New Consumer Protections for Airline Passengers

Banks, hospitals, retailers, and airlines are still dealing with the fallout from the massive CrowdStrike IT outage in July. This tech meltdown impacted businesses across the globe, with airlines hit particularly hard. This could not have come at a worse time for the airline industry, which just last year recorded the highest number of flight delays ever.

The U.S. Department of Transportation (DOT) determined that the delays and cancellations resulting from the CrowdStrike outage were "controllable," meaning they were caused by the airlines themselves. As a result, most airlines were obligated to provide compensation and assistance to stranded travelers.

Fortunately, new federal regulations from the DOT promise much-needed relief for airline passengers in the form of automatic refunds and protections against surprise fees.

Hassle-Free Refunds for Canceled or Delayed Flights

Historically, airline passengers faced significant challenges in obtaining refunds, often spending hours researching airline policies or waiting on hold with customer service. Under the new rules, passengers will be entitled to automatic refunds in the following circumstances:

• Cancelled or Significantly Delayed Flights: If a flight is canceled or significantly delayed (by three hours or more for domestic flights, and by six hours or more for international flights), passengers will be eligible for a refund regardless of the reason.
• Delayed Baggage Return: Passengers will be entitled to refunds if their baggage is significantly delayed.
• Unfulfilled Paid Services: If extra services like Wi-Fi, seat selection, or inflight entertainment that were paid for are not provided, passengers will receive refunds.

Refunds must be issued in the full amount of the ticket purchased within seven business days for credit card purchases and within 20 days for other payment methods. Passengers who accept rebooking or a different flight will not be eligible for a refund. Refunds must be issued in the original payment method (cash, credit card, or airline miles), and airlines cannot substitute other forms of compensation like vouchers unless the passenger chooses to accept an alternative.

Protection Against Surprise Fees

Many airlines advertise low "teaser" fares that do not include additional fees, which can significantly increase the overall cost of a ticket. Under the new rules:

• Full Disclosure of Fees: Airlines must disclose all ancillary fees upfront, including charges for checked bags, carry-on bags, and reservation changes or cancellations. A detailed explanation of each fee must be provided before a ticket can be purchased.
• Family Seating Fees: A proposed rule prohibits airlines from charging extra fees to guarantee that a child sits next to a parent or adult travel companion.

Implementation Timeline for New Protections

These consumer protections will be implemented over the next year. However, the rule on surprise fee disclosures has been temporarily blocked by a U.S. Appeals Court. For more information on these protections, visit the U.S. Department of Transportation’s website at transportation.gov/airconsumer.

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