New rules require airlines to refund passengers for canceled, delayed flights

New rules require airlines to refund passengers for canceled, delayed flights

WASHINGTON (NEXSTAR) – Getting travel refunds and avoiding extra fees could be easier for fliers soon, thanks to two new federal rules. On Wednesday, the Transportation Department announced regulations to require quick and automatic refunds and to crack down on hidden costs.

When travel plans go wrong, it can be a hassle to get your money back.

“In theory passengers are already supposed to be refunded for a cancellation or a major delay. In practice, it often doesn’t work that way,” Transportation Secretary Pete Buttigieg said.

That’s why Sec. Buttigieg says the Biden administration is issuing a new refund rule that will force airlines to automatically refund travelers if their flights are significantly delayed or their baggage gets lost for an extended period of time.

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Passengers won’t have to fill out a bunch of online forms of wait hours on the phone for their refunds. Under the rule airlines must issue refunds within a week, offering cash or a credit card refund first instead of travel vouchers or flight credits.

“This is a big day for America’s flying public.” Sec. Buttigieg said.

Erin Witte with the Consumer Federation of America agrees.

“Consumers won’t have to spend time chasing down refunds, trying to figure out whether they’re eligible. The burden is going to be shifted back to airlines or the ticket agent,” Witte said.

She says the new rule gives travelers more control.

“Allow them to say no I don’t want to spend my money on your airline, you treated me terribly. I want that money back in my pocket,” Witte said.

The department also announced a second rule targeting hidden fees. It will require airlines to list extra costs up front for things like carry-on bags or flight changes.

“We estimate this will save Americans over a half a billion dollars every year,” Sec. Buttigieg said.

Witte expects both rules will have important consumer benefits.

“Giving that power back to consumers and allowing them to make a choice,” Witte said.

The goal is to give airlines more incentive to avoid issues in the first place.

“This isn’t just about enforcing when something goes wrong. It’s making it less likely something would go wrong,” Sec. Buttigieg said.

The rules are expected to take effect in about six months.

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