What to do if your flight is delayed or cancelled: Consumer protections, insurance and your rights

Australian travellers are facing another school holiday period marred with travel chaos, as hundreds of thousands of passengers experience flight cancellations across the globe.

Airlines and airports have warned of more turbulence to come, as ongoing staffing shortages and reduced flight capacity collide with increased demand.

Within Australia, April saw the worst on-time performance on record for flights, including during the busy school holidays period. The latest government data shows things barely improved in May and cancellation rates became worse.

Sydney-based former judge Kenneth Raphael rescheduled a recent connecting flight in the US at extra cost, after his original Qantas flight was pushed out by a day. However, despite allowing three hours, further delays meant he arrived with barely 40 minutes to make the connection.

"After queuing for 45 minutes for our boarding passes, we finally reached the head of the queue, by which time the plane had left," Raphael said. "We were told the next flight was full and to return the next day. We asked to be placed on standby and got the last two seats on the last flight, arriving in Austin at 1am."

Raphael isn't alone, with missed connections leading the logistical headaches for passengers and travel agents.

Dean Long, CEO of the Australian Federation of Travel Agents, said flight cancellations are now a regular occurrence.

"Pre-pandemic, aviation schedules were tightly controlled with a lot of capacity. Post-COVID, those systems are stretched to the limit," said Long.

This means if the first flight leg is delayed, there are far less seats available for you to rebook on.

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"International flight capacity used to be at an average of 80 per cent. It's now about 95 per cent, which means there's only five per cent flexibility if there's a cancelled flight or missed connection," Long said.

And the seats that are left, are certainly not at the same price.

"Where we are able to find replacement fares, those fares are typically at double and triple the original cost due to the very limited availability and price increases," Long said.

So your flight has been cancelled. What next?

Find out how the airline intends to make good for the cancellation and decide whether that works for you, said Canstar finance expert Steve Mickenbecker.

Mickenbecker noted that if the delay or cancellation will result in further travel disruptions and cost, then you should put in a claim with the airline, as travel insurers will not pay out on claims the airline is able to compensate for.

That said, it's worth submitting a concurrent claim with your travel insurer so you don't miss the crucial claims window.

"Even if you are in doubt, put in a claim within the insurer's specified timeframe," said Mickenbecker.

Passengers are also advised to check the status of their flight, and sign up for airline flight alerts, before taxiing into the departures terminal, to avoid being stranded at the airport for longer than necessary.

Am I entitled to a refund/compensation?

"Flights bought in Australia or on an airline's Australian website are covered by Australian Consumer Law with automatic guarantees that the goods or service will work and do what you asked for," said Mickenbecker.

As part of that guarantee, the airline accepts there is a reasonable timeframe implied in this obligation.

Compensation claims can often hinge on whether the disruption is caused by factors within or outside of the airline's control, or which country your flight delay occurs in.

"Other jurisdictions have their own consumer laws which may confer different rights on the consumer. Likewise different airlines have their own cancellation policies," said Mickenbecker.

If you're dissatisfied with the airline's response, you can appeal with the Airline Customer Advocate scheme.

"Beyond that, there is a complaints process with the state-based consumer protection agency or the Office of Fair Trading," said Mickenbecker.

Am I covered by insurance?

"The only remedy many airlines are offering is a refund, which doesn't help the traveller get to their destination. And if [a travel agent] can find a replacement flight, you are almost invariably going to have to pay more than you did originally," Long said.

It makes the task of buying the right travel insurance all the more pertinent.

Mickenbecker said: "Depending on your travel insurance policy or provider, you may be covered for costs relating to accommodation, transport and food as a result of a missed flight, so be sure to check this with your provider ahead of time."

It's only when airlines aren't able to deliver on the agreed flight within a reasonable timeframe due to uncontrollable events that they might avoid this obligation.

"If these events are covered by your travel insurance policy, a claim may be possible," said Mickenbecker.

However, events covered and exclusions vary widely amongst policies, so it's important to check the product disclosure statement before you buy and choose insurance that covers a broad range of events.