I booked a nonrefundable hotel rate — reader mistake story
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Today, I want to share a story from TPG reader Nisha, whose attempt to save money may have ended up costing her instead:
In early February, I booked a trip to Switzerland for the end of March, figuring I’d enjoy some solo travel while my husband was away at a conference. All of my hotels I booked were refundable except one, which did not offer fully-refundable rates. The most generous policy available at that hotel was a partially-refundable rate with a nonrefundable deposit. Since the nonrefundable rate was about 20 to 25% lower than the partially-refundable rate, I went for the nonrefundable rate. I wanted to stay at that hotel given its rave reviews and prime location, and figured to myself “what could go wrong?”
Then, of course, coronavirus hit, and my husband’s conference got canceled. Given that and the growing number of cases in Switzerland, I decided to also cancel my trip. I had used miles, and United graciously waived the mileage redeposit fee. After canceling the refundable hotels, I contacted Hotels.com to see what I could do about the $200 nonrefundable hotel. They contacted the property to see if it was willing to issue a refund, but the hotel stuck to its cancellation policy.
I then called customer service for my Chase Sapphire Reserve (which I had used to book the hotel) to see if I had any recourse, but since Switzerland wasn’t officially on the list of places under a travel advisory, they refused to dispute the charge, which is completely understandable. Fortunately, I contacted the hotel directly and was able to negotiate credit for a future stay. I’ll have to pay any difference in rates and the next booking will also be nonrefundable, but it’s better than nothing.
Lesson learned: Since you never know what can happen that’s 100% out of your control, better to never book a nonrefundable rate no matter how attractive it seems. If I can avoid it, I’ll never book a nonrefundable rate again!
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Nisha’s mistake wasn’t booking a nonrefundable rate; instead, it was asking “what could go wrong?” and failing to see any answers. The travel industry is experiencing unprecedented disruptions due to COVID-19, and I wouldn’t fault anyone for failing to anticipate its impact. However, it’s not hard to envision myriad other scenarios that might require you to cancel a trip: you or a family member could fall ill; a natural disaster could strike your destination; even something mundane like a change in your work schedule could force your hand. In short, the chances you will have to cancel a trip are rarely (if ever) zero.
The trick is to estimate earnestly what those chances are, and to weigh them against your potential savings. The first number depends on a variety of factors, including the complexity of your itinerary, how far in advance you’re booking and the extent to which your plans depend on other people. As a rule of thumb, I think you should lean toward booking a refundable rate if the likelihood of having to cancel is greater than or equal to the percentage increase in cost. For example, if you think your odds of having to cancel are 10%, then you should be willing to pay up to 10% more for a refundable rate. This approach isn’t mathematically precise, but it’s a serviceable approximation if you’d rather not break out a calculator every time you book a hotel room.
Finally, another incentive to book a refundable rate is that rates may drop. If you’re locked in to a nonrefundable rate, then you can’t take advantage of lower prices. If your rate is refundable, however, then you can simply rebook at the lower rate and pocket the difference. In summary, I think nonrefundable rates are worth considering, but make sure you’re clear about the risks and rewards.
I appreciate this story, and I hope it can help other readers avoid making the same mistake. In appreciation for sharing this experience (and for allowing us to post it online), I’m sending Nisha a gift card to enjoy on future travels, and I’d like to do the same for you. Please email your own travel mistake stories to firstname.lastname@example.org, and put “Reader Mistake Story” in the subject line. Tell us how things went wrong, and (where applicable) how you made them right. Offer any wisdom you gained from the experience, and explain what the rest of us can do to avoid the same pitfalls.
Feel free to also submit your best travel success stories. If your story is published in either case, I’ll send you a gift to jump-start your next adventure. Due to the volume of submissions, we can’t respond to each story individually, but we’ll be in touch if yours is selected. I look forward to hearing from you, and until then, I wish you a safe and mistake-free journey!
Featured photo by © Marco Bottigelli/Getty Images.
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