IHG Rolls Out Stricter Cancelation Policy In The Americas

Over the past several weeks we’ve seen both Hilton and Marriott introduce more restrictive cancelation policies for their hotels. The reasoning behind this is that a lot of people cancel trips last minute, so that sometimes causes rooms to be empty that could have otherwise been filled. While hotels oversell, they can’t do so as easily as airlines do, given the challenges associated with “walking” guests. So even when a hotel is sold out for weeks leading up to a date, it’s possible that there are empty rooms in the end due to cancelations. The goal here is to reduce that as much as possible.

The latest hotel chain to introduce a stricter cancelation policy is IHG. As of today (August 4, 2017), flexible rates at IHG properties in the Americas need to be canceled at least 24 hours before arrival to avoid any penalties, including for bookings made on ihg.com. Kimpton properties are excluded from this, and continue to require cancelations 48 hours before arrival. Previously a majority of properties let you cancel until the day of arrival. IHG provides the following reason for this change, per Skift:

“The changes to IHG’s cancellation policy will provide our guests with greater consistency when managing their reservations and offer certainty for our owners. IHG’s previous cancellation policy varied by both region and brand, and this new change will mean that the majority of the IHG estate will now operate under similar terms. Guests will have one day prior to arrival to cancel their reservations without penalty, which still leaves them with 24 hours if they need to cancel their booking.”

This new policy was rolled out in Europe last week, in the Americas this week, and by September they should roll it out in Africa, Asia, and the Middle East, with the exception of China. I suspect China is an exception since it’s still such a growing market and occupancy rates in many cities aren’t that high yet, so they don’t deal with the same challenge of lost revenue due to last minute cancelations.

The good news is that IHG’s new policy is significantly less restrictive than that of Hilton and Marriott. With Hilton and Marriott’s latest changes, 48-72 hours advance notice is required for cancelation. So canceling the day before seems reasonable by comparison.

I imagine at some point IHG will even make their cancelation policy more restrictive, to match the competition.

What do you make of IHG switching to a 24 hour notice cancelation policy?

Comments

  1. Does anyone have an idea of what the late cancellation rate is at these large hotel chains? Nearly all my late cancellations have been a direct result of cancelled flights due to weather or other air travel issues and they always fall within the 24 hour window. So, nothing has changed for me – I never have enough time to cancel without penalty.

  2. @ Ben — I thought that Flex Rates already had 24 hour cancel policy at IHG. We stay >100 nights, so I’m pretty sure. Maybe I’m just imagining…

  3. I think that the other aspect of it is that they can now offer cheap rates the night before without fear of existing guests taking advantage of it. This week at Hyatt Regency Embarcadero is SF, the rate dropped to $100 less the night before my check in, but cancellation was 72 hours.

  4. I agree with beach fan. This has NOTHING to do with the poor hotels loosing money. It has everything to do with them further being able to manipulate prices. As someone who spends about 150 mights in hotels, I have decided – at least in the US – to forgo the stupidity of being an elite member and just book the night before. The Ritz has no availability? Ill try Hyatt, Hilton, SPG, Etc until I get a room. Im not playing the stupid game anymore so they can give me a complimentary glass of disgusting old OJ and a stale muffin. Im successful enough to buy my own breakfast.

  5. oh IHG, so unappealing, with such lousy elite status, yet so reasonable…i suppose i’ll always need you.

  6. This is reasonable, unlike the what 72 hours that Marriott rolled out. IHG used to allow me to cancel up until 6 p.m. on the day of the reservation. That was generous.

  7. I am constantly traveling for work. I gave up on Marriott some time ago and about the time I was lifetime Plat with them. They didn’t have a lot of hotels where I happened to be working but IHG had good coverage.

    Imagine my surprise when even at lowly gold with IHG, I got better AND more frequent upgrades than I did with Marriott. Final straw for me with Marriott was when I went to Paris and stayed at their property on Champs de Elysee on points. They stuck me in a crappy room overlooking the dumpster in the back and the internet didn’t work. I had been in their platinum premier level (top 2-3% of all guests for years) and never really felt valued there.

    Suffice to say I bailed out and booked something with IHG (on points) about a block away. I was still only gold with them and my first few months of staying with them. They gave me a very nice room, bottle of wine, strawberries dipped in chocolate and a fruit and cheese plate. They took far better care of my wife and I than Marriott ever did. Since then I’ve been pretty much with IHG ever since and have racked up about 1000 nights in the last 4 years. The change in Marriott’s cancellation policy just kept me even further away from coming back to them.

    This change in cancellation policy will definitely affect me. Too often I am delayed because of my flights. I have found though that even with IHG hotels with a much more strict cancellation policy that they have been flexible due to my status with respect to almost last minute cancellations. I rarely had that kind of experience with Marriott. I have never abused it and try and call as early as I can. Of course YMMV.

  8. Does this change in cancellation policy only apply to new reservations? Does it apply to existing reservations?

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