Your Flight Was Canceled, Now What? Make These 8 Money Moves Now

Your flight was just canceled. Now what? Unexpected disruptions can send even the most seasoned travelers into a frenzy.

Happily, flight cancellations are less common these days. For the first three months of 2023, the cancellation rate among U.S. airlines was 1.7%, down from 4.1% for the same period in 2022, according to the latest Air Travel Consumer Report from the U.S. Department of Transportation (DOT). But for the unlucky folks in that 1.7% bucket, a canceled flight often can be just as disruptive to your bank account as it is to your travel plans. That is, unless you make the right money moves.

From understanding your right to a refund to securing alternative arrangements, take these steps to get your trip back on track for minimal cost, while also getting the flight cancellation compensation you deserve.

1. Get rebooked on the next best flight

Every major U.S. airline has promised to rebook passengers on the same airline at no additional cost, and many airlines rebook you automatically, which might eliminate the need to mob the customer service counter. Check your email, or the mobile app or website of your airline to see if you’ve been automatically rebooked.

If you’re at the airport and you haven’t been automatically rebooked, make a beeline for the customer service desk. Time is money, and others on the canceled flight will be headed that way, too, competing for what might only be a couple of available seats on the next departing flight.

What if the flight they rebooked me on doesn't work for my travel plans?

If there's another flight you'd rather take that's to the same or a nearby airport as your original destination, you can typically ask to be moved, again usually at no additional cost.

Some airlines also let you rebook on a partner airline (for example, Alaska Airlines and American Airlines are partners) at no additional cost. Though, that also assumes the partner airline is flying the route you need to take.

If you want to fly with a different airline, you'll likely be on your own in terms of cost. And booking last-minute airfare is typically expensive. While U.S. airlines are legally required to refund you for significant delays or cancellations, that might not be helpful if you snagged a $49 fare deal for a flight that has since been canceled, and you're now booking last-minute with a different airline for, say, $499. The $49 refund on a new $499 airfare might just feel like salt in the wound.

2. Turn to your travel insurance

The exact terms of travel insurance vary by policy, but if it includes trip interruption benefits, you may be refunded for additional costs incurred due to the cancellation. The best travel insurance policies will reimburse you for up to several thousand dollars in expenses.

Most major airlines will fund complimentary hotel accommodations for cancellations, but not all (such as Frontier Airlines), in which case travel insurance can help. Travel insurance can also get you compensation for alternate transportation arrangements, like a rental car or a flight on another airline.

Just ensure that the reason you're invoking your policy is truly a covered reason, as not every insurer will protect you from every scenario. For example, severe weather is typically covered, though not always. Meanwhile, a country closing its borders due to a pandemic generally is not covered by any policy except the most comprehensive Cancel For Any Reason policies.

You might have bought travel insurance from a specific insurance company or added it to your airfare upon checkout. But you might also have travel insurance without even knowing it. Many travel credit cards offer trip insurance as a perk simply for paying for that trip on the card. Check out your credit card's guide to benefits (typically mailed to you upon approval or posted online) to see if yours offers this deal.

3. Look for other ways to get to your destination

If your travel insurance won’t book an expensive, last-minute flight on another airline — and your airline can’t rebook you on a flight that will get you to your destination on time – you might consider other alternatives to getting to your transportation.

A rental car might work. Delightfully, a NerdWallet analysis found that booking car rentals at the last minute can save you 15%. It’s also a myth that one-way rental cars are always more expensive. Sure, they can be sometimes, but at other times they can actually be cheaper if the rental car company is trying to reroute its fleet.

Look to other nearby airports, too. And, consider alternative modes of transportation such as trains.

4. Get fair compensation

The customer service desk is also the spot to request flight delay compensation. It's not legally required under U.S. law. Still, many airlines have made customer service pledges in the event of controllable cancellations and delays — promising relief like meals or hotel vouchers for delays (usually of three hours or more). These are outlined in the DOT's Airline Customer Service Dashboard. Even if circumstances don't qualify under the airline's official pledge, the gate agent might still issue you bonus miles or meal vouchers for shorter delays — if you ask nicely.

