Airlines Are Increasingly Using Vouchers Over Cash — Here Are The Secrets For How To Use Them

On Thursday, a United Airlines passenger received $10,000 after being bumped from a flight. Contrary to some reports, this was in the form of a voucher and not cash.

Vouchers are nothing new. We hear about them all the time, especially if a flight is oversold or when something goes wrong.

And they’re usually used as compensation in place of cold, hard cash.

In fact, airlines make it clear these vouchers have no cash value.

“Airlines give you these vouchers to achieve two things: Solve their problem, such as an overbooked flight, and have you go away,” travel industry analyst Henry Harteveldt told Business Insider.

However, the terms and conditions that govern what you can do with these vouchers vary greatly based on the type of certificate you were given and the airline you are flying.

So it’s important you not only negotiate for the highest amount possible but also get clear answers on the terms of use before accepting them.

Here are a couple of things to pay attention to.

Which airlines you can fly

First, there are restrictions on which airlines you can fly.

These days, major airlines such as American, Delta, and United, are all members of global airline alliances. As a result, these airlines can sell tickets on flights operated by their alliance partners.

For instance, United, as a member of Star Alliance, routinely sells tickets on its website for flights operated by alliance partner Lufthansa. Unfortunately, these tickets are not eligible for voucher holders.

“Electronic travel certificates (vouchers) can be used for travel on United and United Express-operated flights,” a United spokesman told Business Insider in an email. “Certificates are not valid for travel on Star Alliance flights or United-marketed flights operated by other airlines.”

Conversely, American Airlines will allow you to use vouchers for flights operated by its Oneworld alliance and AA codeshare partners.

Airlines can also restrict where you can redeem the vouchers. Some vouchers stipulate that they cannot be redeemed at third-party travel agents and websites.

Where it will allow you to go

In addition, the voucher might not be able to take you everywhere you want to go. That’s because airlines may place restrictions on destinations or point of origin.

For example, the terms of American Airlines eVouchers clearly state that it’s valid for “flights operated by American Airlines and the American Eagle carriers for itineraries sold and originating in the U.S., Puerto Rico and U.S. Virgin Islands.”

Even more interesting is the fact that “flights sold or originating outside the U.S., Puerto Rico or U.S. Virgin Islands or operated by other carriers are not eligible.”

So if you happen to be in Spain and want to use your voucher to pay for a flight back to the US, you’re out of luck.

What it will pay for

The extent to which a voucher will cover the cost of a ticket varies.

For example, Southwest Airlines’ LUV Vouchers can only be used as a form of payment towards the cost of airfare. The passenger is on the hook for any additional government-imposed taxes or fees, which, in some cases, can cost as much as the airfare itself.

On the other hand, Delta Air Lines’ transportation credit vouchers and American eVouchers can be used to cover both the cost of the airfare and any associated fees or taxes.

Can I give it to someone else?

Sometimes you can even use the value of the voucher on someone else. According to Southwest, its LUV Vouchers are fully transferable.

Delta Air Lines vouchers are transferable, but with some caveats.

For certificates issued before December 15, 2011, Delta will allow you to transfer the voucher to another passenger by simply giving that person the 13-digit voucher number and the name to whom the voucher was issued.

For certificates issued on or after December 15, 2011, the value on the voucher can be applied to a different passenger as long as the person to whom the voucher was issued is traveling on the same reservation.

Unfortunately, American Airlines eVouchers are non-transferable.

However, even fully transferable vouchers can’t be sold. In fact, selling or bartering away your voucher will almost certainly cause them to become void.

Can I combine more than one voucher?

Instead of a $1,000 voucher, sometimes an airline may choose to give you two $500 vouchers. Don’t worry — many airlines will allow you to combine multiple vouchers.

American, for example, will allow you to combine up to eight vouchers to pay for a single ticket.

Last but not least, look at the expiration date

Most airline vouchers are valid for one year after its issuance. However, this can vary, so pay attention to its expiration date.