For decades, it has been notoriously difficult for travelers to get a refund from an airline if their flight is canceled. In many cases, carriers will simply issue a voucher for the money the passenger already spent. However, the voucher can only be used towards a future flight on that airline, essentially giving the airline an interest-free loan and leaving the customer without their cash.
On Wednesday, the U.S. Department of Transportation published a new proposal that, among other things, would allow for a major expansion of consumer rights when it comes to cancelations and refunds for both domestic and international flights — and great peace of mind for those who are purchasing tickets.
Below, Select outlines the story behind the new proposal, how it would affect your future travels and how you can best protect yourself as a traveler.
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The DOT is fighting for fair compensation for flyers
The new proposal comes straight from the desk of Secretary of Transportation Pete Buttigieg on the heels of what has so far been a pretty rough year for airlines. Recent headlines have been flooded with stories of lost luggage and carriers simply not having enough employees to fly their customers.
According to the Bureau of Transportation Statistics, out of the more than 2.73 million flights so far in 2022, roughly 20% have been delayed while another 3% have been outright canceled. In June, Buttigieg himself urged airline CEOs to fix the problems at hand before a busy Fourth of July weekend.
It's also worth noting that current frustrations with airlines have been building from both the public and lawmakers since the onset of the Covid-19 pandemic. After taxpayer-funded bailouts were issued in 2020 to help save U.S. carriers from bankruptcy, there were hopes that things would return to normal. Now, with an abundance of travelers and a lack of employees to handle the summer rush, flying has been a mess.
Bearing all that in mind, the proposal comes at a good time, offering travelers some hope of change to come. Here's a look at how this could end up affecting your future travels.
What the new proposal could mean for travelers
In the DOT's press release, Buttigieg says, "This new proposed rule would protect the rights of travelers and help ensure they get the timely refunds they deserve from the airlines."
As of now, airlines aren't legally bound to give customers any sort of compensation for delayed or canceled flights, as well as if you miss your flight due to illness. However, many airlines will accommodate passengers as best as possible. The only case where they are required to provide assistance is when a passenger is "bumped" from a flight due to it being oversold.
The 116-page proposal, which is reminiscent of the EU's Air Passenger Rights, puts forward that consumers flying domestically or internationally should be given a full refund based on their original payment method, whether that's cash, credit or airline miles. Airline passengers will be eligible for a refund in any of the following circumstances, as long as they don't accept alternative transportation from the airline:
- If your flight is canceled
- Whenever departure or arrival times are delayed by at least three hours for domestic flights or by at least six hours for international flights, if flyers opt-out of taking the flight
- Anytime the departure or arrival airport changes or the number of connections is increased on an itinerary
- If the original aircraft has to be replaced by another but there's a major difference in the onboard amenities offered and overall travel experience as a result
The proposal also states that airlines would be required to issue vouchers with no expiration date whenever passengers are "unable to fly for certain pandemic-related reasons, such as government-mandated bans on travel, closed borders, or passengers advised not to travel to protect their health or the health of other passengers."
Additionally, if the airline or ticket agent involved has received pandemic-related government assistance, refunds to the original method of payment would have to be provided, rather than travel credits or vouchers.
So, what happens next?
While it's exciting to think about, the proposal is still just that, and has not been signed into law just yet. Members of the public are invited to attend a virtual meeting hosted by the Aviation Consumer Protection Advisory Committee that's scheduled for Aug. 22, 2022.
Any comments you wish to make regarding the proposal can be submitted here under docket number DOT-OST-2022-0089. From there, the committee will examine its findings and adjust the proposal as needed.
As for the likelihood that the proposal will be enacted, it seems airlines are at least somewhat supportive of making these changes. The document states, "They [the airlines] expressed support for the Department's effort to codify its longstanding policy regarding refunds."
Henry Harteveldt, travel industry analyst at Atmosphere Research Group, tells Select "this has a decent chance of getting through" as there has been compounding frustration from flyers and those on Capitol Hill. However, he notes there may be adjustments to the current proposal before it's confirmed as the standard rule for airlines.
Where travel insurance comes into play
If this is signed into law, it'll be a huge win for travelers everywhere. Personally, I've been on the wrong end of flight delays and cancellations and it's never a fun experience.
Regardless of what happens, there are still some ancillary costs to consider whenever flights are canceled or delayed, and this is where using the right credit card comes in handy, as some offer better protections than others.
For example, in Dec. 2021, my flight from San Diego to Fort Lauderdale was canceled, forcing me to stay overnight at an airport hotel. I also had to buy additional food and pay for a taxi to get around. While the new DOT proposal is helpful to consumers in some ways, it still doesn't include any coverage for any of the unexpected costs associated with flight cancelations.
