I recently covered how Etihad Guest has updated its award change and cancellation policy yet again. The program has the most punitive award ticket cancellation policy of any airline in the industry, and within 72 hours of departure, no changes or cancellations are possible to award tickets.
As it turns out, the policy is actually even worse than I fully realized, and reader Ryan shared his experience with me.
In this post:
The confusing way Etihad Guest allows award cancellations
I won’t recap Etihad Guest’s entire award ticket cancellation policy, so see my previous post for those details. So let me explain what makes Etihad’s policy kind of ridiculous, in the form of an example.
Let’s say that you book an Etihad Guest first class award ticket in the “Comfort” fare bundle from Toronto (YYZ) to Abu Dhabi (AUH), which costs 200,000 miles one-way, and comes with around $600 in taxes and carrier imposed surcharges. If you needed to cancel at least 72 hours before departure, you’d have to pay a 25% fee to redeposit your miles.
Okay, so how much would you expect that you’d get back? Most people would generally assume that you’d forfeit 50,000 miles (so you’d get 150,000 miles back), and then you’d be refunded the $600 in taxes and fees. Oh, if only that were how it worked!
Etihad Guest instead uses a really convoluted system. For one, the percentage redeposit fee also applies to any carrier imposed fees paid for in cash. Furthermore, Etihad Guest refunds you as much as possible in miles rather than cash, and values each mile at two cents each (also the cost at which Etihad Guest sells miles, before any discounts).
There are two ways you can do the math on this:
- Etihad Guest essentially “values” the ticket at $4,600 ($4,000 worth of miles plus $600 in taxes and fees), so you’re owed a refund equivalent to $3,450; at a rate of two cents per mile, that means you’d receive a refund of 172,500 miles, and then the airline keeps your $600 in cash
- Put another way, you’re also paying the 25% fee on the taxes and fees you pay; so you’d get 150,000 of the 200,000 miles redeemed back, and then you’d get back $450 worth of the $600 in taxes and fees, but that’s converted into miles at the rate of two cents per mile, so you’d get back 22,500 miles in lieu of cash
This makes a very bad policy even worse
It’s no secret that I’m very critical of Etihad Guest’s cancellation policy. In theory I understand how Etihad Guest wants to align policies on revenue and award tickets, but this is simply uncompetitive, in an industry where most airlines charge virtually nothing for canceling award tickets.
I find it frustrating to begin with that tickets can’t be changed at all within 72 hours of departure, and that even if you’re canceling an award 10 months out, you’ll often be on the hook for 25% of the ticket cost.
But what I find even wilder is that even the cash portion of the ticket is subject to that 25% fee, and that cash refunds are arbitrarily converted into mileage refunds, at an unfavorable rate no less.
Ultimately Etihad Guest has the right to set its own policy, and everyone can decide for themselves what to do with that information (though I think Etihad Guest could be a bit more transparent about its policy). Personally, this makes me avoid the program, and I find this to be highly uncompetitive. As a point of comparison, Emirates Skywards lets you redeposit Flex Plus awards at no cost (and all first class awards book into that fare bundle).
Bottom line
Etihad Guest has the industry’s most restrictive cancellation policy for award tickets. Not only are no changes or cancellations allowed within 72 hours of departure, but further out than that, you often have to forfeit a significant percentage (typically 25%) of the ticket cost.
What’s worst is that the 25% fee doesn’t just apply to the miles, but also to the cash paid. And then Etihad has a confusing system by which it converts cash into miles, so that you typically don’t get any of your carrier imposed fees back, but instead, get those back in miles, at an unfavorable rate.
So if you are booking an award through Etihad Guest, make sure you know what you’re getting yourself into…
What do you make of the Etihad Guest award ticket cancellation policy?
Points lead to petulance, petulance leads to lots of toys being thrown from your pram …. mummy will not be pleased children.
However, there is a very simple solution folks …. prior preparation and planning, prevents p*ss poor performance. It’s a pity that so many fail to plan and then wonder why the plan fails …. :-(
Afterthought ….
I invite a person to my home and they become my “Guest”.
I book...
Points lead to petulance, petulance leads to lots of toys being thrown from your pram …. mummy will not be pleased children.
However, there is a very simple solution folks …. prior preparation and planning, prevents p*ss poor performance. It’s a pity that so many fail to plan and then wonder why the plan fails …. :-(
Afterthought ….
I invite a person to my home and they become my “Guest”.
I book into an hotel and I become a “Guest” at that hotel.
When Eskimo books an appointment to see his shrink, he becomes a patient.
When Ben books an airline ticket he becomes a customer of the operator, not a “Guest”.
