A boatload of disgruntled cruise passengers has contacted the Elliott Advocacy team during the pandemic. Their question? How to get a refund instead of future credits after a cruise line canceled their voyage — more than once.
Unfortunately, the answer to that question is not what most want to hear. But the tide has recently started to turn, and there is some good news on the horizon. (Updated April 24)
Without a doubt, 2020 was Armageddon for the cruise industry. The coronavirus created a situation that no one could have predicted, and its impact continues today. Here’s the truth about why, at least for now, you’ll likely only get a voucher instead of a refund for your canceled cruise in 2021.
The coronavirus shuts down the cruise industry
On March 8, 2020, as the coronavirus continued to spread, the U.S. State Department issued a Do Not Cruise recommendation. And just one week later, the pandemic shockingly caused the entire cruise industry to come to a sudden “temporary” halt.
With thousands of worried cruise passengers wondering what to do, the situation quickly descended into chaos.
At that time, we warned our readers to stay calm and not cancel their upcoming vacations too soon.
Unfortunately, not everyone in the world reads the Elliott Advocacy site — at least not yet. 😜
Just before and immediately after the announcement of limited cruise cancellations through mid-April, many passengers prematurely jumped ship. With fears about the coronavirus growing, a significant number of travelers canceled cruises far beyond that date.
Fact: Cancel your cruise before the cruise line does, and you won’t get a refund
The result? Instead of a refund for sailings that the cruise lines eventually canceled, these passengers only received a future cruise credit. Worse, some cruise lines held passengers to the standard cancellation policies on their contracts.
Of course, no one had any idea that the pandemic would drag on for this long. And so, when the cruise lines started rolling out incentives to encourage passengers to cancel preemptively, many happily accepted.
Our case records show that a large number of these travelers failed to understand the significance of accepting that initial future cruise voucher. In fact, the implications of this decision would not become clear to these cruisers until the pandemic forced the cruise line to cancel their rescheduled sailings, too.
Leslie Minor was one of those passengers who only discovered the terms of the future cruise credit after it was too late.
The cruise line asked me to take a future credit instead of a refund
NCL canceled my cruise in April 2020. The cruise line offered me a 125 percent voucher if I agreed to rebook instead of taking a refund for the canceled trip. The offer impressed me. But who knew that this pandemic would continue for so long? So I rebooked for April 2021. Of course, NCL canceled that cruise, too, and I asked for a refund. NCL rejected my refund request and said I would only get another future cruise credit. What’s going on here? It’s my understanding that if a cruise line cancels the trip, it owes me a refund. Please help!
When I reviewed Minor’s paper trail, I knew the original terms of her future cruise credit said that she wasn’t eligible for a cash refund. We’ve received tons of similar complaints in the past several months from cruisers who accepted vouchers for canceled cruises last year.
The voucher terms are firm: no cash refund for a rescheduled cruise that is canceled later — even if the cruise line cancels that trip.
However, Minor’s travel agent and Norwegian Cruise Line continued to bounce her refund request between them. It was clear that neither entity wanted to tell her the truth.
This is an unfortunate situation we’ve seen time and again during the pandemic. Many companies, hoping to maintain good relations, will not give their customers the bottom line. So they send these frustrated consumers off on wild goose chases that will never end in their favor —likely hoping that some other company (or a consumer advocate) will break the news or that the person will eventually give up the pursuit.
Minor was caught in an endless loop between her travel agent and NCL, causing her major pain.
Fact: If you’ve paid for a cruise with a voucher, you won’t get a cash refund
When a cruise line cancels a sailing, it owes the passenger a refund. See:
But cruise lines worldwide always provide that refund to the same payment method used to book the current trip. So if a customer paid for their current cruise with a voucher, and the cruise line cancels the new voyage, the traveler will only receive another future credit.
Instead of making that clear to Minor, her travel agent and NCL sent her in a new direction. They recommended that she try to file a claim through her travel insurance policy. This suggestion could never have resulted in a positive outcome.
But Minor didn’t know that it was just an exercise in futility, so she focused on her new, complicated mission.
