How to Get Paid for Surviving the Southwest Meltdown

After Southwest Airlines canceled thousands of flights around Christmas, numerous holiday travelers were stranded. Now they want their money back.

Many travelers paid out-of-pocket to rebook on other airlines or to get to their destination through other means, such as a rental car or train. Other prepaid, nonrefundable reservations such as show tickets, cruises, tours and hotel rooms might seem like lost costs.

Genna Scisci, a public relations executive from Chicago, was planning to fly to Albany, New York, for the holidays, but she gave up after four canceled Southwest flights. Since she made multiple trips to the airport, she is seeking reimbursement for about $150 worth of rideshares. Scisci says she hasn’t received that money back, though she did get a refund for her original round-trip flight.

If you were affected by the cancellations tied to the Great Southwest Meltdown, it’s not too late to try to recoup some of the costs.

25,000 Rapid Rewards points

Southwest sent promo codes for 25,000 Rapid Rewards bonus points per flight via email to many travelers who had flights canceled or significantly delayed between Dec. 24, 2022, and Jan. 2, 2023. Southwest told NerdWallet that only those with flights between that period that were canceled or delayed considerably — and who elected not to rebook — received codes. However, some flyers have reported getting codes even after traveling on a rebooked Southwest flight.

To redeem those codes, Southwest travelers must visit a separate Rapid Rewards points website before March 31, 2023. The website often requires a wait to access it. Usually, the wait times are just a few minutes — a fraction of the hours-long customer service hold times people were reporting during the Southwest meltdown.

Southwest promises that 25,000 points equate to a base fare redemption of more than $300. Though based on NerdWallet’s analysis, Southwest points are usually worth about 1.5 cents each, making 25,000 points valued at an even-higher $375 when redeemed for a future flight. If you received two codes, that’s worth $750, by NerdWallet’s estimates.

Extending elite status and Companion Passes for some

If you held Southwest elite status that was set to expire, you may get a small extension. Southwest emailed some affected travelers who held 2022 Companion Passes or had A-List or A-List Preferred status, promising to extend their status through Jan. 31, 2023.

Reimbursement for other expenses

Southwest says customers with flights canceled or significantly delayed between Dec. 24, 2022, and Jan. 2, 2023, can submit receipts for “reasonable” expenses such as rental cars, other airline tickets and food via this webpage for consideration.

Southwest would not provide specifics on the exact items that would be reimbursed, simply stating in an email to NerdWallet that customers “are encouraged to submit items for consideration.”

That said, Southwest has seemed to be pretty generous so far in terms of what it's refunding.

A NerdWallet employee who got caught up in the meltdown submitted a reimbursement request for a rental car and two hotel nights. On Jan. 18, 2023, they received an email from Southwest saying the request was approved.

NerdWallet has also confirmed that expenses that have been reimbursed included a cancellation fee for Getaround, which is a type of rental car alternative, was refunded (the traveler never got to their destination thus never used the car.

Southwest also reimbursed a rebooking fee for tickets to a show they missed at a theater, which charged $10 per ticket to rebook the seats for a different night.

When will refunds be issued, and in what form?

While Southwest told NerdWallet that no deadline for reimbursement requests had been set yet, it’s best to submit receipts as soon as possible to maximize reimbursement odds. Southwest also did not say how long those reimbursements would take, but it could be a while since the airline is prioritizing flight refunds first.

Under Department of Transportation regulations, customers are entitled to a refund if the airline cancels a flight and the customer chooses not to travel. This applies to all passengers with U.S. airfares, no matter the reason. 

The government also mandates that refunds are issued within seven business days of the airline receiving the request with proper documentation if a passenger paid by credit card and within 20 days if a passenger paid by cash or check.

“That is currently our top priority to assist our customers,” said Chris Perry, a Southwest spokesperson, in an email to NerdWallet.

From there, Southwest will turn to other out-of-pocket refunds — and many of those were issued throughout January.

Most requests are being refunded through Hyperwallet Payouts, which is a company affiliated with PayPal. Most customers are reporting that — within a day of receiving the Southwest email saying their request was approved — they receive a separate email from Hyperwallet enabling them to initiate the refund. HyperWallet offers a few options to transfer money, such as directly to your checking account, or transferred to your PayPal or Venmo account.

Other avenues for getting compensation beyond Southwest

Travel insurance companies might move faster and may be willing to cover expenses that Southwest will not. If you purchased it, contact your provider immediately. 

Even if you didn’t purchase trip insurance, your trip might’ve been insured anyway. Many travel credit cards insure trips purchased on that card, so check with your issuer to see if they offer the benefit and ask if your trip is eligible for reimbursement.

What’s next for Southwest?

Many customers are still annoyed by the chaos, and many bags are still missing. However, Southwest says it had most separated bags delivered or shipped in the first week of 2023. 

And to prevent future issues, Southwest CEO Bob Jordan promised to prioritize building better tools, technologies and processes.

“There's just no way almost to apologize enough because we love our customers, we love our people, and we really impacted their plans,” he said in a statement. “There'll be a lot of lessons learned in terms of what we can do to make sure that this never happens again because this needs to never happen again."

(Photo courtesy of Southwest Airlines)