A proposed law could give airline customers extra protection for refunds. The Cash Refunds for Coronavirus Cancellations Act of 2020 has been created to require airlines to make cash refunds to customers who decide to cancel flights for any reason during the COVID-19 pandemic.
The current law requires airlines to provide refunds when flights are canceled without providing any 'reasonable' alternative itineraries. However, that refund protection isn't in place if a customer decides to cancel a flight. This seemed reasonable enough before the COVID-19 pandemic. However, airline customers are finding it hard to make long-term plans for travel when facts, information and headlines regarding the spread of COVID-19 are rapidly changing.
The U.S. Department of Transportation has already been forced to issue warnings to airlines regarding passenger refunds. Many airline customers filed complaints this spring after being offered vouchers instead of cash refunds. Unfortunately, many customers who are unfamiliar with the law have been talked into accepting vouchers for future travel by airline agents when they were really entitled to full cash refunds. In fact, it appears that some airlines may have actually used travel vouchers as the default reimbursement method unless passengers made special requests.
Most airlines appear to be complying with the requirement to issue full cash refunds when flights are canceled. Some have even moved on to enticing customers to accept vouchers by offering bonuses totaling 20 percent to 30 percent of a ticket's value for customers who accept vouchers. However, that still does nothing for customers who make the decision to cancel based on legitimate COVID-19 fears.