New refund rule for air travelers is now in effect. Here's what to know

The Department of Transportation’s new refund policy for delayed and canceled flights is now fully in effect. 

The new rule requires what they are calling “automatic refunds” for passengers for significant flight delays and cancellations. 

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But under what circumstances are you entitled to a refund? 

According to the Department of Transportation, any cancellation or significant change in a flight is eligible, regardless of the reason for it. This includes weather-related cancellations. 

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The DOT defines a significant delay as departure or arrival times that are more than three hours domestically or six hours internationally delays from the original flight time. 

Significant changes to your itinerary are also eligible for a refund. For example, arrivals from a different airport or an increase in the number of connections can entitle you to a refund. 

You are also entitled to a refund if you filed a mishandled baggage report and the luggage is not delivered within 12 hours of your domestic flight arriving at the gate, or 15 to 30 hours of your international flight arriving at the gate, depending on the length of the flight. 

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Under these new rules, airlines must issue a refund automatically without the passenger specifically asking for it. 

They have seven days to refund the money for credit card purchases and 20 days for other forms of payment. 

“What automatic actually means in terms of timelines. Yes, they are held to that seven business days threshold,” said Katy Nastro with the Going travel app.

Nastro says the automatic refunds may look different depending on the airlines.  

“However, you know, for example, one airline might constitute automatic as 72 hours, 24 hours. Could it be five business days? You know, there might not be consistency across airlines …However, seven business days is a lot less time than some situations where people requested a refund and didn't see it for months and months and months,” Nastro said. 

She says it is important to keep in mind that you are only entitled to a refund for a canceled or delayed flight as long as you choose not the take alternative flights offered by the airline. 

“Even though it should be automatic, if you haven't seen that within seven business days, you can contact the airline. I would suggest contacting them once, twice, see if you get two different agents. They might be able to assist and if you're not getting anywhere, you can always file a complaint with the DOT and that just means going to transportation.gov,” Nastro said. 

The new rule also requires refunds for non-functional or unavailable paid services like Wi-Fi.

You can read the DOT’s rule for air passengers here.