I wouldn't have a problem with this so much if EY valued the points based on THEIR cost, not the "retail price" of the points. They may value the points at two cents and sell them for two cents, but I'm assuming their cost would be much less.
They're screwing you twice: taking a 25% cut of your cash for themselves, then decreasing the cost to them even further by giving you points they've marked up by, what, 2x or so?
I like this policy. Prevents or makes people think before making a speculative booking with miles for the purposes of abusing the generous cancelation policy. Cancelation policies and return policies are changing worldwide.
It has to be widely known by consumers to reduce speculative bookings. So far, that's clearly not the case.
Therefore, the bottom line with EY tickets is: pay with points and accept the penalties for procrastinating, yes?
Legal or not, Jetblue does it, have lost several hundred dollars over the last few years of taxes for flights never taken.
Just because you didn't ask for it back mean JetBlue wouldn't refund you or make it easy for you to get it back.
I’m sure this is illegal in many countries where you must get back taxes in cash (!).
Even when a ticket is “non-refundable” airlines typically must refund government taxes and airport fees that apply only if you actually fly.
These often include:
Passenger service charges
Security fees
Airport improvement fees
Air passenger duty (e.g., UK APD)
Boarding fees or transportation taxes
Because you never flew, the airline never had...
I’m sure this is illegal in many countries where you must get back taxes in cash (!).
Even when a ticket is “non-refundable” airlines typically must refund government taxes and airport fees that apply only if you actually fly.
These often include:
Passenger service charges
Security fees
Airport improvement fees
Air passenger duty (e.g., UK APD)
Boarding fees or transportation taxes
Because you never flew, the airline never had to remit these charges to the government.
That's what I thought, too
BTW, to follow on my last post- during phone call with Etihad as husband was thinking of cancelling- they couldn’t say exactly how much in miles or cash would be refunded. They said that another department would handle that. So basically, no way of knowing what the actual penalty is- before deciding if we really wanted to cancel or not.
Same as my experience.
And it’s weeks before you get the miles back.
I wanted to change my return leg from J to F because saver F space opened up. Impossible to do unless you already have a ton of miles or want to tranfer more points to Etihad Guest and be left with the refunded miles that will expire.
First time flying Etihad F in Feb for my outbound leg. I hope...
Same as my experience.
And it’s weeks before you get the miles back.
I wanted to change my return leg from J to F because saver F space opened up. Impossible to do unless you already have a ton of miles or want to tranfer more points to Etihad Guest and be left with the refunded miles that will expire.
First time flying Etihad F in Feb for my outbound leg. I hope the F experience is worth all this nonsense because as of right now I have no intention of using Etihad Guest ever again.
So stop flying with them and stop posting about them
Our experience was even more punitive. Husband paid 120,000 miles and AED 2440 for AUH JFK in Business.
When they moved the A380 to YYZ, husband cancelled the JFK flight in order to catch the A380 via YYZ.
He got entire 120,000 miles back. But he only got AED 400 back. So 83.6% penalty in the cash portion.
I’m curious about that. I always thought on what were considered non refundable fares that the standard was that taxes are always refundable, though often on request. I believe the reason is to avoid any future regulatory enforcement of Governments deciding to require it automatically without request. This way they at least make you submit a request which I’m sure many don’t. The reality is that the service was never performed and the airline will...
I’m curious about that. I always thought on what were considered non refundable fares that the standard was that taxes are always refundable, though often on request. I believe the reason is to avoid any future regulatory enforcement of Governments deciding to require it automatically without request. This way they at least make you submit a request which I’m sure many don’t. The reality is that the service was never performed and the airline will not pay the taxes. Therefore the customer should not be required to pay taxes on a service that never took place. Otherwise this is double dipping and the airline just keeps these “taxes.”
I’m actually not sure this is legal in the US (and I assume other countries) at least with respect to the taxes portion, as my understanding is that even for refundable tickets, if the ticket is not flown (and the taxes therefore not paid), the consumer is entitled to a refund.
do you mean 'non'-refundable?
Nah, it’s legal. Just look at basic economy fares. You don’t get a dime back to your original form of payment. You might get some pity credits.
I believe that technically you can demand a refund of certain taxes, even on basic economy tickets, though you have to forfeit the fare to do so. So yes, I'd agree that technically this may be illegal in some jurisdictions.
I think the most important piece that is missing is exact breakdown of tax and fees.
Things like 9/11 security fee should be 100% refundable since the airline is collecting for the government and is not actually due until flown.
How is that any helpful if you have to forfeit the fare in the case of points? So you either get $600 dollars back and forfeit 140k+ points or take the hit from Etihad's cancellation policy.