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These airlines have been the worst — and best — about refunds

July 06, 2020
7 min read
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April 2020 was the slowest month for U.S. domestic travel since the outset of the global pandemic.

With many would-be travelers stuck at home under shelter-in-place orders, some airlines got stingy about providing refunds for canceled flights. Those who've followed TPG coverage know that when an airline cancels a flight to, from or within the United States, you're entitled to a refund — regardless of the reason for the cancellation.

That's thanks to U.S. Department of Transportation (DOT) policy. When an airline violates the rule, one of the best courses of action is to file a consumer complaint with the DOT, as well as a credit card chargeback.

Each month, the DOT aggregates the complaints and publishes an Air Travel Consumer Report. June's report contains complaint data from April, so let's take a deeper look at how the airlines behaved at the height of the pandemic.

Refunds continued to be the top issue in April

Nearly 95% of all complaints that the DOT received about U.S. carriers were related to refunds. In absolute terms, that's 7,700 refund-related complaints out of the roughly 8,000 total.

The same story applies to international carriers. 81% of non-U.S. airline complaints were about refunds.

This massive spike in complaints translates to a 17,641% increase year-over-year, and a 534% increase month-over-month from March 2020 to April 2020. It's no wonder that the DOT's recent enforcement notices cite an "unprecedented" increase in the number of refund-related complaints.

This dramatic rise shows that airlines weren't necessarily playing by the rules — and that travelers knew to take matters into their own hands by escalating their case with the DOT.

Of the three largest U.S. airlines, United continued to be stingy

After March's report, I predicted that United would receive a significant spike in complaints, and indeed it did. In April 2020, United Airlines ended up in the top spot for complaints against the major U.S. carriers.

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United Polaris (Photo by Zach Griff/ The Points Guy)

If you’re a United flyer, odds are that you’ve had trouble getting a refund from the Chicago-based carrier. That’s because UA made many adjustments to its schedule change policy throughout the pandemic. Before the coronavirus hit, you could get your money back when your flight was changed by more than two hours.

Throughout March and into April, United kept adjusting what time change qualifies for a refund. It went up to 25 hours, then went to an undefined “significant” change and then finally went down to six hours. UA applied these changes retroactively as well, rankling many customers.

Looking at the April data, United received 2,727 complaints regarding refunds or roughly 1,200 complaints per 100,000 enplanements. That's about eight times more than both American Airlines and Delta.

And like in March, both American and Delta were neck-and-neck for the number of complaints related to refunds. Neither has been nearly as stingy as United.

American did make a customer-unfriendly change to its schedule change policy for new tickets issued in April and onwards, so it'll be interesting to track how the complaint data changes in the coming months.

Southwest was the best U.S. airline about refunds

Based on the DOT data for April, Southwest received the fewest refund-related complaints of any major U.S. carrier. Specifically, the Dallas-based carrier received about 101 complaints per 100,000 enplanements.

In my mind, this comes down to Southwest's year-round flexible change policy. Flyers can always make free changes and cancellations to their tickets, so long as they reuse the credit within a year of ticket issue.

This generous policy is wellknown among loyal passengers. Plus, the travel-fund expiration was extended across the board, so Southwest flyers have plenty of time to use their credits.

Southwest check-in counters in Maui (Photo by Zach Griff/The Points Guy)

Getting your money back for a nonrefundable ticket requires the airline to cancel your flight. But a portion of Southwest flyers likely didn't need or want to wait until the last minute to see if the airline canceled their flight since they're familiar and comfortable with future travel credit (that'll soon be convertible to Rapid Rewards points.)

Hawaiian said aloha to refunds

Like United, the Hawaii-based carrier was one of the stingiest about refunds. It continued to defy the DOT rules for months, having just recently retracted its strict cancellation policy.

Though Hawaiian had only 197 refund-related complaints in April, that's a massive number when normalizing for emplanements. In fact, it's 931 complaints per 100,000 enplanements, which puts Hawaiian as the third-worst U.S. airline when it comes to refunds, according to the DOT data.

