Luggage hero
23 February 2015

Airlines limit pay-outs for lost luggage

Convention sets maximum amount an airline has to pay.

Alan MacKinven and his partner had a 2-day wait for their bags after flying to Brazil with LAN Airlines. Norma waited 7 days for her luggage to turn up when she flew to the UK with Air New Zealand. It took numerous calls to the airline before her suitcase was eventually returned.

Lost luggage is a common cause of complaint for air passengers, says our consumer adviser Maggie Edwards.

“It’s not only frustrating but can also be costly if you have to buy replacement items,” she says.

Airlines are responsible for the bags they allow you to check in. But their liability is limited under the Montreal Convention, an international agreement on air carriage.

The convention sets out the maximum amount an airline has to pay if your luggage is lost, damaged or delayed on an international flight. Per passenger, the sum is about $2300. It’s reviewed every 5 years.

If your luggage is delayed, the compensation provided by the airline is usually limited to expenses for essential items. Airlines don’t generally accept any liability for inconvenience, stress or consequential losses.

After Norma complained to Air New Zealand, the company apologised for the service it had provided. It also offered her $300 cash and 150 airpoints, an amount she considered insufficient for the 7-day delay.

LAN Airlines offered Alan and his partner US$700 in airline vouchers or US$350 cash. The figure also included compensation for an overnight delay in their flight leaving Auckland that meant a planned stopover in Santiago was cut short. The couple opted for the cash but are still waiting to be paid.

Baggage claim

If your luggage is damaged or delayed on an international flight, contact the airline as soon as possible.

To claim compensation for damage under the Montreal Convention, you must write to the airline within 7 days of getting your bags back. For delays, you must make your claim within 21 days.

When you’re flying domestically, your rights are set out in the Contract and Commercial Law Act. Under the Act, the airline is liable for loss or damage up to $2000.

The amount you receive won’t necessarily cover the full cost of replacing your items and you may have to claim on insurance.

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