The Upside To Air Canada’s Temporary New Cancellation Policy

Recently Air Canada released a limited-time amended cancellation policy for for new and pre-existing flight reservations. Something much discussed lately has been the thorny issue of airlines providing a voucher in place of a refund, to which a customer is entitled when the airline cancels your flight. I’m going to leave that quagmire to the side and focus on voluntary cancellations of newly booked tickets under this updated policy. 

New Cancellation Policy

In light of the coronavirus pandemic, Air Canada has decided to implement a “goodwill” flexible booking policy:

Flexible Booking and Cancellation Policies

Under a revised goodwill policy, new bookings made up to June 30, 2020 can be changed without fees for original travel between March 1, 2020 and June 30, 2021.

In cases where Air Canada cancels flights due to COVID-19, customers with refundable tickets will continue to have the option of refunds. Since January 1, 2020, Air Canada has refunded nearly $1 billion to customers.  Both customers with refundable and non-refundable tickets will have two new options to choose from:

• An Air Canada Travel Voucher for the remaining value of their ticket that has no expiry date, is fully transferable and retains any residual value or;
• The ability to convert the remaining value of their ticket into Aeroplan Miles, with 65 per cent more value versus the normal rate for buying Miles.

For voluntary changes, customers with refundable tickets will continue to have the option of refunds or the above new options. For Air Canada customers with non-refundable tickets making voluntary changes on tickets issued up to June 30, 2020, with an original travel date between March 1, 2020 and June 30, 2021 inclusive, they have the option to choose from the two above new options of an Air Canada Travel Voucher or Aeroplan Miles.

The new goodwill policies and cancellation options are retroactive for customers with original travel between March 1, 2020 and June 30, 2021. Customers whose flights have been cancelled due to the impacts of COVID-19 and who have already received travel credit valid for 24 months, will be able to select one of the applicable options depending on their fare at aircanada.com beginning June 15, 2020. Customers with Aeroplan Flight Rewards can continue to cancel their redemption bookings free of charge through June 30, 2020.

The Two Options

So, if you change your mind about travelling and wish to cancel, you can choose between a non-expiring, transferrable voucher or a conversion to Aeroplan miles. If you’re going to opt for the latter you’ll obviously need to get a good handle on the value you’ll be able to derive from those miles compared to the voucher. It’s an interesting option but who knows what the future holds for the Aeroplan program.

Booking Deadline – June 30, 2020

At this point, only tickets purchased by June 30, 2020 will be covered by the new policy. Perhaps that date will be extended, but as it stands, it means you can book travel under the new cancellation terms for travel well into 2021.

Speculative Booking

When planning a trip, if you’ll be staying at a hotel it’s pretty easy to lock in a commitment-free reservation. You just need to pay close attention to the no-penalty cancellation deadline. I’ve made lots of speculative hotel bookings without thinking that I’ve actually booked a trip. It’s a reservation in your back pocket should you decide to use it.

However, booking a flight is very different. Unless you’re shelling out for a pricey refundable fare, you’ll be booking a regular non-refundable ticket. And if you later decide not to go, it will cost you to cancel. Your travel plans have to be fairly firm if you’re going to pull the trigger on the flight.

If I’m reading this new policy correctly, when you book an Air Canada flight by June 30, 2020 for travel up to June 30, 2021, you won’t be charged any fees to cancel voluntarily.

There is an obvious downside to this – if you book a flight long in advance, a better option could come along later that you’d prefer. You’ll have to be comfortable with holding a voucher if you choose to cancel and book a trip on a different airline. I know that some people often book flights way in advance of their trip but I tend to wait till about three or four months out on average. There is also the issue of trip insurance since the subsequent voucher flight will not be paid for with your credit card.

If you regularly take a certain Air Canada flight, then this will perhaps be more appealing. For example, until the 737 Max 8 debacle, the only year-round non-stop service from Halifax to London was Air Canada to Heathrow.

So, Any Good Fares for 2021?

I did some brief searching and nothing jumped out as a stupendous deal, but it might a good idea to monitor fares throughout June for early 2021 if you think you’ll possibly be ready to travel during that period. Here are a couple of sample fares…

Moncton – Orlando
March 13-20, 2021
$516

Halifax – London, Dublin – Halifax
March 27 – April 8, 2021
$751

What About WestJet?

It appears that WestJet has a similar policy for bookings up to June 30, 2020:

Flexible change/cancel policy for new bookings

The main difference appears to be that the cancellation results in a Travel Bank credit valid for 24 months from the date of issue whereas the Air Canada voucher has no expiry date.

Final Thoughts

It’s interesting to see what companies are doing to try to encourage people to book travel. If you’re signed up for Travelzoo weekly emails, you’ve probably noticed the words, “Fully Refundable” or “Flexible Options Available” clearly stated under each offer.

Making travel plans during this time of uncertainty is tricky. My inclination is to wait and see how the pandemic progresses and if a vaccine is achieved. That said, I like to watch for great airfares and if something comes up next month while this policy is in effect, booking for 2021 travel is not entirely beyond the realm of possibility.