If they resell my room, why can’t I get a refund?

Just before Gerald and Byrone LoCasale set sail on an 18-day Princess cruise from Fort Lauderdale, Fla., to Los Angeles, disaster struck. Byrone LoCasale sustained an injury that required immediate orthopedic surgery. The couple, both frequent Princess customers, reluctantly canceled the trip.

But there was good news. LoCasale, who is retired and lives in Fort Lauderdale, learned that Princess had resold his cabin. Getting credit for the $16,201 they’d spent would be easy, right?

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Well, no.

LoCasale faxed all the necessary medical documentation to Princess, but it didn’t respond. He e-mailed the cruise line and received a terse phone call from an unnamed representative. “The answer was very short,” he says. “They decided not to honor my request.”

Travelers understand “no refund” policies. But when a room, cabin or airline seat can be resold, it’s harder to explain why the consumer’s money is still gone. Although some companies routinely refund such purchases, many do not. Now, advocates are pushing for more customer-friendly policies.

I contacted Princess several times about LoCasale’s case. A spokesman said its records show that the cabin wasn’t resold. Rather, it upgraded another passenger to LoCasale’s empty cabin.

Princess applied a 25 percent credit toward a future sailing “as a gesture of goodwill and to show our appreciation for their future business,” said Brian O’Connor, a cruise line spokesman.

It doesn’t always end like this. David Valade had a reservation at the Hartstone Inn and Hideaway in Camden, Maine, which has a similar no-refund policy. If you cancel your reservation 14 days before your arrival, it will charge you for one night.

But, like LoCasale, he had to change his plans because of events beyond his control — in this case, a death in the family. Valade canceled his reservation without sharing any of the unfortunate details.

“Their policy was clear, and I knew the risk,” he says. “When I called to cancel, they told me they’d refund if they rebooked the room. And they did.” A few days later, the inn contacted him and credited $479 back to his card.

Many small hotels do the same. “We do it because, quite frankly, it’s how we’d like to be treated,” says Stephen Fofanoff, the innkeeper for the Domaine Madeleine Bed and Breakfast in Port Angeles, Wash. “We’re a luxury property, and our goal is for everyone to have an experience that exceeds their expectations, even if they don’t end up staying with us.”

At Domaine Madeleine, if you cancel 14 days or fewer before your planned stay, the hotel charges the full amount of the reservation and a $25 cancellation fee. The fee allows the hotel to track the reservation so it can determine whether the room is resold.

“Anything that is resold is refunded after the reservation dates have ended to account for any last-minute reservations, unless the entire date span is rebooked — then we refund immediately,” he says. “If the reason for cancellation is out of the control of the guest, like a medical illness or weather preventing travel, then we refund the stay and do not charge a cancellation fee even if the room is not resold.”

Ah, but that’s a small business. But how about something more complicated, with lots of components, like a tour?

Elizabeth Avery, founder of Washington-based Solo Trekker 4 U, is developing a technology platform that would in effect allow the resale of tour inventory that’s canceled at the last minute.

“Resales would benefit tour providers that may suddenly lack a required minimum number of participants,” she says. “It would also benefit travelers who are uninsured but must cancel at the last minute. They would only have a partial loss.”

The reason she says “partial” is that tour packages tend to be bundled and contain components that are nonrefundable.

Airlines are probably the most rigid when it comes to offering your money back. To get an idea of how inflexible they are, consider that until the Department of Transportation stepped in and required a 24-hour cancellation window, virtually all tickets were unchangeable from the moment they were booked, even when the consumer made an obvious error.

The DOT’s new rule, introduced in 2012, forced airlines to hold a reservation or cancel it without penalty within a day, unless the flier was less than a week from departure. In other words, it assumed that the airline would have a sufficient opportunity to resell the seat.

The National Consumers League, a Washington advocacy group, has been pushing the federal government for fairer refund rules. Instead of a simple 24-hour-window rule, they want airlines to refund a ticket if a seat is resold. To the average consumer, that makes a lot of sense. It’s an issue of fairness to them. A travel company wouldn’t stand for its guests collecting frequent stayer points on the same room twice or pocketing a refund from both their travel agency and hotel, so why should their travelers tolerate it?

The standard industry rebuttal, offered only in off-the-record conversation — and after you get past the technology excuse — is: We do it because we’re a business, and because we can.

