A Guide to the Department of Transportation's Airline Refund Rules

The Department of Transportation (DOT) issued a new rule last week detailing when airlines owe travelers a refund and how they have to pay. But like all good things, it comes with a few caveats.

Under the new rules, all airlines in the United States will now be required to refund travelers for significant changes to their flight, baggage delays, and other instances, but it’s important to know what your options are when it comes to getting your money back.

Travel + Leisure broke down the new rules and what frequent fliers need to know about them before your next trip.

When do airlines need to issue a refund?

Travelers are entitled to automatic refunds when their flights are canceled or significantly changed or if the airline fails to provide an extra service they purchased, like onboard Wi-Fi, seat selection, or inflight entertainment. When it comes to changes, the refund is only available if a traveler has not accepted alternative transportation or travel credits offered.

What constitutes a “significant change?”

As part of the new rule, the DOT has defined a “significant change” as: 

• A departure or arrival time that is more than three hours from the original time for domestic flights
• A departure or arrival time that is more than six hours from the original time for international flights
• Changes to the departure or arrival airport
• An increase in the number of connections
• A downgrade to a lower class of service
• A connection at a different airport or flights on different planes that are less accessible or accommodating to a person with a disability

What about delayed bags?

Passengers who file a mishandled baggage report are also now entitled to a refund of the checked bag fee if their bag is not delivered within 12 hours of their domestic flight arriving at the gate, or not delivered within 15 to 30 hours of their international flight arriving at the gate, depending on the length of that flight.

How will travelers receive their refund?

Airlines are now required to automatically issue a refund without a passenger having to request one. Refunds must be issued within seven business days for credit card purchases and within 20 calendar days for other payment methods.

Can you get your money back in cash?

Yes. One of the benefits of this new rule change is airlines can no longer offer a travel voucher — which tends to come with an expiration date — and call it a day. Instead, the refund must be issued in cash or the original form of payment (like a credit card or miles). Airlines can substitute travel vouchers or other forms of compensation if the passenger willingly accepts it.

Airlines must also promptly notify consumers affected by a canceled or significantly changed flight of their right to a refund.

When does the new rule go into effect?

The new rule regarding refunds will take effect on Oct. 28.

Can travelers receive compensation for any other reason?

Yes. Passengers who are unable to travel to, from, or within the U.S. because of a medical issue due to a serious communicable disease are now entitled to a travel credit or voucher. These vouchers must be transferable and valid for at least five years from the date they are issued.

In these instances, travelers may be required to provide evidence of their reason for not traveling. 

This new rule will go into effect on April 28, 2025.