The Department of Transportation (DOT) has mandated that all United States-based airlines give flyers automatic cash refunds for flight delays and cancellations, as well as any seat selection, in-flight entertainment, or food they may have purchased ahead of the flight.

Secretary of Transportation Pete Buttigieg informed the public about the new policy on October 28, the day the federal rule went into effect.

Buttigieg’s post detailed that a passenger is entitled to an automatic refund if their flight is “significantly” delayed. Moreover, the traveler would have to turn down a rebooked flight and alternative compensation from the airline. Also, carriers must honor all eligible refunds regardless of whether customers explicitly ask for their money back.

“Passengers deserve to get their money back when an airline owes them — without headaches or haggling. Today, our automatic refund rule goes into full effect. Airlines are required to provide prompt cash refunds without passengers having to ask,” Buttigieg stated.

Passengers deserve to get their money back when an airline owes them—without headaches or haggling. Today, our automatic refund rule goes into full effect. Airlines are required to provide prompt cash refunds without passengers having to ask. pic.twitter.com/otIvRaGJxC
— Secretary Pete Buttigieg (@SecretaryPete) October 28, 2024

What Else Is There To Know About Federal Automatic Refunds Rule For Airlines?

Another circumstance where a passenger is eligible for an airline’s automatic refund is if their luggage wasn’t returned 12 hours after the arrival of their domestic flight or up to 30 hours following an international one. The refund would repay those flyers their booking’s checked bag fee. The passenger must have filed a mishandled baggage report to get their money back.

Airlines must issue the refund within seven business days if the customer paid by card. If the purchase was made via a different payment method, the carrier has 20 calendar days to pay up.

All the refunds will be returned to the flyer via the way they made their purchase. For ticket refunds, passengers will receive the amount of their purchase minus the cost of any transportation they may have already embarked on with that carrier for the flight.

“These rules will significantly expand consumer protections in air travel, provide passengers an easier pathway to refunds when owed, and save consumers over half a billion dollars every year in hidden and surprise junk fees,” notes the DOT.