Airlines and Cruise Lines – Incentives for not canceling?

It seems that airlines are now cruise lines are offering incentives for not canceling tickets but what should we know about this?

Remember that airlines want to keep your business – when a flight is cancelled, airline systems usually rebook you on the closest available alternative schedule and assume you accept the changes unless you state otherwise. When that’s not possible (or not acceptable) to the traveler, airlines encourage you to make other free changes to the date or destination, even if that travel is far into the future. 

For noncommittal travelers, they’ll offer credit vouchers for future flights. For instance, one report out there says that American Airlines is offering at least some passengers a 20% bonus when they opt for a future travel credit with the airline instead of a cash refund for the flight.

Airlines are also making it easy to change or cancel reservations, with self-service options online and automated voucher issuance. Compared to calling in and sitting on hold for hours, it’s easy to understand why customers settle for these offers. Frontier Airlines previously offered a limited-time waiver policy that incentivized passengers with an extra $50 credit if they voluntarily canceled an itinerary for travel between March 22 and June 17.

This strategy has also become popular in the cruise industry- Cruise lines are offering incentives to passengers to get them to accept travel credits instead of cash refunds, airlines are copying a strategy that has become widespread in the cruise industry. Most major cruise lines in recent weeks have begun offering passengers on canceled sailings a bonus credit of 15% to 25% if they choose a credit instead of a cash refund.

On Royal Caribbean, for instance, passengers on canceled trips can choose between a full refund or a future cruise credit in the amount of 125% of the fare paid for the canceled trip. The credit can be applied to any voyage through Dec. 31, 2021. Royal Caribbean has canceled all departures worldwide through April 10, as have all other major cruise lines. Some lines have canceled sailings even further out.

Other cruise lines offering a 25% bonus credit to passengers who forgo a cash refund include Celebrity Cruises, Crystal Cruises, Norwegian Cruise Line, Oceania Cruises, Seabourn, Silversea, Viking, Windstar and Regent Seven Seas Cruises. River line AmaWaterways is offering a 15% bonus. Greek Islands cruise specialist Celestyal Cruises is giving out a 20% bonus.

What if you booked through a third party agency? – If  you booked through an online travel agency such as Expedia or Priceline, your first point of contact should be the agency. They will process your refund since they were the company who collected your original payment. There are a few exceptions – particularly with air travel-  if your flights is operated by a low-cost carrier, the travel agent will redirect you. If your flight qualifies for reimbursement but a refund isn’t offered, customers have another option. The federal Fair Credit Billing Act gives you the right to dispute a charge for services not provided if you purchased the airfare with a credit card. Typically you’re required to make a good-faith effort to resolve a problem directly with the merchant first. Be sure to call the airline before initiating a chargeback and document your efforts.

Overall –Couple main takeaway points – It’s nice to see that at least some airlines are providing an incentive for taking a travel credit instead of refund. However, keep in mind that if you do take an airline up one one of these offers and your new flight gets canceled, the airline will not provide a cash refund down the line. – It’s also important to take note of when your travel credit will expire as ticket credits are often only valid for a year from the date that the ticket was originally issued.