If you're trying to get a refund for a canceled trip, prepare for an unpleasant surprise. Although some airlines, cruise lines and hotels have offered customers their money back amid a wave of coronavirus cancellations, others haven't.
They include airlines that are openly defying the government's refund rules, tour operators pocketing hefty cancellation fees, and cruise lines demanding three months or more to refund the price of a ticket.
The travel industry is desperate. Tightening refund policies might stem the losses — or postpone going out of business.
Here are typical industry policies:
• Most airlines are offering a full refund when they cancel a flight, but they're pressuring customers to accept a ticket credit.
• Cruise lines are still giving refunds. They're also encouraging customers to accept a credit by offering extra incentives, such as raising the value of their vouchers.
• Hotel chains are allowing refunds for rooms until late spring.
Colorado-based tour operator Voyageurs International has a refund policy that has drawn complaints.
Jim Dachel's daughter, Elizabeth, was looking forward to a 16-day high school trip to Europe in June. The tour operator canceled her trip, refunding $4,445 after charging a $1,900 cancellation fee. A representative told Dachel that the company needed to cover its expenses and pointed out a clause in the contract that allowed it to charge the fee. "I believe this cancellation fee is about profiteering," says Dachel, of Colfax, Wis.
John Flanders, an attorney for Voyageurs International, says the tour operator isn't trying to profit. "Right now, we're just trying to keep this business afloat," he says.
Vacations are all being canceled at the same time, placing an enormous strain on the industry. Many companies, especially small ones, don't have the cash on hand to give refunds for all the canceled trips at one time.
"The entire system is conserving cash right now," says Eric Martin, owner of Wilderness Voyageurs, a tour operator based in Ohiopyle, Pa. "So everyone is issuing credits.
"No one is intentionally instituting policies to [harm] their customers," Martin adds. "We will need them once this is over."
There's a way to deal with these policies. First, review the terms of purchase. Often, the refund rules are unambiguous. If you can live with a credit, it's worth considering. Martin is correct: Many travel companies won't survive if everyone, all at once, asks for their money back.
Fortunately, these refund policies shouldn't be with us for long. Experts predict that when the coronavirus crisis abates, businesses will return to customer-friendlier policies. Assuming the companies survive, of course.