Why their special “circumstances” are more special than yours

By | February 7th, 2017

When Jan Vander Maten accepted her nephew’s wedding invitation, she made round-trip flight reservations on American Airlines and purchased a travel insurance policy from Allianz. But two days before the flight, the wedding was called off – and she had no more reason to travel.

When American refused to refund her airfares, Vander Maten filed a claim on her travel insurance from Allianz that supposedly covered “travel cancellations of unforeseen changes and events.” But Allianz denied her claim.

Vander Maten thinks this isn’t fair. She’d like to know: Why are airline refund terms one-sided — in the airlines’ favor? And what can she do to get a refund of her airfare?

Both airlines and insurance companies use “adhesion contracts” — one-sided contracts drawn up by the companies (or their attorneys) to standardize transactions so that they don’t have to negotiate with each individual customer.

Airlines are always canceling flights for a variety of reasons, including mechanical problems, inclement weather, airport availability and personnel issues. And insurance companies are eager to reject any claim for which the insured can’t provide absolute proof of coverage. What makes these “special circumstances” refundable — or not?

Unfortunately, that’s an unanswerable question. But it’s a fair one.

Back to Vander Maten: After her claim was rejected by both American Airlines and Allianz, she turned to our advocates for help. They suggested that she post in our forums about her situation.

American Airlines’ contract, its conditions of carriage, provides the following regarding refunds for unused tickets:

Some tickets are non-refundable. If you have a refundable ticket, American will issue a refund as follows:

  • If the ticket is totally unused, the full amount paid will be refunded.
  • If the ticket is partially used, the refund will be the difference between the fare paid and the fare for the transportation actually used as determined by the applicable rules.

In addition, if the ticket to be refunded is no longer valid for transportation, an administrative service charge will be assessed upon refund of the ticket. This service charge will be collected by deducting the applicable service charge from the amount which otherwise would be refunded. …


American will strive to process eligible refunds in the time frames set out below, upon receipt of all required information.

It also notes that “No agent, employee or representative of American has authority to alter, modify or waive any provision of the Conditions of Carriage unless authorized in writing by a corporate officer of American.”

Although Allianz’s travel insurance covers a number of situations (but not wedding cancellations), it excludes the following conditions from coverage:

In addition to any other exclusions that may apply to a particular benefit, no coverage is provided for any loss that results directly or indirectly from any of the following unless as specifically included: existing medical conditions; intentional self-harm, suicide or attempted suicide; pregnancy (unless unforeseen complications or problems), fertility treatments, childbirth or elective abortion; mental or nervous health disorders, (like anxiety, depression, neurosis or psychosis); use or abuse of alcohol or drugs, or related physical complications; war (declared or undeclared), acts of war, military duty, civil disorder or unrest; participation in or training for any professional or amateur sporting competition; participating in extreme, high risk sports; flying or learning to fly an aircraft as pilot or crew; nuclear reaction, radiation or radioactive contamination; natural disasters; epidemic or pandemic; air, water or other pollution or threat of pollutant release; unlawful acts; expected or reasonably foreseeable events or problems; financial default of a travel supplier; terrorist events; travel bulletins or alerts; and government prohibition or regulations.

Our forum advocates pointed out to Vander Maten that she had no right to expect compensation from either American Airlines or Allianz unless she had a refundable ticket or “cancel for any reason” coverage that would have allowed for reimbursement of her airfare — and apparently, she had neither.

They also suggested that she use our executive contacts for American Airlines and Allianz to appeal her case to higher-level executives at both companies.

Vander Maten has notified us that she wrote to American Airlines, whose agents agreed to waive the cancellation fee for her flights. They gave her credit for her airfares, which she can use within one year of the original booking dates.

Should travel companies be required to issue full refunds for all passenger cancellations, regardless of the nature of tickets?

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