Thankfully, in my case, the included travel insurance protections from my Chase Sapphire Preferred® Card (see rates and fees) covered these additional expenses. Travel insurance from a travel rewards credit card can also provide peace of mind when you're dealing with other problems that may arise during your trip, including medical emergencies and rental car issues, among other stressful scenarios.
If you're in the market for a new travel rewards credit card, consider signing up for one that includes complimentary travel insurance to protect you in case things go awry. Here are a few credit cards that offer comprehensive coverage for all your upcoming travels.
The Chase Sapphire Preferred® Card packs a punch for a $95 annual fee card, offering annual travel credits, comprehensive travel protections, flexible rewards and more.
- You can transfer rewards to all of Chase's travel partners including World of Hyatt, Southwest Rapid Rewards and many more
- Long list of travel and shopping protections
- Annual Chase Travel hotel credit
- Has an annual fee
- Requires a high credit score
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- Earn 75,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.
- Enjoy benefits such as 5x on travel purchased through Chase TravelSM, 3x on dining, 3x on vacation homes, 3x on gas & EV charging, 3x on top streaming services and online groceries (excluding Walmart, Target, and wholesale clubs), 2x on all other travel purchases, 1x on all other purchases
- Earn up to $100 in statement credits each account anniversary year for hotel stays through Chase Travel
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Emergency Evacuation and Transportation and more
- Get a year of complimentary Apple TV when activated by December 31, 2026 - a value of $156.
- Complimentary DashPass which unlocks $0 delivery fees & lower service fees for 12 months when you activate by 12/31/27. Plus, a $10 promo each month on non-restaurant orders.
- Receive one statement credit of up to $120 every four years as reimbursement for the application fee charged to your card for a Global Entry, TSA Precheck® or NEXUS application.
- Transfer points to leading airline and hotel loyalty programs
- Member FDIC
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
The American Express Platinum Card® is a premium card loaded with annual statement credits, entertainment benefits, extensive airport lounge access, elite status perks and more. (Enrollment required for select benefits mentioned)
- Access to 1,550+ airport lounges, including Priority Pass™ lounges (enrollment required) and Amex Centurion lounges
- Statement credit offers worth up to twice what the annual fee costs
- Elite status perks for hotels and rental cars (Enrollment required for select benefits mentioned)
- High annual fee
- Many statement credit offers are complicated and are earned in increments or limited to specific purchases
- Not as rewarding for purchases as other lower-fee travel cards
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- You may be eligible for as high as 175,000 Membership Rewards® points after you spend $12,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you're approved and find out your exact welcome offer amount – all with no credit score impact. If you're approved and choose to accept the Card, your score may be impacted.
- Get more for your travels with 5X Membership Rewards® points on all flights and prepaid hotel bookings through American Express Travel®, including Fine Hotels + Resorts® and The Hotel Collection bookings. You earn 5X points on flights purchased directly from airlines or through American Express Travel® on up to $500,000 on these purchases per calendar year.
- With over 1,550 airport lounges - more than any other credit card company on the market* - enjoy the benefits of the Global Lounge Collection, over $850 of annual value, with access to Centurion Lounges, 10 Delta Sky Club visits (subject to visit limitations) when flying on an eligible Delta flight, Priority Pass™ membership (enrollment required), and other select partner lounges. *As of 01/2026
- $200 Uber Cash + $120 Uber One Credit: With the Platinum Card® you can receive $15 in Uber Cash each month plus a bonus $20 in December when you add your Platinum Card® to your Uber account to use on rides and orders in the U.S when you select an Amex Card for your transaction. Plus, when you use the Platinum Card® to pay for an auto-renewing Uber One membership, you can get up to $120 in statement credits each calendar year. Terms apply.
- $300 Digital Entertainment Credit: Experience the latest shows, news and recipes. Get up to $25 in statement credits each month when you use your Platinum Card® for eligible purchases on Disney+, a Disney+ bundle, ESPN streaming services, Hulu, The New York Times, Paramount+, Peacock, The Wall Street Journal, YouTube Premium, and YouTube TV when you purchase directly from one or more of the providers. Enrollment required.
- $600 Hotel Credit: Get up to $300 in statement credits semi-annually on prepaid Fine Hotels + Resorts® or The Hotel Collection* bookings through American Express Travel® using the Platinum Card®. *The Hotel Collection requires a minimum two-night stay.
