Airlines must provide cash refunds for canceled and delayed flights under new DOT regulations

Regulations requiring airlines to quickly pay customers in the case of flight cancellations, delays, or major schedule modifications were recently approved by the Department of Transportation (DOT). When a flight is canceled, airlines are required to reimburse customers in cash or using their original payment method. As an alternative, passengers may choose to use travel credit, make other travel plans, or take a different airline aircraft.

Additionally, if the airline offers an alternate route and a customer declines it, they have the right to a refund in the event that the flight schedule is significantly altered. This covers adjustments to departure or arrival times, such as a three-hour or longer delay for domestic flights or a six-hour or longer delay for international flights. The guideline also applies when there are adjustments made to the airport of departure or arrival.

Additionally, airlines are required to reimburse customers for the baggage cost in the event that there are significant delays in the delivery of paid checked luggage. This reimbursement is valid if travelers do not collect their luggage within certain window of time, such as 12 hours after the gate arrival of a domestic aircraft or 15–30 hours following the arrival of an international flight.

Additionally, the DOT has announced plans to require airlines to disclose extra fees—like those for checked luggage and reservation cancellations—before travelers buy tickets in order to impose greater openness.

US Transportation Secretary Pete Buttigieg stated in a statement, “Airlines should compete with one another to secure passengers’ business—not to see who can charge the most in surprise fees.””DOT’s new rule will save passengers over half a billion dollars a year in unnecessary or unexpected fees by holding airlines accountable for being transparent with their customers.”

In order to provide passengers with more protection and transparency in the case of flight interruptions, the DOT’s new rules will be gradually implemented over the course of the next six to twelve months.