Airlines must pay more for lost bags and bumped fliers

The maximum that airlines must pay for a lost bag increases by $100 on Aug. 25

Inflation is no fun when it increases your everyday expenses. The good news is that rising inflation means that airlines must pay you more for losing your luggage or bumping you from your seat.

To keep up with inflation, the U.S. Department of Transportation recently announced that it was raising the maximum that carriers must pay passengers whose bags are lost or damaged. The top payout will increase to $3,500 from $3,400 on domestic flights.

If you buy an airline ticket but get bumped because the carrier overbooked your flight, you are owed $675 to $1,350, depending on the price of your ticket. That is an increase from the previous range of $650 to $1,300.

In addition, if an airline violates a consumer protection rule, such as false price advertising, the Department of Transportation can fine it up to $2,750 a violation, up from the current maximum fine of $2,500.

The new rates take effect Aug. 25.

To read more about travel, tourism and the airline industry, follow me on Twitter at @hugomartin.

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