If I have to cancel a non-refundable flight or accommodation, can I get my money back?
If you read the terms and conditions of your pre-paid flight or accommodation service, you'll find that in many cases they don't offer refunds at all. That being said, what if your forced to make a cancellation?
With travel insurance it's possible to get a refund
Travel insurance can reimburse you for lost deposits and cancellation fees you as long as:
- The cancellation is for reasons outside your control
- You have first attempted to obtain reimbursement from the airline or accommodation provider
- Your insurance policy was bought before the cancellation (or before you were reasonably aware you would have to cancel)
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If you’re forced to cancel your flights, follow these steps
If you’re forced to cancel your flight due to circumstances beyond your control, there are three main steps involved in making a claim on your travel insurance:
- Gather documentation to support your claim. This might include a doctor’s report describing your illness or injury or any other written evidence of why you were forced to cancel your flight.
- Approach the airline for a refund. The percentage refunded from the airline will depend on the type of ticket purchased and how far out from the departure date you cancel.
- Claim through your travel insurance. Put in a claim for whatever amount the carrier will not refund, up to the policy’s benefit limit.
Can I get a refund directly from my airline or provider?
It may be easier to approach your airline for a refund. In cases where you can't get a full refund for the airfare, the airline may refund you for any taxes paid.
A refund for the cost of a cancelled flight will depend on the type of ticket you’ve purchased. Many of the cheaper economy or saver fares are non-refundable, although you may be able to change the date of your flight for a fee. Take Tiger Airways for example:
*Tigerair operates a no refund policy and as such it is unable to refund any tickets (fares and charges) where the passenger decides they no longer have a requirement to fly or is unable to travel, as a result of any change in personal circumstances, including but not limited to medical grounds. Individual or Personal Travel Insurance is recommended for all passengers to cover such cancellations.
Cancellation fees charged by airlines are also date-dependent. In other words, if you cancel three months out from your flight, you may be charged a cancellation fee of 25% of your fare. Whilst if you cancel on the day of departure, you'll probably be charged 100% of your fare.
Why you must be careful if you buy from a low-cost or budget airline
If you purchase an economy or saver fare from a budget airline, be aware that the ticket is cheap because it's usually non-flexible. Major exclusions for these types of tickets include
- No refunds for cancellations under any circumstances
- No name changes under any circumstances
- No date changes
If you do manage to get your flight for a song, make sure you read the lyrics (the fine print). If the fare is non-refundable, even in the case of illness or injury or upgraded travel warnings, make sure you have travel insurance to cover your losses if the unforeseeable happens.
Why you must be careful with flights bought on aggregators
As with budget airlines, flight aggregators also advertise cheap airfares. Unlike flight consolidators, who buy bulk tickets and sell them cheaply online, flight aggregators search the internet for the lowest fares and make their commission when a booking is made with an airline via their website. The online market is highly competitive, with more travel agents now becoming online aggregators to cash in on the demand (Flight Centre is a recent example).
Responsibility for processing refunds is a grey area
As these cheap fares are being offered by budget airlines, the same restrictions apply to their use, often including no refunds for cancellations. A flight aggregator will distance itself from any terms and conditions and will refer you to the airline in question for any queries regarding refunds. Similarly, the airline's customer service may refer you back to the aggregator or travel agent.
If you plan to buy cheap airfares, either be prepared to lose 100% of your money if you have to cancel for any reason or take out travel insurance to cover your potential losses.
Can travel insurance cover me for non-refundable accommodation?
Travel insurance can also provide cover for non-refundable accommodation expenses. As with flights, your policy will only pay the portion of the cost not recoverable from the accommodation provider.
Recovering costs from the accommodation provider
If you booked your accommodation through an accommodation aggregator such as Hostelworld or Bookings.com, they will usually refer you to the accommodation provider for any cancellation queries. It may be worth contacting the hotel directly and explaining your situation, as you may (depending on how far out you are cancelling) still be able to get a partial refund.
If the hotel refuses a refund, you may still be allowed to change the date of your booking for a small fee.
When won't travel insurance reimburse me?
Travel insurance will reimburse you if the cancellation is due to unforeseen circumstances and not due to:
- You changing your mind
- Your financial circumstances changing
- Your travel agent’s failure to provide service
- An action by your carrier that you were warned about prior to purchasing travel insurance
- A government regulation or prohibition
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*finder.com.au is in no way associated with Tiger Airways. The quoted paragraph from Tiger Airway's refund policy is purely for demonstrative purposes. Information is accurate as of 28 January 2016.
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