The Biden administration announced on Wednesday that airlines will soon face stricter rules for issuing refunds, with changes that aim to protect passengers’ rights and save travelers an estimated half-billion dollars annually. The U.S. Department of Transportation outlined new regulations that will require airlines to automatically refund eligible travelers within seven to 20 days, depending on the payment method used.
In addition to automatic refunds, airlines will also have to more clearly disclose fees for ancillary charges like seat selection and baggage upfront. The Department of Transportation will enforce stricter rules for refunding late bags and faulty Wi-Fi, ensuring that passengers are compensated for services not received.
Transportation Secretary Pete Buttigieg emphasized the importance of transparency and consumer protection, stating that passengers deserve to know upfront what costs they are facing and should receive refunds when airlines owe them without having to ask.
The new rules, expected to take effect by October, will require airlines to issue refunds for canceled flights, significant delays, and changes to itineraries. Passengers will be entitled to refunds when their flights are significantly delayed or changed, with specific criteria outlined by the DOT to determine what constitutes a significant change.
Airlines will also be required to refund baggage fees for significantly delayed luggage and issue refunds for ancillary fees paid when services are not received, such as Wi-Fi. The Biden administration’s new rules aim to provide greater transparency and protection for airline passengers, ensuring that they are fairly compensated for disruptions and services not provided.