Ultra low-cost carriers like Frontier and Spirit weren't great either

Across the entire set of U.S. airlines, Frontier was the stingiest about refunds. The DOT received 850 refund-related complaints, or about 2,000 per 100,000 enplanements. In March, United took the top spot. This time, it was Frontier which was about twice as bad as than United.

That's likely due to the fact that Frontier proactively gave out restrictive vouchers for canceled flights. And some passengers didn't even realize they were entitled to a refund instead since the fine print on the cancellation emails we've seen was incredibly small.

Allegiant and Spirit were stingier than American and Delta, but not nearly as bad as Frontier, United or Hawaiian.

Air Canada, TAP took the top spot for international carriers

Though Air Canada has been one of the best airlines at engaging its grounded frequent flyers, the airline has been downright awful about refunding canceled flights.

The carrier continues to argue that it doesn't have to follow DOT policy, and it's not giving any refunds for canceled flights to or from the U.S. This restrictive policy led to the carrier's spot as the most complained-about foreign airline. (WestJet also adopted a similar policy and saw a high number of complaints.)

Air Canada Boeing 777 (Photo by JL IMAGES/Shutterstock)

TAP Air Portugal also saw a high number of refund-related complaints. That's likely due to the fact that it continued flying many of its U.S. routes in April, meaning that you weren't eligible for a refund (since the flight actually operated.)

Bottom line

By now you should know that you're entitled to a refund when your flight is canceled by the airline.

But just because you're entitled to one doesn't mean the airlines are making it easy for you to get your money back. Frontier, Hawaiian and United continued to be the worst offenders in April. American, Delta and Southwest were some of the best of the U.S. carriers.

Time will tell how the airlines performed in May, but hopefully, we'll begin seeing fewer refund-related complaints as travel slowly begins to restart.

This post has been updated to reflect the correct number of refund-related complaints for United Airlines.

For more about refunds, see:

Featured image by (Photo by Zach Griff/The Points Guy)

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Why We Chose It

It's hard to find a card that competes with the mile-long list of benefits that come with the Amex Business Platinum. While it's certainly not the card for the average consumer, a business owner with tons of expenses -- especially related to travel -- will find this card incredibly valuable. This card is similar to the consumer version that Amex offers, but with more business-oriented perks around statement credits and earning rates that are a better fit for business owners.

Pros

  • An up to $100 credit for Global Entry or TSA PreCheck application fee every four to five years
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  • Gold status at Marriott and Hilton hotels (enrollment required)
  • Access to the Fine Hotels & Resorts program and Hotel Collection
  • Extended warranty protection
  • International Airline Program and Cruise Privileges Program

Cons

  • Steep annual fee
  • Difficulty meeting $15,000 welcome offer for smaller businesses
  • Limited high-bonus categories outside of travel
  • The Points Guy Exclusive Offer: Earn 150,000 Membership Rewards® points after you spend $15,000 on eligible purchases with the Business Platinum Card® within the first 3 months of Card Membership.
  • Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com, and 1X points for each dollar you spend on eligible purchases.
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  • Unlock over $1,000 in annual statement credits on a curation of business purchases, including select purchases made with Dell Technologies, Indeed, Adobe, and U.S. wireless service providers.
  • $200 Airline Fee Credit: Get up to $200 in statement credits per calendar year for checked baggage fees, lounge day passes, and more at one selected airline.
  • $189 CLEAR® Credit: Use your Card and get up to $189 back per year on your CLEAR® membership. CLEAR® is available at more than 50 U.S. airports and stadiums.
  • The American Express Global Lounge Collection® can provide an escape at the airport. With more than 1,400 airport lounges across 140 countries and counting, you have more lounge location options than any other credit card on the market as of 9/2021.
  • $695 Annual Fee.
  • Terms Apply.