Air travelers in Europe have even more rights. Under EU flight delay compensation rules, travelers are entitled to up to 600 euros for delays and cancellations, depending on the trip distance and length of the delay.

If you're not at the airport when you hear about your delay or cancellation, contact your airline's customer service via phone, mobile app or social media accounts.

5. Find your luggage

While at the customer service counter, find the status and location of any checked bags. They could be on the aircraft or could have been offloaded. Ideally, your bags would be labeled with your contact info on luggage tags to alleviate any stress of lost stuff. However, stay in communication with airline staff to reduce the risk of being separated from your stuff longer than necessary.

And while the airline should be tracking your bag, you can track it yourself. Devices like Samsung Galaxy SmartTags or Apple AirTags can communicate with a paired smartphone or tablet via Bluetooth to share locations. Since these products don't use a SIM or their own data connection, there is also no monthly fee to use these devices beyond the initial cost to buy them (and they typically cost less than $50).

While you should never pack essentials like medication in checked baggage (keep that in your carry-on), the customer service counter can usually help you retrieve your bags should you need to access your stuff in the interim.

Most travel insurance policies include some form of lost luggage reimbursement, so you can get money back for items you packed and lost, should your bags end up gone for good amid the chaos of a canceled flight.

6. Make last-minute plans to pass the time

If all flights are canceled and you're stuck, it’s time to make other last-minute plans. If the airline won’t pay for lodging, turn to last-minute hotel deals sites like HotelTonight. Happily, a NerdWallet analysis found that it's almost always cheaper to book hotels last-minute anyway. After analyzing 2,500 hotel room rates, NerdWallet found that it was cheaper to book a hotel room 15 days out versus four months out a whopping 66% of the time. And the best deals come with luxury hotels — so that delay might be a chance to treat yourself. Hotels classified in our highest tier averaged nearly 22% cheaper when booked 15 days out versus four months out.

And if you need to entertain yourself for a bonus night in a city you never intended to be in that night, start making last-minute plans. Websites like TodayTix offer tickets to shows that night, often at a steep discount anyway.

7. Wait it out in the airport

If you're stuck for just a few hours, you might just wait it out in the airport. While some airports are still painful to wait in, increasingly more U.S. airport terminals are getting better. These days, you might find airports with entertainment or activities including yoga rooms, live music and museum. Others simply offer stunning views. Take Wyoming's Jackson Hole Airport, which is considered one of America's most charming airports; it takes full advantage with soaring windows that frame the mountain range.

You might also post up in an airport lounge. Lounges can offer relative quiet, comfortable seating and complimentary refreshments. To access the lounge, you often need to hold elite status with an airline or be flying on a business or first class fare.

But that's not the only trick to getting into these exclusive lounges. Access to airport lounges is among the most popular perk on premium travel credit cards. Here's a guide to the best credit cards that offer lounge access.

8. Get a refund

If your flight was canceled by the airline and you’ve opted not to fly, know that you are entitled to a refund.

Yes, that means you are eligible for a full refund under Department of Transportation regulations. The definition of "major changes" isn't totally clear, but in general, any schedule change of more than 24 hours should be eligible for a full refund.

The exact process to get a refund can vary by airline, but typically there’s a portal on their website where you can request one, if it wasn’t already automatically applied to your account. You might also hit the customer service desk.

Dealing with last-minute flight cancelations

Having your flight canceled is never a fun experience, but it can be made all the more challenging when confronted with a host of different rules and conditions for each type of booking. Be patient and prepared.

Know that you’re always entitled to a cash refund if you don’t opt to fly on another flight with that airline. But a full refund doesn’t necessarily make up for a disrupted trip. You might be stranded in an unfamiliar destination. Or perhaps worse, you might not be able to get to the destination you need to be at, thus you might be missing a wedding, business meeting or sporting event. You might just miss out on the vacation you already booked and paid for, like that departing cruise or tour.

That’s why having travel insurance can be handy. Perhaps even more handy is to have that backup plan.