But collecting money twice for the same product smacks of profiteering, and if consumer advocates such as the National Consumers League have their way, it won’t be legal for much longer.

This article was originally published on July 27, 2015.

16 thoughts on “If they resell my room, why can’t I get a refund?

  1. Not sure if “profiteering” is the right word.
    I’m more thinking contemptible, wrong, or awful. Can’t they make an HONEST buck?

    1. The cruise line did not resell his room. They upgraded another passenger to his room. So, that still left the cruise line with the room the upgraded passenger had before the upgrade. Rules are rules. If you don’t like them, don’t sail. If you are worried about losing money because of some unforeseen circumstance, purchase travel insurance!

      1. “They upgraded another passenger” is the universal excuse we get from cruise line personnel, but we have no way of knowing that.The fairest option for any nonrefundable ticket would be to allow the passenger to give/sell it to someone else who can make the trip. The sale is still final, but the passenger is not as apt to feel cheated.

        1. So if a PAX bought his/her ticket long in advance of the cruise, and got it at a substantial discount, then decided since fares have now risen so much, he would be better off reselling it to someone at a profit [but for less than the crusie line is currently selling that cabin type for], should the cruise line allow that? If you rent an apartment from a landlord, most leases require that if you are even allowed to sublease [or rerent that apartment] you cannot make a profit, in fact most sub-lesses need approval from the building owner to do so. How do you propose the cruiselines monitor all of this Craigslist type of reselling of cabins? Or are you proposing it is ok for anyone at anytime to resell their cabin and the cruise line simply has to allow it?

          1. “Or are you proposing it is ok for anyone at anytime to resell their cabin and the cruise line simply has to allow it?”

            Precisely. You’re arguing a unicorn hypothetical: any individual speculator who manages to consistently outguess a cruise line on ticket pricing by buying low and selling high is a person that line would want to grab for its marketing department.

            Meanwhile, miscellaneous real people who get sick, have to attend a relative’s funeral, pull jury duty, unexpectedly have to work, or unexpectedly get laid off don’t have to waste a ticket. The cruise line still has its money and doesn’t have to mess around with excuses and refunds, and customers are more likely to risk buying future tickets, expanding the market. Everybody wins.

          2. I never mentioned the word “speculator”, just as most people that want to sublease their apartments are people who find themselves in circumstances they had not originally planned on [although I am sure there are speculators in that realm]. However, if I have purchased a cruise/airline/resort ticket/cabin, and now find months later that I can resell it for significantly more than I paid for it, I just might be tempted to do so even if my circumstances were not quite so dire. Now to your speculation about hiring the “smart” so called speculator. What makes you think that someone that can on a reasonably consistent basis make an accurate educated/speculative bet would want to work for the salary a cruise line would pay him/her. The only reason those speculators dont currently exist is because the cruise lines rules and regulations effectively make it impossible for an individual to resell these tickets. Open that door up, and you will see hundreds or thousands of really smart people set up shop doing just that. Ever hear of STUBHUB? Used to be against the law to resell a concert ticket for anything more than you paid for it. You want to see Adele in NYC or any other major arena on her 2016 tour? Be prepared to pay many times the price on the ticket because all of the SPECULATORS bought them up. Sorry to disagree with your premise, but if a cruise passenger is spending thousands on a cabin and does not purchase insurance, it is on them, not on the cruise line. It is a little used or understood concept these days, and it is called “personal responsibility”.

          3. If concert, or cruise tickets, routinely would sell for a lot more than face, then obviously the operator itself, an expert in selling concerts and cruises, would be charging more in the first place. Both are markets, in which prices over time converge on a value that operators and customers can depend on. Your hypothesis that cruise operators are routinely selling tickets for less than market as a favor to their customers is rather naive.

