New Federal Rules Mandate Automatic Cash Refunds for Delayed or Canceled Flights

A new regulation from the U.S. Department of Transportation, effective as of October 28, 2024, requires airlines to automatically issue cash refunds to passengers affected by significant flight disruptions. This rule aims to establish clear and uniform criteria for airlines when they cancel, postpone, or significantly alter flights.

Under the new rules, if a domestic flight is delayed by more than three hours or an international flight is delayed by more than six hours, airlines are required to provide a full refund. This refund must be issued in the original payment method, which can include cash, credit cards, or airline miles. For credit card transactions, refunds must be processed within seven days, while other payment methods have a 20-day window.

The regulation also addresses other issues such as luggage and prepaid services. Passengers are entitled to refunds for luggage that is missing for over 12 hours on domestic flights or 15 hours on international flights, although they must first submit a report for mishandled baggage. Additionally, refunds will be provided for prepaid services like seat selection and Wi-Fi if these services are not delivered.

Transportation Secretary Pete Buttigieg emphasized that passengers have the right to receive their money back from an airline without unnecessary complications or negotiations. This move is particularly timely as it coincides with the approaching holiday travel season, a period when flight disruptions can be more frequent.

Major airlines, including United and Southwest Airlines, have confirmed that they will comply with these new regulations and offer full refunds as required.