Bill Overview
Title: Cash Refunds for Flight Cancellations Act of 2022
Description: This bill requires air carriers and ticket agents to offer full cash refunds for airline tickets if (1) an airline cancels or significantly delays a flight, or (2) a passenger cancels their ticket for a flight up until 48 hours of the scheduled departure time. The bill permits air carriers and tickets agents to offer alternative forms of compensation, including credit, or vouchers, provided that such offer is valid indefinitely and the offer includes a clear and conspicuous notice of the passenger's right to a cash refund. Additionally, the bill requires air carriers and ticket agents to disclose to passengers, prior to the sale of airline tickets, that they can cancel their tickets and receive a full refund.
Sponsors: Sen. Markey, Edward J. [D-MA]
Target Audience
Population: People who travel by air worldwide
Estimated Size: 300000000
- The bill affects air travelers, who would benefit from the provided financial security against cancellations and significant delays.
- In 2019, approximately 4.5 billion air passengers were estimated globally. Given this large number, the legislation affects a significant portion of the global population, particularly frequent travelers and consumers of airline services.
- The legislation primarily targets consumers who spend significant money on air travel, which includes business travelers, tourists, and travelers in areas with high air traffic.
- Each year, the US experiences around 926 million passenger enplanements on domestic and international flights that could be impacted by the legislation.
- Frequent travelers and those residing in or regularly traveling to/from major air traffic hubs are particularly impacted.
Reasoning
- The Cash Refunds for Flight Cancellations Act targets air travelers, particularly those affected by cancellations and significant delays.
- Business travelers and frequent flyers will likely have a more pronounced benefit due to their frequent interactions with airline services.
- Leisure travelers may benefit as well, especially those who book non-refundable tickets or travel during times when flights are often delayed or canceled due to weather.
- People who use budget airlines may find substantial relief, as these carriers often have less flexible refund policies.
- Some individuals, such as those less frequently flying or relying on non-air-based travel modes, will not be significantly impacted.
- The policy's budgetary limits necessitate careful consideration of the scale and frequency of compensation requests, especially in the face of widespread cancellations during peak travel times.
Simulated Interviews
Consultant (New York, NY)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 12/20
Statement of Opinion:
- I appreciate the security this policy provides for my frequent travels.
- In cancellations, a cash refund would be more useful than mere credits as my travel needs are diverse.
- The policy supports my professional needs by reducing the financial risks involved in complex travel plans.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 6 |
Tour Guide (Chicago, IL)
Age: 32 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 15/20
Statement of Opinion:
- This policy is beneficial for me as I often face client cancellations.
- Having the ability to refund a flight can help reduce administrative complications on busy tour schedules.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Retired (Miami, FL)
Age: 50 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 2.0 years
Commonness: 8/20
Statement of Opinion:
- While I do not travel frequently, the assurance of refunds encourages me to plan more trips.
- Having a policy like this reduces my anxiety about potential losses from cancellations, especially after retirement.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 6 |
Graduate Student (Los Angeles, CA)
Age: 28 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 1.0 years
Commonness: 9/20
Statement of Opinion:
- The policy is potentially useful since airline credits don't meet my needs on a tight budget.
- Having a cash option gives more flexibility and confidence to attend important events.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Retired Airline Pilot (Houston, TX)
Age: 60 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 5/20
Statement of Opinion:
- The policy holds little relevance to my current lifestyle.
- However, it seems a fair measure for regular travelers like my former colleagues.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Software Developer (Seattle, WA)
Age: 24 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- Finally, a policy that provides cash refunds seems fair for low-budget flyers.
- Credit offers have been limiting in the past, so this ensures better planning.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 5 |
Food Critic (San Francisco, CA)
Age: 37 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 7.0 years
Commonness: 7/20
Statement of Opinion:
- As someone whose job involves traveling, refunds are crucial in maintaining financial fluidity.
- Policy advantages are more practical than a credit system, enhancing my professional agility.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 9 | 7 |
| Year 3 | 9 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 6 |
High School Student (Boston, MA)
Age: 17 | Gender: male
Wellbeing Before Policy: 9
Duration of Impact: 1.0 years
Commonness: 6/20
Statement of Opinion:
- While I appreciate the idea behind the policy, it impacts my parents more than me.
- Ensuring that refunds are possible might encourage more family trips in the future.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 9 |
| Year 2 | 9 | 9 |
| Year 3 | 9 | 9 |
| Year 5 | 9 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Marketing Executive (Atlanta, GA)
Age: 53 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 11/20
Statement of Opinion:
- I've had issues with flight changes impacting my business travel.
- Having guaranteed cash refunds for cancellations saves both time and money.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 8 |
| Year 2 | 9 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 7 |
Teacher (Denver, CO)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 13/20
Statement of Opinion:
- With limited travel windows, knowing I can cancel without losing money is a relief.
- Cash refunds are preferable given our family budget priorities.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 7 | 6 |
Cost Estimates
Year 1: $1000000000 (Low: $800000000, High: $1200000000)
Year 2: $950000000 (Low: $750000000, High: $1150000000)
Year 3: $900000000 (Low: $700000000, High: $1100000000)
Year 5: $850000000 (Low: $650000000, High: $1050000000)
Year 10: $800000000 (Low: $600000000, High: $1000000000)
Year 100: $500000000 (Low: $300000000, High: $700000000)
Key Considerations
- The refund policy is indefinite, putting continuous long-term pressure on airline cash flows.
- Airlines might need to establish buffer reserves to accommodate potential surges in refunds, especially during economic downturns.
- Consumer behavior in booking patterns may change with the increased flexibility and security of refunds.