For millions of air passengers, the fine print of airline policies can matter as much as the flight schedule itself. In the last two years, regulators in the United States, Europe and the United Kingdom have pushed through new rules on refunds, fees and passenger rights, even as industry lobbying has led to rollbacks in other areas. As the 2026 travel season begins, understanding ten core policy areas can make the difference between a smooth journey and an expensive, time consuming dispute.
Refund Rights When Flights Are Canceled or Significantly Changed
The most consequential recent change for U.S. travelers concerns cash refunds when flights are canceled or significantly altered. In April 2024, the U.S. Department of Transportation issued a final rule requiring airlines and ticket agents to provide automatic refunds when a passenger is entitled to one and does not accept rebooking or vouchers instead. The rule applies to flights to, from or within the United States, including those operated by foreign carriers, and it obliges airlines to define and respect what constitutes a “significant” schedule change.
Under the rule, passengers are entitled to a refund if a flight is canceled and they either are not rebooked or decline the rebooking, as well as when the airline makes a significant change to departure or arrival times, connections or airports and the traveler chooses not to proceed. Refunds must be paid back to the original form of payment, in cash or equivalent, not as default travel credits, and the vouchers airlines offer as an alternative must be valid for at least five years. For passengers who struggled during the pandemic to recover money for trips they never took, this automatic process aims to remove the burden of navigating complex online forms or call centers simply to receive what they are owed.
Timing also matters. Airlines now have seven business days to issue refunds for credit card purchases and 20 calendar days for other payment methods. Consumer advocates say this has sharply reduced long refund delays that were common earlier in the decade, when some travelers waited months. System glitches and surges in disruption can still slow processing in practice, so officials urge passengers to keep documentation and follow up promptly if the statutory deadlines are missed.
Why Cash Compensation Is Off the Table for Most U.S. Delays
While refund rights have been strengthened, efforts to secure mandatory cash compensation for long delays have largely stalled in the United States. After promising European style payouts for airline controlled disruptions, the Biden administration advanced a proposal that would have required carriers to pay passengers for lengthy delays caused by issues such as staffing shortages or mechanical problems. Draft versions discussed compensation tiers up to several hundred dollars depending on the length of delay.
That initiative has since been set aside. In August 2025, the Transportation Department formally withdrew the proposed cash compensation rule amid intense industry pressure and a broader deregulatory push in Washington. Airlines argued that mandatory payouts would increase costs, reduce their ability to recover from operational disruptions and ultimately drive up fares. The reversal effectively created a two track system for U.S. travelers: robust rights to refunds when flights are canceled or significantly changed, but no guaranteed cash for simply arriving late, even if the cause lies within the airline’s control.
As a result, passengers seeking compensation for delays must still rely on airline specific policies, frequent flyer goodwill gestures, credit card travel protections or optional travel insurance. Some major U.S. carriers have voluntarily adopted more generous refund practices than the minimum rule requires, offering refunds for certain long delays rather than just cancellations, but these programs are voluntary and may be changed or withdrawn. Travelers are advised to check each carrier’s “customer commitments” and to document when delay announcements begin and end if they intend to pursue compensation.
How Weather, Recalls and Other “Extraordinary Circumstances” Limit Help
Another key policy area is what happens when disruptions are genuinely beyond an airline’s control. In guidance issued after a spate of aircraft inspections and recalls, U.S. regulators clarified that when cancellations or delays stem from manufacturer directed safety actions, airlines are not required to pay for meals, hotels or other incidental expenses, even if passenger itineraries are badly disrupted. They must still provide refunds when flights are canceled and the passenger chooses not to travel, but out of pocket costs during the disruption are generally not reimbursed as a matter of right.
This position aligns with the long standing concept of “extraordinary circumstances” in European law, where events such as severe weather, air traffic control strikes or security incidents can relieve airlines of the obligation to pay compensation for delays and cancellations, although they must still offer rerouting and care. The debate today is less about whether truly external events should count, and more about where the line is drawn. Consumer groups in Europe, for example, have criticized efforts to expand the category in ways they say could exclude more disruptions from compensation.
For travelers, the distinction is more practical than legal: if a cancellation is due to a reason considered outside the airline’s control, mandatory compensation is limited, and assistance may come only in the form of rebooking or refunds. That makes personal travel insurance and credit cards with trip interruption benefits increasingly important for those who cannot easily absorb the cost of overnight stays or alternative transport when major storms or technical directives ground flights across a region.
Family Seating and the Fight Against “Junk Fees”
Seat selection fees have been a flashpoint in the broader battle over so called junk fees, and nowhere more so than in the case of families traveling with young children. After years of complaints from parents who either paid premium prices or relied on ad hoc gate area negotiations to sit next to their children, the U.S. Transportation Department proposed a rule in 2024 that would ban extra charges for seating parents with children aged 13 and under when adjacent seats are available at booking.
The measure, backed by the White House as part of a wider campaign against last minute mandatory add ons, would require airlines either to seat families together without extra fees or, if that is not possible, to offer a refund or free rebooking. Several major carriers had already begun allowing fee free family seating on a voluntary basis under federal pressure, but the proposed regulation would standardize the practice across the industry and attach potential penalties for violations.
The rule has not yet taken full legal effect and faces industry scrutiny, particularly over operational scenarios in which aircraft changes or tight load factors complicate seating assignments. In the meantime, airlines typically state that they will “make best efforts” to seat families together at no extra cost, and many encourage parents to call customer service ahead of travel. Advocates recommend booking as early as possible, checking in promptly when online check in opens, and contacting airline agents at the airport if automated systems scatter the family around the cabin.
