Loyalty programs change when members push the limits. Etihad Guest has now drawn a line, but the way it has done so with incredibly punitive cancellation restrictions on award tickets raises important questions.
Etihad Makes Award Cancellation Fees Even Harsher
Etihad Guest has introduced a new and even stricter set of cancellation and change fees on award tickets, making a policy that was already an outlier even more punitive. These new rules apply to tickets issued or reissued as of November 13, 2025 and align award bookings with the fare bundles used for paid tickets. In practice, the rules limit flexibility and create some of the toughest penalties in the industry.
The carrier now processes award refunds by converting the cash portion of a ticket (taxes and fees) into miles at a fixed value of two cents per mile. That means if you cancel an award, even the tax portion may come back as miles instead of cash. Combined with the new penalties, the result can be a significant loss of value for the member.
New Etihad Award Change and Cancellation Fees
| Fare Bundle | More Than 72 Hours Before Departure | Within 72 Hours of Departure |
|---|---|---|
| Value | Changes allowed for AED 600. No cancellations permitted. | No changes permitted. No cancellations permitted. |
| Comfort | Cancellation penalty of 25 percent of miles redeemed. Change fee AED 200. | No changes permitted. No cancellations permitted. |
| Deluxe | Free changes and free cancellations. | No changes permitted. No cancellations permitted. |
Why Etihad Might Be Doing This
There is a practical reason behind Etihad’s move. For years many members have booked awards speculatively. It is common to lock in a business class seat months in advance and then cancel it the moment a first class seat or better option opens elsewhere. That pattern is well known and frequent travelers openly acknowledge doing it (although I will say it is only very rarely something I do).
The new 72-hour cutoff now lands exactly where many programs begin releasing last-minute premium cabin seats. Etihad appears to be addressing this dynamic directly. If canceling close in becomes costly or impossible, the incentive to hold seats speculatively weakens.
In that sense Etihad is trying to protect award inventory for travelers who intend to fly rather than for those who use the program as a way to place soft holds on multiple itineraries.
At least that’s one theory, and I don’t dismiss it…
Why The Policy Still Feels Excessive
Even with that underlying logic, the new rules feel unnecessarily harsh. First the lack of flexibility within 72 hours is far outside industry norms (24 hours is bad enough). Many programs have moved toward making changes easier, not harder, and it’s not like it’s super easy to get these miles in the first place.
Second, converting taxes and fees into miles at a fixed valuation introduces another layer of loss for members who expected a simple refund of at least the out-of-pocket money. It also creates confusion because the cash value of an award (in miles) is not always obvious to the member booking it.
Third, the rigidity of the policy affects travelers who are not gaming the system at all. Illness, changes in work schedules, and family emergencies do not always respect a 72-hour window. A policy that cannot accommodate real-life circumstances risks alienating loyal members…I would hope there is some flexibility.
CONCLUSION
Etihad may have a point in wanting to curb speculative award bookings. The problem is that the new structure goes beyond discouraging gaming and shifts into a level of inflexibility that will frustrate many ordinary travelers. The intent makes sense (even if I think it is spurious because someone else will likely just rebook at the same “saver” price anyway that a speculator was holding) but the execution feels unnecessarily punitive.
Caveat Emptor: I’m avoiding Etihad Guest. How about you?
image: Etihad
Frankly, I hope other airlines do this too. Far too often people (and professional award brokers) block award flights they will never take 365 days out and then either sell them or cancel them. This hurts normal members and the mileage currency.
The problem may be real, but I still find the response disproportionate.
I’ll admit to doing this domestically all the time with AA, as there is zero risk. While watching often for better options or just not taking the trip. Along with booking the cheaper mileage flight while planning on using Same Day Standby to get the better flight at the low rate. I clear 95+% of the time with no issues.
I can see airlines cracking down on it due to the abuse and we have no one but ourselves to blame.
By the way I was shocked yesterday at how empty 2 major AA hubs were. I wonder if the media scared people out of flying with all the horror hype the past month?
Surely the logical thing is what the likes of Virgin do, a small-but-not-trivial fee of e.g. $100 in order to give pax skin in the game without fundamentally altering the flexible nature of the tickets.
So Etihad has started gaming the gamers? Good. Hopefully more airlines will get in on their act.
I’m torn on this because penalties of this magnitude really seem out of line but I’ve read and heard about lots of instances where incredibly selfish people book multiple trips in a redundant fashion, taking away availability from the rest of us. Do I think that there are some ridiculously rare situations where a second booking is prudent, such as your child’s wedding where you absolutely can’t arrive a day or two before? Sure. Unfortunately that’s not the normal situation when people greedily hold space they know they won’t use.
As a result I think that I’d actually rather that airlines reintroduce moderate award cancellation penalties, say $100 per person per ticket. That way there would be far less speculative bookings and more normal people would be able to find award space rather than just the privileged few.