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Airlines must now pay automatic refunds for canceled flights

Allyson Versprille, Bloomberg News on

Published in Business News

Airlines will now have to provide automatic refunds to travelers if flights are canceled or significantly altered under new U.S. Department of Transportation rules, a significant change for consumers that could drive up costs across the industry.

The final regulations released Wednesday outline the circumstances where passengers are entitled to refunds for all travel to, from and within the U.S. The goal is to make it easier for people to get money back and to make refund policies more consistent from one airline to the next.

According to the department, complaints related to airlines and ticket agents rejecting or delaying refunds made up 87% of all air-travel service complaints at the height of the COVID-19 pandemic in 2020.

“Passengers deserve to get their money back when an airline owes them — without headaches or haggling,” Transportation Secretary Pete Buttigieg said in a statement.

Under the new rule, passengers will be entitled to refunds if there is a “significant change” to their flights. These include:

—Departure or arrival time that moves by more than three hours domestically or six hours for international flights

 

—Being downgraded to a lower class than originally purchased, as from first class to economy

—Change of departure or arrival airport

—Increase in number of connections

—Changes to connecting airports or planes flown if they are less accommodating for people with disabilities

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