Seat Selection, Boarding Groups and New Approaches to Assignments
Beyond families, airlines continue to refine seat assignment and boarding policies in ways that can affect both cost and comfort. A clear example is Southwest Airlines, which for decades operated on an open seating model with passengers choosing any available seat once onboard. In a significant shift, the carrier announced it will introduce assigned seating in January 2026, allowing customers to select seats during booking and aligning its approach more closely with network competitors.
The move is part of a broader push by airlines to monetize seat choice through tiered products ranging from basic economy, which often restricts or charges for seat selection, to extra legroom and premium economy sections with higher fees. Travelers who do not pay may still receive an assigned seat at check in, but may find themselves in middle seats or separated from companions. Boarding group policies, which dictate when passengers can access overhead bin space, are also increasingly tied to fare class and loyalty status.
The policy lesson for passengers is that “base fare” rarely tells the whole story. Understanding how each airline handles standard seat selection, preferred seating zones and early boarding can help travelers compare the true cost of competing itineraries. It also underscores why regulators in both the United States and Europe have sought to force earlier, clearer disclosure of ancillary fees during the booking process, rather than allowing them to appear only at the final payment page.
Changing Rules on Passenger Rights in Europe and the UK
Travelers flying within or from Europe face a rapidly evolving landscape of passenger rights. The cornerstone of EU protections, Regulation 261, has long entitled passengers to fixed cash compensation for delays of three hours or more, cancellations and denied boarding in many circumstances, alongside rights to care and rerouting. However, a new round of reforms has sparked intense debate over how generous those rules should remain.
In mid 2025, European Union transport ministers agreed on a position that would revise key elements of the regulation, aiming to make rules simpler and more uniform but also potentially less generous in certain cases. Under proposals backed by several member states and welcomed by airlines, compensation for delays would only become payable after longer thresholds than at present, with suggested windows stretching to five, nine or even twelve hours depending on flight distance. Passenger groups and legal tech firms that specialize in claim recovery warn that such changes could substantially reduce the volume of eligible claims.
The revision must still be finalized with the European Parliament, which has its own consumer protection priorities, and is likely to be the focus of intense lobbying throughout 2026. While the legislative process continues, the European Commission has issued updated guidelines clarifying existing rights and how they should be enforced, particularly during mass disruptions such as air traffic control failures or widespread strikes. Those guidelines are meant to ensure that airlines and national regulators interpret the current rules consistently, even as the underlying law is debated.
In the United Kingdom, which retained and adapted EU 261 rules after Brexit under a regime known as UK261, regulators have launched a compliance program focused on whether airlines are meeting their obligations when flights are disrupted. The Civil Aviation Authority is scrutinizing the practices of the largest carriers serving UK airports, signaling that while the legal framework may diverge subtly from the EU over time, enforcement of core passenger rights remains an active priority.
Baggage, Ancillary Fees and the Push for Transparent Pricing
Checked baggage, carry on allowances and service fees form another critical policy battleground. Under the U.S. refund rule that took effect in 2024, airlines must refund baggage fees when checked bags are significantly delayed, as well as return fees for ancillary services that passengers paid for but that were not actually provided. This means that if a traveler pays for early boarding, seat upgrades or onboard connectivity and the service is not delivered, they have a defined right to reclaim that money.
At the same time, regulators have tried to require airlines to display baggage, change and cancellation fees more prominently during the online booking process, arguing that consumers often underestimate the full cost of travel when such charges are revealed only at the final checkout step. A separate Transportation Department rule that would have mandated upfront disclosure of these fees has been challenged in court, with a federal appeals panel temporarily blocking its implementation on the grounds that the agency may have exceeded its authority.
Against this contested backdrop, airlines continue to refine their own fee structures. Ultra low cost carriers in the United States and Europe typically offer very low base fares coupled with an extensive menu of add ons, from carry on luggage to airport check in. Legacy carriers, while less aggressive, have also leaned on baggage and change fees as a major revenue source. For travelers, the practical takeaway is to read fare rules carefully, especially for basic economy products that may prohibit full size cabin bags, and to factor both inbound and return trip fees into any price comparison.
Health, Communicable Disease Policies and Travel Credits
The pandemic era was marked by widespread uncertainty over what happened when travelers were advised not to fly for health reasons. The 2024 U.S. refund rule addressed some of that ambiguity by requiring airlines to issue transferable travel vouchers or credits, valid for at least five years, to passengers holding nonrefundable tickets who are restricted by government order or are advised by a medical professional not to travel due to a serious communicable disease. The rule does not oblige airlines to provide cash refunds in such cases, but it does prevent them from simply retaining the fare.
This provision reflects a broader trend toward embedding health considerations into standard passenger rights, rather than treating each outbreak as an exception. It also gives travelers a clearer sense of what to expect if public health conditions deteriorate again, though critics note that five year credits can still be less flexible than cash, particularly for those who may not be able to travel in the future. As with other passenger rights, the effectiveness of the policy depends on clear communication by airlines at the time of booking and at the moment a traveler discloses a health related restriction.
Given the complexity of medical advice and the potential for changing public health guidance, observers expect this area of regulation to keep evolving. Travelers who are immunocompromised or otherwise at higher risk may wish to pair statutory protections with comprehensive travel insurance that explicitly covers cancellation on medical advice, and to consult both airline policies and government advisories before booking long haul trips.