          4. You obviously misread or I was unclear in my “hypothesis”. In many cases in the travel industry, operators will sell tickets/cabins at a lower rate the further away from the actual travel date. Certainly not 100% true [and probably almost never true around known vacation periods/school holidays etc], but true that in enough cases, a ticket bought for a cruise a year in advance would be less expensive than if that same cabin were purchased weeks in advance. If all restrictions on ticket transfers were eliminated, and cruise lines were required to simply sit by and allow it to happen, there would, without a doubt in at least my mind, be a secondary resale market formed. Perhaps with a middle man extracting a fee, perhaps with the original purchaser selling tickets for more [or even less] than the original price. How about the tour operators in each stop on the itinerary, should they also be required to honor the sale of individual excursions purchased by the original ticket buyers? After all the illness/death/hangnail of the original PAX would make them unable to use it, so why not that as well? To be honest, you and I, as can be seen from dozens of previous blog posts come at this whole type of scenario from pretty much opposite sides of the spectrum. I believe that consumers should be given choices as to how much risk they are willing to take on by vendors offering different price points for differing amounts of risk, and you typically seem to believe that all [or almost all] risk should be on the vendors shoulders even though the consumer made [in most but admittedly not all] an informed decision to take on substantial risk themselves. I once again will say that personal responsibility is sorely lacking in many parts of our current society, not just “travel”. I respect your opinion differing from mine, it is what makes the world go around, I just happen to believe that businesses should succeed or fail based on free market forces and consumer choice, not via government fiat.

          5. Of course cruise operators sell tickets for less farther out from the sailing date. On any given date, the price discounts the uncertainty of making a sale at that particular count of days-to-sailing. Any speculative purchaser of tickets would encounter the same risk and would this have to offer the same price curve to his resale customers; if any exploitable, consistent difference existed, the cruise operator himself would adjust his own price curve accordingly. Hence, no consistent advantage to buying tickets for speculative resale.

            It’s been many years since I minored in econ, but this stuff is basic business practice, and I still have to be aware of it in offering IT services.

          6. I guess I am just wondering why the promoters didnt price their Adele tickets hundreds of dollars higher than they did since so many people are now willing to pay many multiples of the face ticket price to get one. Guess they are lousy businessmen and dont understand basic business practices as well as you do. Another basic business practice which you seem to sometimes forget about is that business exists to earn a profit. If what they do to earn that profit is too consumer unfriendly, consumers will soon enough vote with their pocketbooks to buy elsewhere. The real world, with its many unforeseen happenings doesn’t go by Econ 101 textbook rules. In the world of IT, everything boils down to a binary decision, 0’s or 1’s. If this then that, if A then B. That is all a computer can do, so all system design ultimately needs to be broken down to a series of digital logic functions [AND, OR, NOT, NAND, NOR, EXOR and EXNOR]. The real world is analog, and no college course or textbook can predetermine the real world events that occur that might affect the value of something. Ever think you would see gasoline again at $2.00 a gallon so soon after the experts said we were running out of fossil fuel and the price can only go up? As they say, “stuff” happens. Speculators are willing to place “bets” on many different things, and if allowed they would somehow figure out a way to attempt to make a profit on a cabin on the J deck of the Carnival Princess, and all of the small excursion tour operators would have to figure out a way to monitor and control who will be swimming with the dolphins in Tortuga. Can it be done, absolutely [at what cost?], do I want to pay for it just so someone else can not have to take personal responsibility and buy insurance to protect themselves, not if I can help it.

          7. The Adele tour is an interesting case in point. Speculators could place bets on whether a given performer will suddenly become faddishly hot property in the way that Adele just did. The promoters priced their tickets according to their expectation of the market months out for each concert date. They remain in business because, tour after tour, their assessment of the market is better than that of a speculator who might get lucky right now in Adele ducats, but who will most likely lose on bets placed on long runs of concerts.

            Here in Arizona, where concert and game ticket resale is totally legal, speculating on ticket sales is still about as reliable as investing at our many reservation casinos. The people who make money on event tickets are (a) the promotors, who know the business, and (b) ticket brokers who sell on commission and offer convenience.

  2. What can we do to get travellers to understand that they need to INSURE anything prepaid that they can’t afford to lose? So sad that people don’t understand how important it is. It’s a simple concept: I can absorb a $200 change/cancel fee on my airline ticket, but a CRUISE?

  3. Sure, the couple should have had insurance, but to just keep their money – which the cruise line did not earn – is just plain wrong.

    ““We do it [give a refund] because, quite frankly, it’s how we’d like to be treated,”

    Exactly. Sure, the vendor gets something for nothing and can conceal a giggle and eat lobster for a few months, but they lose in the end as that paying customer isn’t coming back and neither are their friends, family and folk who read about such shenanigans on social media.

    I know that other factors are at play here, but you HAVE to treat the people who keep you in business properly. Anything else is a dumb business move.

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