This was a refund pursuit that would prove to be a giant waste of her time.
Fact: Travel insurance will not cover a sailing canceled by the cruise line
Travel insurance covers unexpected events. And most policies issued today provide coverage for only “named perils” — things specifically listed in the document. If something isn’t listed, it will not be covered.
And no policy will cover a cancellation that the cruise line initiated. The cruise line is required to reimburse the traveler in that case.
Note: Remember, when a cruise line cancels your trip, it owes you a refund back to your original form of payment for that particular sailing.
Additionally, even if the cruise line hadn’t canceled Minor’s trip, the reason for cancellation would need to have been named in the policy. Unless a traveler has contracted coronavirus, our team has not seen any insurance policies covering COVID-19 cancellations. In fact, in many policies, a pandemic-related cancellation is named explicitly as an exclusion for coverage.
In Minor’s case, after the cruise line officially canceled her latest sailing, there would be no circumstance in which the travel insurance would have kicked in.
But that didn’t stop NCL and her travel agent from giving her hope that she could file a successful travel insurance claim.
That left it to me to break the bad news.
Fact: You can’t convert a cruise credit or voucher into a cash refund
When Minor contacted our team for assistance, she wanted to know how she could gather all the documentation needed to file her travel insurance claim.
I’m missing several necessary documents to file this claim — including the terms of the cruise cancellation. How do I get this information? Norwegian says to get it from my travel agent. My travel agent says to get it from NCL. It’s very frustrating!
It was about to become even more frustrating for Minor.
I explained why the travel insurance claim would not be successful even if she collected all the documents.
But then Minor had another idea that she hoped would lead to a refund.
“Do I need to book another trip with my cruise credits and then cancel to get a refund?” Minor asked.
This strategy is one that many passengers have asked about, but similarly not one that will lead to a refund. I explained to Minor why rebooking and canceling would not result in a cash refund.
If you book another cruise and cancel, you will still have paid for that cruise with a voucher. So you will not be owed a cash refund in that circumstance either. There is no way to convert a cruise credit or voucher into a cash refund at this time. I’m really sorry I don’t have better news for you. (Michelle Couch-Friedman)
The Elliott Advocacy team’s goal is to help everyone
Our team makes an effort to help every consumer who contacts us in whatever way we can. On average, Dwayne, Christopher, and I respond to nearly 1,000 emails per month.
The stories you read about on this site depict just a small portion of the hundreds of pleas for help we receive each week and the guidance we provide to those consumers.
Unfortunately, It’s not uncommon for our team to become the target of a consumer’s anger when we explain why their case is not one we can directly tackle. Christopher wrote about this phenomenon last month.
And earlier this week, a consumer asked our team for help changing the beneficiary on her late mother’s bank account. When I explained that changing legal documents is out of our scope of practice and recommended that she consult with an attorney, she responded swiftly with insults.
What good is your organization? Don’t bother me again and do not use my info for anything else. I think your site IS a scam. And I will review it as such.
FYI: We aren’t lawyers — we’re a consumer advocacy team. We can’t provide legal guidance nor change legal documents. It would be reckless for our team to imply that we could.
But through the insults, we soldier on.
So having just endured the last insulting email, I opened Minor’s final response to me with a bit of trepidation. I was pleasantly relieved to read her answer.
Thank you for your patience and clear explanations regarding my dilemma. This has been a learning experience. I thought I was covering all my bases by buying the insurance. I believe that my travel agents were the ones who dropped the ball. My original travel agent no longer works for the agency. So every time I called with a question, I got someone different.
Anyway, I just wanted to thank you because you’ve been the only one who has given me an explanation instead of just saying it’s not possible but not saying why.
With that, Minor intends to end her battle for a refund for the canceled cruise (for now). She’ll accept her cruise voucher and hope for the best for the second half of 2021 — and keep her eye on the constantly changing pandemic-inspired policies.
*The good news update about NCL future cruise credit and refunds (April update)
Minor didn’t have to wait long for NCL to update its future cruise credit policy. About three weeks after she finally threw in the towel and gave up the fight for either insurance or the cruise line to provide her with a refund, NCL suddenly reversed course. In a press release entitled “You asked. We Heard.” NCL announced that some guests may now qualify to convert their cruise credit to a cash refund under one of the following conditions.
