Flyer Beware: Be Careful Buying Airline Tickets In The Pandemic - Forbes

Consumers have long been familiar with the saying caveat emptor, "let the buyer beware," an ominous warning of how consumers can sometimes get screwed. This has increasingly been an issue with air travel, prompting the newer notion of "let the flyer beware." Complaints regarding refunds and trip cancellations have skyrocketed to record highs during the ongoing, evolving and constantly changing COVID-19 pandemic.

The Department of Transportation recently reported that in the 18 months from January 2020 through mid-2021, a staggering 84% of all consumer complaints regarding air travel were about refunds. That is a more than a tenfold increase from life before the pandemic, when only about 8% of these complaints were refund related. According to USA Today, there are hundreds of thousands of consumers still trying to collect refunds from flights cancelled in 2020, totaling an outstanding $10 billion. That's real money.

In the current environment there are two very different issues at play for ticket buyers. One is the increasing number of flight cancellations - recently in the thousands - where you simply cannot get where you want to go. The longer-term issue throughout the pandemic has been consumers choosing not to go on a planned trip because of health concerns, changing rules or other reasons.

If your flight is cancelled by the airline, as just happened with thousands of holiday flights short staffed due to the fast-spreading omicron variant of COVID-19, you are entitled to a refund. That is pretty straightforward, though there may be substantial delays actually collecting it. But when your flight is cancelled you also have the option of rescheduling (if there are alternate flights available) and if you still want to go, even at later dates, you may be better off doing this, because usually the airlines will do that at no additional cost, even if the new flights are pricier, whereas getting your money back and rebooking will be a losing proposition if fares go up.

What is not so straightforward is when you decide not to travel - whether or not you have a choice. One major reason for this situation is testing positive for COVID-19 pre-departure, and testing is a requirement for just about all international flights. However, while you will be denied boarding, it is not the airline's fault if you get sick. Likewise, changing rules may forbid you from entering other countries altogether, but airlines don't make these rules, and as long as the carrier still operates the scheduled flight, they can refuse your refund. The Washington Post recently reported the case of a consumer who canceled a trip to the UK when the government there imposed a new lockdown, but since her carrier, American Airlines, still operated the flight, they refused a cash refund.

Earlier in the pandemic, when travel first slowly resumed from virtually no one flying, many airlines had generous guarantees of no questions asked cash refund guarantees for would-be buyers, but these have almost entirely vanished. Instead, most carriers are now offering enhanced flexibility in terms of fee-free changes and/or extended future rollover of tickets or refunds in the form of credits for future travel. If you fly a lot, getting future credit may be as good cash back, because you know you are going to use it anyway, but that is not the case for many infrequent leisure travelers. There is no one great solution to the refund issue, but there are a couple of alternatives. One is flight insurance, which is now being offered with just about every airline ticket you buy online.

I normally do not advocate getting trip insurance, because in the long run, like all insurance, it is designed to be a losing proposition. Simply put, insurers charge more than they expect to pay out. In addition, the one thing even worse than paying for travel insurance you don't need is paying for travel insurance you do need and then finding out that your situation is not covered. However, these are strange times and between peace of mind and the increased likelihood of you having to (or wanting to) cancel your trip, the insurance my be warranted. But travel insurance is far from clearcut, and many "flight insurance" plans will not cover cancellation due to your concerns about the general state of the world, and even for health, only cover you in the event of documented medical necessity, which may or may not include a positive COVID test with no treatment or hospitalization. When it comes to insurance, it is vital to read the fine print and make sure that your concerns, including voluntary cancellation, are actually covered. In addition to flight insurance there are comprehensive travel insurance plans which cover all the components of your trip.

According to popular website Insuremytrip.com, which is an online clearing house of policies from various insurers (and with whom I have no personal experience), if you want maximum flexibility, you need to look for "Cancel for Any Reason (CFAR) coverage. "With CFAR, it doesn't matter why you have to cancel your trip - you just can. Often times, travelers will purchase CFAR coverage when traveling to a part of the world with civil or political unrest. This allows the traveler to cancel if uncomfortable with leaving for the trip - second thoughts, fear of safety or a bad omen appeared. Regardless the reason if you are outside 48 hours before your trip, you can cancel."

