United Airline’s Turn to Offer $10,000 to Bumped Passengers

In response to the the incident of forcibly removing a passenger off one of their flights, United Airlines has also (started with Delta Air Lines) adopted a higher offer to bumped passengers. Passengers can now receive up to $10,000 of compensation (travel credit to be used on United Airlines flights).

Once again, I do question the profitability of this move. An interesting stat in the article states:

• United said it typically overbooks flights by less than 3 percent of the plane’s capacity to account for no-shows, and it sells more tickets than seats available on about 4 percent of flights. But on mainline United flights, 95.6 percent of bumped customers volunteered. Fewer than 1 in 23,000 customers were involuntarily bumped last year, down 44 percent from 2015, United said.

$10,000 Compensation to Bumped Passengers

In addition to the factors that I brought last time, I suspect that this $10,000 compensation package is more of a nice publicity stunt. What I think will more likely happen is that airlines will reduce their overbooking. If United overbooks their flights by less than 3% at the moment, they may drop that to 2% instead. That should offset the additional compensation packages that they pay out.

Either way, my point is that airlines will have a plan to make up the loss profits. For now, I appreciate this move by United Airlines. Any incentive to make it easier for more volunteers to come forward will probably help the overall travel experience.

$1,500 for a Lost Luggage

United also plans to reimburse passengers $1,500 for a permanently lost luggage. The passenger also has the option of applying for more reimbursement, if the contents inside the luggage is worth more than $1,500, but proof will be required for these larger claims.