The global spread of COVID-19, or the novel coronavirus, has wreaked havoc across the travel industry, causing airlines to lose millions in revenue and face new travel restrictions amid the public health crisis. Now the U.S government has announced that all airlines must pay refunds to customers whose flights were canceled due to the coronavirus outbreak.
The U.S. Transportation Department made the announcement today after receiving a growing number of complaints from consumers regarding airlines not providing refunds for canceled flights.
“The Department is receiving an increasing number of complaints and inquiries from ticketed passengers, including many with non-refundable tickets, who describe having been denied refunds for flights that were cancelled or significantly delayed,” the agency said in a notice.
The order would be applied to all domestic and international flights for flights to, within, or from the U.S. that have been grounded as a result of the virus. The government also mentioned it would “exercise its prosecutorial discretion” to allow airlines time to contact customers and their update policies.
This comes after many travel platforms like Airbnb have been forced to change their cancellation and refund policy in light of the viral pandemic. According to the International Air Transport Association, airlines around the world owe their customers an estimated $35 billion in refunds and credits this financial quarter due to the public health crisis.
The Federal Trade Commission has also received more than 1,600 travel-related complaints linked to flight cancellations resulting from the coronavirus. The complaints from customers equate to $2.7 million in nonrefundable travel losses.
“The obligation of airlines to provide refunds, including the ticket price and any optional fee charged for services a passenger is unable to use, does not cease when the flight disruptions are outside of the carrier’s control,” the agency said according to Bloomberg News.
“Although the COVID-19 public health emergency has had an unprecedented impact on air travel, the airlines’ obligation to refund passengers for cancelled or significantly delayed flights remains unchanged.”