One positive development we have seen in the airline industry as a result of the coronavirus pandemic is the abolition of change fees on most types of tickets. Not only have airlines temporarily waived change fees, but major carriers have eliminated change fees “permanently” (whatever that means, because nothing in life is permanent).
United Airlines was the first major US airline to announce that it would permanently eliminate change fees during the pandemic, but the carrier’s policy went from huge to not very competitive within hours. That has finally changed.
United now issues the remaining evidence for changes
The way the policy does not apply to any change costs is that if you book an eligible ticket and no longer want to travel, you can cancel your itinerary and then apply the value of the ticket to future travel. To be clear, tickets do not become fully refundable to the original payment method, but rather you get a proof of purchase for a future ticket.
But until recently, there was another big catch with United’s policy – if you rebooked your itinerary and your new flight cost less than the original food, you lost the price difference. This was in contrast to the policies at American and Delta, which issue vouchers when you change tickets.
To give just one example, say you booked a $ 500 ticket, canceled it and then wanted to use your credit for a $ 200 flight:
- At United you can use the credit for the flight, but you will “lose” $ 300 in value
- At American and Delta you can use the credit for the flight, and then you will receive an additional voucher of $ 300 for future use
Well, United Airlines has finally updated its policy in this regard – United Airlines will now issue a voucher if the itinerary you are booking costs less than your original itinerary. There are a few things to note:
- This feature is only available if you book directly with United, and is initially only available via United’s app and by phone
- The proof of purchase is valid for one year from the original issue date and is not transferable
This is great news. United took the lead when it first announced plans to eliminate change fees, and ultimately consumers were still ahead compared to the old policy, even if they lost residual value. As other airlines introduced a broader policy, United was quickly quite uncompetitive.
You now maintain the residual value on United vouchers when you change flights
An interesting twist in the travel agent
Brett Snyder makes an interesting remark regarding United’s new change cost policy. You have only issued a voucher if you book directly via United, and not if you book through a travel agent (travel agents can change tickets without payment, but cannot issue the vouchers).
What happens when you book with a travel agent? Well, all non-basic United tickets booked by travel agents are refunded at a fee. The fee ranges from $ 100 to $ 400, depending on the rate type:
This is potentially important and for some people it can be an incentive to book through a travel agent. To be clear, we’re talking about tickets being legally refundable, in the sense that it’s money that will be refunded to your credit card, rather than a proof of purchase for a future ticket.
Why is it useful? For example, say you’re a business traveler booking a $ 5,000 business class ticket that is non-refundable. I’m sure many people would rather pay $ 400 to get cash in their pocket, rather than a United voucher for a future flight.
This is a very interesting angle, as it makes virtually all United rates refundable to the original currency for a fee, rather than just changing them for free.
Now I must mention that I still have no first hand experience with the implementation of this. In other words, I’m not 100% sure if this applies in the same way to online travel agencies, and if so, what the refund process would look like.
Most United tickets booked by travel agents are refunded for a fee
Bottom line
United Airlines has improved its policy for no change fees. If you cancel a ticket and book on a cheaper flight, you will receive a proof of purchase for the fare difference, which was not the case before. This is an amazing development, and ultimately it was necessary, as the US and Delta have had this generous policy throughout.
What I find equally interesting is that tickets booked by travel agents are eligible for cash refund at a fee. For those willing to pay to get cash back instead of a voucher for future travel, this may be a reason to book with a travel agent.
What do you make of United’s adjustments to the policy for no change costs?