Written By: Craig Satterfield, CLIA ECCS
No travel professional can deny that we are seeing more non-refundable deposit cruise fares.
In the past, deposits could be made on cruises years in advance knowing that you could always cancel or reschedule your cruise to a different date or different ship in the fleet if schedules changed without losing any money. Today, booking a non-refundable deposit cruise can put a Monkey Wrench in your plans if they need to change.
It started in 2009 with Carnival Cruise Lines, who offered their Early Saver Fare. This was the lowest priced cruise for the line except for last-minute Flash Fares or Interline Fares. Early Saver dictated a non-refundable deposit but also offered some extra benefits besides the lower price. Carnival would guarantee that this fare would continue to offer the lowest prices as time went on and had offers to adjust pricing down, as long as you submit a form proving a lower fare. If the guest did cancel prior to final payment, the amount of the deposit would be put in his past passenger account for future travel less a $50 per person fee. At the time Carnival was following a similar program that is offered at Southwest Airlines (except for the $50 fee that is). Much of the time the deposit would not be much more than the amount of the fee so the funds you were able to reuse for a future cruise are minimal.
Now these non-refundables are in the pricing grid with the major mass market cruise lines. Unfortunately, the rules are inconsistent from cruise line to cruise line. You need to watch yourself when offering them to avoid shooting yourself in the foot. Make sure that you tell your guests from the first breath that these fares are based upon non-refundable deposits and that is why the prices are lower. On the paperwork plaster that fact all over it in at least two places. This is a good place to also offer the travel insurance that you sell. Also remind them that there cannot be any name changes or substitutions of any kind.
I use these non-refundable fares to actually promote the idea of the guest purchasing travel insurance. In some instances, the amount of savings on the lower fare will finance travel insurance. In researching the standard discounted fare and the non-refundable fare for a 7-night mid ship balcony cabin, I found there was a savings of $200 per person in price. This should be enough to purchase a decent insurance policy. If you sell third party insurance policies than this will happily increase your commissions.
A word of caution. Don’t assume that Best Fare pricing on many of the booking engines is a standard refundable fare, in most cases they are not and the rules could escape your notice.
The thinking of cruise lines regarding these more restricted fares does have a basis in fact. They have found the guests might reserve and deposit several cruises on several lines while they decide on which one they really want to take, then cancel the loosing ones before final payment. This ties up inventory they could have sold as well as increase the workload of travel professionals making the bookings. These multi booking guests have also used different agents for each of the reservations they have made for around the same sailing dates! They would be taking advantage of using lower fared early booking prices and then making the decision on which cruise 90 days before the sailing date when final payment is due.
The lines feel clients that book with non-refundable fares are more committed and the possibility of cancellation goes down tremendously. For us it helps since we don’t have to spend time repricing and changing the existing refundable bookings to keep the clients happy while sacrificing our hard-earned commissions.
As of this writing, here is a simple list of lines with non-refundable fares and their rules:
Royal Caribbean Cruise Lines
They offer these fares on all sailings and categories. These fares have reduced deposits from time to time but normally they are the standard amount. Don’t forget at one time RCI offered some on board credit for these fares but NO MORE. The internet is filled with outdated information. I have seen a difference in fare between standard and non-fundable fares of $600 per person for a standard balcony cabin on Oasis class ships. It looks like Royal Caribbean means business with these restricted prices! The fee to rebook before final payment is $100.00 per person which is taken out of the original deposit. The balance is held in the guest’s past passenger account for future travel.
Carnival Cruise Lines
The line that started it all. Most of us are familiar with their Early Saver fare and offers the best fares, fare protection if the prices go down and a $50 per person fee.
They have been recently been re-marketing these fees a lot more lately. On these fees be sure to watch how many and which perks come with the fares. You don’t want to oversell and under deliver since an error like that could come right out of your pocket to make it right. Their fee to rebook is also $100.00, same as Royal Caribbean.
Holland America Line
HAL has been offering these fares for about 2 years now. Unlike Carnival, they do not protect prices if the fares go down, but you can call them and ask them to add amenities to try and make up for the difference in fare. They can add drink credit cards, shore excursion credit cards, dinners in Pinnacle and Canaletto’s and other amenities to try and help you out. What is nice about this is that you are not sacrificing your commission for a lower fare.
Be sure to price out the non-refundable fares and compare them with the past passenger rates if they are Captain’s Circle members. Many times, the fares are the same as the non-refundable ones and they are refundable. This can be a great selling point to let your guest know that you have the very best price which could be cancelled if necessary.
Norwegian Cruise Lines
NCL currently does not have non-refundable fares with certain exceptions. Make sure if you book any Haven Suites that you advise your guests of a tighter cancellation policy.
Disney Cruise Lines
Disney advises that all Suites and Concierge Class cabins have a non-refundable deposit for various holiday sailings. Standard cabins have a traditional cancellation policy.
Cunard is not offering fully non-refundable fares. Generally, they are offered after the final payment due date so they would be in penalty anyway.
They have a different spin on this. The standard reservations have a standard cancellation penalty after final payment but if you purchase their “Cruise Again” future cruise credit, there are some non-refundable issues that should be check into.
We will most likely start seeing other lines jumping on the non-refundable deposit parade. Depending on how you look at them, and how you related them to your guests, they can be a blessing or a curse. Be straightforward about the benefits of non-refundable deposits, especially for those guests that are not strongly considering travel insurance.