Cancel Your Plane Ticket Or Pay The Change Fee?

by Steve Dasseos, The Trip Insurance Guru on September 9, 2011

Have you ever wondered what happens to your plane tickets if you have to cancel your trip for a covered reason and file a claim on your trip cancellation travel insurance plan?

Do you:

  1. Cancel your flight and get no refund from the airline? (this means you claim the full cost of the plane tickets on your claim) or
  2. Pay the change fee and use the credit by your airline’s deadline? (this means you keep a credit equal to the value of the non-transferable plane tickets and just file a claim for the change fee)

To me, there’s no question which choice I’d make. I always take money back versus having a credit. But, that’s just me. Surprisingly, many people who file travel insurance claims choose to keep the credit for the value of their plane tickets and file a claim for the change fee.

How do you know what your trip cancellation travel insurance plan will do? All six of my pre-screened companies will reimburse you if you insured your full prepaid and non-refundable trip cost, and are cancelling your trip for a covered reason. As for the hundreds of other policies out there, the only way to know for sure is to read the policy wording.

And, not all airlines have change fees. There’s something important called a “Contract of Carriage”. You probably never read it, but it’s worth reading. An airline contract of carriage is a contract between a carrier of passengers and the passenger. Contracts of carriage typically define the rights, duties and liabilities of parties to the contract, addressing topics such as acts of God and including clauses such as force majeure.

If you read the “Contract of Carriage”, you’ll find out your options if you don’t take your trip.

Imagine this conversation with the airline:

You: I have to cancel my trip so I need to cancel my plane ticket.
Airline: Ok, no problem. It’s done and you won’t be getting any refund.
You: Wow, that was easy. Bye.

The airline then resells your seat for a big profit. And your trip cancellation travel insurance plan gives you back the money you lost. Everyone’s happy, right?

Not everyone. Sometimes the conversation is more like this:

You: I have to cancel my trip so I need to cancel my plane ticket.
Airline: Ok, no problem. You just pay a minimal change fee and you can re-use the value of your ticket within 12 months. If you book a more expensive ticket you simply pay the difference.
You: If I book a less expensive ticket will I get a refund for the difference?
Airline: No
You: I want to cancel my ticket.
Airline: You won’t be getting any refund.
You: That’s OK
Airline: Most people pay the change fee.
You: I don’t want to. I just want to cancel.
Etcetera, etcetera, etcetera (just like Yul Brenner in The King of Siam), back and forth until you give.

Therefore, before you call the airline, read the “Contract of Carriage” so you’ll know what your options are. Better yet, read the “Contract of Carriage”, when you are booking your ticket. Or, if you have a ticket now, get it out and read it.

So, what should you do? Read this: Should You Buy Trip Cancellation Insurance For Just Airfare?.

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