There are a couple of other special circumstances that also point towards buying comprehensive trip insurance. One is where your travel is very time sensitive and cancelled flights lead to other pre-paid high costs, such as missing a cruise departure or villa rental. Another would be if your intended travel involves an unusual carrier you are not likely to be flying again, such as a Pacific Rim airline, which if cancelled you cannot readily re-use the credit like you would on a domestic airline.

The other alternative is to be selective who you fly and seek out airlines offering more flexible special policies during COVID-19. Not surprisingly, the best airlines typically offer the best customer service practices - and vice versa - and I recently wrote here at Forbes about why I only recommend using 4 and 5-Star rated carriers. Currently the best peace of mind I could find in the entire industry is from Qatar Airways, which makes sense given that they are frequently rated the world's best carrier. Earlier this year I bought my wife and I tickets to Africa, knowing that we might well end up not going. I chose Qatar for its quality and routing, but also because they had an unconditional, no strings attached refund policy for any cancellation for any reason. This sounded too good to be true, and I've spent a lot of time in my life fighting with airlines, so I took and saved screen shots of the guarantees in the expectation that there would be a hassle down the road and the website would change. But when I cancelled my tickets, the agent (an actual person who answered quickly and without a tedious hold period) was extremely friendly, didn't make any effort to dissuade, upsell or change me, and my credit card was reimbursed the next day. Maybe that's why they are the top-rated carrier.

In any event, I just took another look at the Qatar site and they currently offer a variety of special COVID-19 policies for new ticket purchases including refunds ("Get the unused value of your ticket refunded through your original form of payment, with no penalties or refund fees") as well as the option to exchange your ticket for a future travel voucher worth 10% more than you originally paid - a bounty I've found no place else - with other options such as unlimited changes, including dates and destinations, with no fees, and extended validity, so you can sit on your ticket for up to two years. That's flexibility.

Cathay Pacific, a similarly top ranked carrier known as one of the world's best, is the only other major airline I found (unfortunately many airlines' sites are not clear on these policies) offering straight up refunds for those who "no longer want to travel at all," as well as fee-free changes and the option of converting tickets to future credits.

Unfortunately, very few carriers are matching Qatar and Cathay in terms of openly offering refunds (when they don't have to). A list of policies by carrier is offered at website Travelperk.com, though this information is constantly changing and should be double checked.

Turkish Airlines, the carrier flying to more destinations than any other airline in the world, and another of the very best, added similarly generous flexibility without the pure refund option. They offer unlimited changes in destinations and dates or the opportunity to convert the ticket to an open ticket for future use.

Most common is the elimination of change fees and extended rebooking periods on many major carriers. United recently announced Coronavirus travel updates, including the elimination of change fees for economy and premium travel within the U.S., Mexico and the Caribbean as well as all international travel originating in the U.S. This applies to tickets purchased through the end of January 2022. American Airlines did the same, dropping all change fees for domestic, short haul international and "select" long haul international flights.

It is very important to note that on many carriers, this flexibility does not apply to the more recently introduced, horrific and misleading "basic economy," which is not "basic" at all and includes none of the basic components of travel that passengers have enjoyed for decades but is more of a special no-frills steerage class. Some airlines use alternative names like Economy Lite.

In any case, when you buy tickets in the current environment of uncertainty based on the promise of COVID-related flexibility, double check the purchase dates that temporary COVID-19 policies apply to, and I strongly advise taking and saving a screenshot of the guarantees on the carrier's website.

There is one useful loophole to bear in mind, especially when buying tickets that are further out in time. More than ever, airlines are changing flight schedules, and for several flights I booked for first quarter of 2022, I have already received notices of often minor changes in flight times or layovers.  Generally, these are not a big deal, but they do give you the option of not accepting the changes and getting your money back, since the travel you paid for no longer exists. There is no guarantee that the flight you decide you no longer want will change, but if it does, you are in luck.

One more thing to remember during this frenetic and stressful travel time: If your flight is substantially delayed or cancelled last minute, many airlines now will automatically rebook you and inform you of the new itinerary by text or email. Remember that you don't have to accept this, and you should check other alternatives. Your best interest is to get where you are going as painlessly and as close to on time as possible, but the airlines' best interest is to give you the least desirable and expensive seat rather than one they can sell someone else for more money. In my experience, the new proposed routing is often not the ideal alternative.

Travel safe!