U.S. – based airlines are now required to give passengers automatic cash refunds when a flight is significantly delayed or canceled — even if the customer doesn’t ask for one — under a new Department of Transportation rule.
The rule, which was finalized in April, went into full effect this week ahead of the upcoming holiday travel season.
“Passengers deserve to get their money back when an airline owes them — without headaches or haggling,” Transportation Secretary Pete Buttigieg wrote on social media Monday.
“Our new rule sets a new standard to require airlines to promptly provide cash refunds to their passengers,” the secretary said when first announcing the rule.
Airlines must now automatically process a refund if a flight is “canceled or significantly changed, and [passengers] do not accept the significantly changed flight, rebooking on an alternative flight, or alternative compensation.”
The rule defines a significant delay as more than three hours for a domestic trip and six hours for international. The time limits apply to both scheduled departures and arrivals.
A “significantly changed” flight is one that departs from or arrives at a different airport than originally scheduled, one with an increased number of connections, one where a passenger is downgraded a service level (e.g. business to economy), or one that switches to airports or plane models that are less accessible for a person with a disability.
The refund must be processed within seven days if the ticket was bought with a credit card and within 20 days if paid for by another method.
The rule also requires refunds for delayed or missing checked baggage and pre-paid inflight services, like Wi-Fi or seating, that become unavailable.