab) once you have made travel arrangements. 

If you’re missing relatives who live abroad, make use of the best international call services (opens in new tab) to stay in touch with them, and keep an eye on your airline’s website to see when flights are operating again.

With over 20 years’ experience in the financial services industry, Tim has spent most of his career working for a financial data firm, where he was Online Editor of the consumer-facing Moneyfacts site, and regularly penned articles for the financial advice publication Investment Life and Pensions Moneyfacts. As a result, he has an excellent knowledge of almost areas of personal finance and, in particular, the retirement, investment, protection, mortgage and savings sectors.