- $400 Resy Credit + Platinum Nights™ by Resy: Get up to $100 in statement credits each quarter when you use the Platinum Card® to pay for eligible purchases with Resy, including dining purchases at over 10,000 qualifying U.S. Resy restaurants. Enrollment required. As a Platinum Card® Member you have special access to reservations on select nights at participating sought after Resy restaurants in select cities through Platinum Nights™ by Resy. Simply add your Platinum Card® to your Resy profile to book your reservation.
- $219 CLEAR+ Credit: CLEAR+ helps get you to your gate faster by using your face to verify you are you at 55+ airports nationwide. You can cover the cost of a CLEAR+ Membership* with up to $219 in statement credits per calendar year after you pay for CLEAR+ with your Platinum Card®. *Excluding any applicable taxes and fees. Subject to auto-renewal.
- $200 Airline Fee Credit: Select one qualifying airline and then receive up to $200 in statement credits per calendar year when incidental fees, such as checked bags and in-flight refreshments, are charged by the airline to the Platinum Card® Account. American Express relies on airlines to submit the correct information on airline transactions to identify incidental fee purchases. If you do not see a credit for a qualifying incidental purchase on your eligible Card after 8 weeks, simply call the number on the back of your Card. Qualifying airlines are subject to change. See terms & conditions for more details.
- Start your vacation sooner and keep it going longer. When you book Fine Hotels + Resorts® through American Express Travel®, enjoy noon check-in, when available, and guaranteed 4PM late check-out.
- $300 lululemon Credit: Enjoy up to $75 in statement credits each quarter when you use the Platinum Card® for eligible purchases at U.S. lululemon retail stores (excluding outlets) and lululemon.com. That's up to $300 in statement credits each calendar year. Enrollment required.
- $155 Walmart+ Credit: Get up to a $12.95* statement credit back each month after you pay for a monthly Walmart+ membership (subject to auto-renewal) with your Platinum Card®. *Up to $12.95 plus applicable taxes on one membership fee.
- Whenever you need us, we're here. Our Member Services team will ensure you are taken care of. From lost Card replacement to statement questions, we are available to help 24/7.
- $895 annual fee.
- Terms Apply.
- See Rates & Fees
Balance transfer fee
N/A
Foreign transaction fee
None
The Chase Freedom Flex® is an excellent cash-back card with generous rotating quarterly categories. In additional the rewards, you also can take advantage of the intro APRs for purchases and balance transfer for more than a year.
- Long intro APR for purchases and balance transfers
- Rewarding quarterly bonus categories
- No annual fee
- Bonus categories are capped each quarter
- Has a foreign transaction fee
Rewards
- 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate (then 1%)
- 5% cash back on travel booked through Chase Travel℠
- 3% on drugstore purchases and on dining (including takeout and eligible delivery services)
- 1% cash back on all other purchases
Balance transfer fee
Intro fee of either $5 or 3% of the amount of each transfer, whichever is greater, on transfers made within 60 days of account opening. After that, either $5 or 5% of the amount of each transfer, whichever is greater.
Foreign transaction fee
3%
The United℠ Explorer Card is worth it even if you only fly with United Airlines once or twice a year because you can take advantage of two United Club℠ passes per year when the primary cardmember or authorized user is traveling and you can receive free checked bags.
- No annual fee for the first year
- Unlocks upgrades for elite members on award flights
- Two free United Club airport lounge passes every year
- Valuable United Airlines perks, such as in-flight purchase discounts and the ability to earn elite status credit through credit card spending
- First checked bag free benefit requires you to pay for the flight with the card
- United Airlines has a dynamic award chart which can limit the value and flexibility of your miles
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- Earn up to 60,000 bonus miles
- $0 introductory annual fee for the first year, then $150
- NEW! 9x total miles on eligible United flights and 3x miles on all other eligible United® purchases
- 2x miles on dining and hotel stays when booked with the hotel. 1x mile on all other purchases.
- Free first checked bag - a savings of up to $200 per roundtrip. Terms Apply. Plus, priority boarding on United® flights.
- 2 United Club one-time passes per year - over a $100 value
- Over $500 in partner credits each year
- NEW! Save 10% or more when booking flights with miles. Premier members save even more.
- Member FDIC
Bottom line
Flying can be a stressful experience for several reasons, but if this proposal is signed into law, the changes it suggests would help American travelers feel more secure in that they won't be left empty-handed if their flight is delayed or canceled.
In the meantime, if you're a regular flyer who may have been given a travel credit or voucher recently instead of a full refund, sign up for the public webinar on Aug. 22 to voice your frustrations. If you're planning a vacation for the fall or winter, it might be a good idea to sign up for a travel rewards credit card that comes with travel insurance to ensure you're protected from additional flight cancelation-related expenses.
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For rates and fees of the American Express Platinum Card®, click here.