- A guest has been affected by two or more suspensions.
- Guest elected to cancel via our Peace of Mind (POM) policy AND then was affected by at least one additional suspension.
- As of April 5, 2021, a guest has an active and existing reservation for a voyage embarking on or before October 31, 2021, and will not be vaccinated.
- An active and existing FCC is attached to a profile of a guest who has passed away. (NCL’s new cancellation policy as of April 5, 2021)
The policy does not cover all future cruise credit holders though. Passengers should take note of these exclusions.
- The original holder of the FCC transferred it to someone else.
- The current FCC holder is not the original FCC recipient.
- If the passenger filed a credit card dispute for the charges.
- The guest applied the FCC to a current and existing reservation.
- The FCC has been partially applied.
What to do if you have (or are offered) a cruise credit instead of a refund
Don’t despair if you’ve received a future cruise voucher instead of a refund. As NCL’s surprise announcement illustrates, as the pandemic continues to go on, the situation will frequently force cruise lines to update their cancellation and refund policies. It is likely that other cruise lines will follow the lead of NCL. If the pandemic has taught us anything about the travel industry, it’s that everything is subject to change. Here are a few things to keep in mind if you have a cruise credit (or are offered one), but you’re hoping for a full refund instead of that voucher.
- Don’t cancel your cruise first.
The coronavirus has shut down the cruise industry for over a year now. Most passengers scheduled to cruise in 2021 likely paid for those cruises with a voucher issued for a previously canceled voyage. But if you are scheduled for a cruise this year and you did not pay for it with a voucher, make sure not to cancel too soon. Remember, the cruise line will owe you a refund to your original form of payment if it cancels first. The order of cancellation is critical. Even NCL’s new flexible policy will not provide you with a refund if you cancel preemptively. If you’ll receive no benefit from canceling before the cruise line, wait it out.
- Refuse the voucher, take the refund
None of us know when the cruise lines will resume sailing or what kind of restrictions will be in place when that happens. We also don’t know if all the cruise lines will survive the pandemic. A 200 percent bonus to take a voucher instead of a refund is useless if the cruise line goes out of business before you can use it. The cruise industry is in a perilous situation — always refuse a future credit and take the cash refund if you can.
- Find out if you can sell or give your cruise credit to someone else.
We’ve not typically seen cruise lines allow passengers to sell or gift vouchers in the past. But in the second half of 2020, some cruise lines — including NCL — started to allow passengers this possibility. Travelers should check with their cruise line about whether they can recoup their cash by selling their future credit. You may also get this information from your professional travel agent.
- Follow your cruise line’s voucher policy updates.
As the pandemic and its restrictions linger, the cruise lines will continue to update their voucher policies. Enforcement agencies may eventually require the companies to refund your cruise after repeated cancellations. Keep your eye on your cruise line’s website and our article about coronavirus cancellations, which we will regularly update.
- Can you insure it?
Finally, many travelers ask our team if it’s possible to insure their travel credits (in case the cruise line goes bankrupt). This is a complicated situation and you’ll need to speak directly with your insurance provider about it. Whatever answer you get — get it in writing. Remember, you typically have a 10-14 day lookover period after purchasing a travel insurance policy before it becomes nonrefundable. Make sure the contract reflects the coverage you want and need. Otherwise, unfortunately, if it isn’t in the policy, it might only be something said to you by a customer service agent who just wanted to get you out of their hair. (For additional information about finding the best travel insurance for your needs, see Christopher’s Ultimate Guide.)
- Contact the Elliott Advocacy team for help.
During the past year, the rapidly changing situation has led to many refund and billing errors in the travel industry. As Margaret Prendergast did, if you believe that your travel agent made a mistake or that the cruise line issued you a voucher in error for a canceled voyage, contact our team for help. Remember, pandemic or not, the Elliott Advocacy team is always here to help. :). (Michelle Couch-Friedman, Elliott Advocacy)