Dealing with refunds

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Dealing with refunds

We all hope for happy guests, but what if someone wants a refund?

When does a situation call for some form of compensation?

Are there ways of appeasing your guests without refunding them?

Unfortunately there's no 'one size fits all' solution when it comes to offering refunds - each situation needs to be assessed on a case by case basis. However, we'll guide you as much as possible using the pointers below.

The basics

  • In the case of cancellations, have a policy in place that details a time frame for refunds - make this clear in your booking contract.

  • Deal with a complaint as soon as it arises

  • If a refund request relates to a complaint, determine whether or not the problem was within your control

When a refund may be necessary

The following situations illustrate when your guests may have a case for some form of compensation:

  • The problem was brought to your attention promptly but could not be resolved immediately. For example, the air conditioning unit breaks and a replacement cannot be arranged until the following day. In this case, a refund reflecting the time your guests were inconvenienced would be a nice gesture.

  • The problem was evident before your guests arrived and was not fixed. For example, the pool or hot tub are unavailable. In such instances you should contact your guests and inform them as soon as you are made aware. Bear in mind that they may have booked your property because of these facilities and you should compensate them accordingly - perhaps knock a couple of nights off the cost of their stay.

  • The property was not in an acceptable state when your guests arrived. Provided that your guests don't arrive before the requested check-in time, the property should be clean and ready for them. If not, offer a refund equal to your usual cleaning fee.

  • If guests have to vacate your property or you need to cancel their stay for reasons that aren't deemed acts of God, you should consider a full refund and assistance in finding alternative accommodation.

When you're not obliged to offer a refund

If you were not alerted to the problem during the guests' stay and weren't given a chance to rectify it, you shouldn't have to issue a refund. For example:

  • Something breaks but you are only told about it once your guests are back home. Had your guests informed you during their stay, you could have arranged a replacement or had it repaired.

If your guests vacate early due to personal choices:

  • You shouldn't have to refund guests if they leave because they aren't happy with the sleeping arrangements or don't like the view. To avoid this kind of complaint, it's important that you ensure your advert is accurate so that guests know exactly what to expect.

An act of God entirely out of your control:

  • Encourage your guests to take out travel insurance to cover them against floods and other natural disasters. No-one can be held responsible for such events and if your guests have to cancel or cut short their holiday, you are not obliged to offer a refund. Include an act of God clause in your booking contract to protect you in such circumstances.

Other ways of compensating your guests

Sometimes a complaint doesn't warrant a refund, but you can appease unhappy guests by making a gesture of goodwill like those below.

  • A bunch of flowers and a bottle of wine, or a selection of local goodies

  • A discount on a future stay

  • Tickets to a local attraction

  • An extra night or two, if you have availability

  • Restaurant vouchers