Refundable vs. Nonrefundable Plane Tickets: Key Differences Explained

Are plane tickets refundable? Here’s what you need to know.

According to the U.S. Travel Association, air travel demand was up 12 percent in July 2023 compared to July 2022. If you’re among the many travelers flying this year, understanding when you’re eligible for a refund upon changing or canceling your plane ticket is crucial. I had the opportunity to speak with Stella Shon, an expert in travel and personal finance, to delve into the air travel rules and regulations, ensuring you’re informed about obtaining a flight ticket refund. Here’s everything you need to know about refundable and nonrefundable plane tickets, and how to get a credit even if you opt for a nonrefundable fare.

Understanding Refundable and Nonrefundable Tickets

Purchasing a nonrefundable plane ticket means that if you cancel your trip, you are not entitled to a cash refund of the full fare of your ticket. On the contrary, a refundable plane ticket permits you to cancel your airfare and receive a refund to your method of payment. Nevertheless, if the airline cancels your flight, you are entitled to a refund, regardless of the ticket type you purchased.

“Interestingly, the post-pandemic world has introduced some favorable changes if you’re looking to alter or cancel your flight,” says Shon. “Pre-COVID, you had to pay a pesky change or cancellation fee that could reach over $200. Now, major U.S. airlines allow you to modify your flight for free, with a fare difference applicable, as long as you don’t book basic economy.”

Refundable tickets can be significantly more expensive, often costing hundreds more for the same flight. “100% refundable tickets no longer offer substantial value to travelers, as you typically receive a voucher from the airline that can often be used for up to a year,” explains Shon. “Unless your travel plans are exceptionally uncertain, you’re usually better off booking a nonrefundable ticket that provides modification options, ensuring you still receive a voucher.”

The 24-Hour Refund Rule Explained

The U.S. Department of Transportation has instituted regulations to protect travelers. Provided you book your plane ticket at least seven days before the scheduled departure, airlines are obliged to either allow travelers to cancel their reservation and receive a full refund within 24 hours from the booking time or enable travelers to place a hold on the fare without payment for the ticket for 24 hours. It’s vital to note that airlines do not have to provide both a refund and a hold option, so understanding which option is available before purchasing is essential.

This 24-hour rule does not apply if you purchase your ticket through a travel agency or third-party platform – it is enforced solely with direct airline bookings. Nevertheless, many platforms offer similar procedures.

How to Change or Cancel a Nonrefundable Flight

Changing a nonrefundable flight ticket is straightforward. Simply access your booking and select your new flight (most airlines facilitate this process easily via their website or app). As mentioned earlier, as long as you aren’t flying basic economy, most major carriers have waived change fees, only charging a fare difference if necessary.

If you need to cancel a nonrefundable flight ticket, your eligibility for a refund will often depend on how you made your reservation. If you used miles for your flight, canceling is usually a simpler process, allowing those miles to be redeposited into your account. Conversely, if you paid for your ticket, you may still receive a voucher for future travel, excluding any applicable cancellation fees. Generally, it is uncommon to be unable to obtain any form of travel credit for a canceled trip, as long as you cancel well in advance.

Travel Insurance for Flight Changes

When booking a plane ticket on most major carriers, you will likely see an option to add travel insurance to your reservation through third parties, like Allianz Global Assistance. This insurance offers coverage for cancellation or interruption of your trip, along with expenses arising from travel delays.

“If your vacation is disrupted by illness, family emergencies, or other circumstances, you can file a claim under your travel insurance to receive reimbursement for nonrefundable expenses, including flight costs, hotel accommodations, and other travel-related expenditures,” states Shon. “Just be prepared to provide documentation supporting your claim.”

Typically, adding travel insurance is much more cost-effective than booking a refundable plane ticket, providing similar cancellation coverage if the reason for canceling is valid. However, travel insurance will not cover claims simply due to a change of heart about the trip.

Credit Card Coverage for Cancellations

Numerous credit cards offer a variety of coverage options while traveling. According to Shon, “The best credit card options come from the Chase Sapphire suite. Both the Chase Sapphire Preferred ($95 annual fee) and the Chase Sapphire Reserve ($550 annual fee) provide an array of benefits for travelers in emergencies, including cancellation and interruption insurance, reimbursement for lost or delayed luggage, and primary rental car insurance.” She further mentions, “The higher-priced Chase Sapphire Reserve card may justify its cost for offering complimentary emergency evacuation, transportation, along with medical and dental coverage.”

Additionally, if you book your flight through a credit card travel portal, such as Capital One Travel, you may have the option to add cancellation coverage at the time of checkout. Booking through this platform may allow you to pay an extra fee to cancel your flight for any reason, up to three hours before departure. You could be eligible for either a partial cash refund or a complete airline travel credit equal to the ticket’s value.