What’s with the non refundable deposits

[dianfarmer]

My husband and I have been cruising for many years. Both of us in our 70’s. In the past your deposit was refundable as long as you canceled before final payment. Now you have to pay a lot more for a refundable deposit if it’s even an option. When you are our age a lot can happen between deposit and final payments. This is not good. They want people to book a year in advance but who wants to loose a deposit

[CruisingAlong4Now]

Too many people booking multiple cruises and then cancelling without any penalties are responsible for this. Why not book everything and make a final decision right before payment?

 

Insurance will solve your problem, especially CFAR.

[dianfarmer]

You must purchase trip insurance within 2 was of deposit for it to cover pre existing conditions. If you happen to have to cancel before final is due, not only do you loose the deposit but also the premium for the insurance you purchased. That’s a lot of money

[Spudd]

Not all cruise lines have gone this way. Princess and Norwegian are still doing refundable deposits without a big increase. 

[Hlitner]

We started hearing some rumbling about this more than a decade ago while on a HAL cruise.  Apparently, there are many folks who routinely book mulitple cruises (sometimes for the same time period) with no intention of taking most of those bookings.  Why not?  They can book 10, 15 or 20 cruises with relatively low deposits and block out their favorite cabin/suite locations.  Then, as they near the final payment time they simply cancel the booking for which they have no interest.  

 

The problem is that when folks do all these faux bookings, they pull their selected cabins out of inventory.  This negatively impacts many others, who are serious about a booking and cannot get desirable cabins or any cabin (if the cruise is sold out).  We were told there are two ways to deal with this problem one of which is to increase deposits (some luxury lines have large deposit requirements) or keep lower deposits but make them non-refundable.  Some lines offer multiple options so folks might be able to get a lower price if they make a non-refundable deposit or pay more for the cruise with a refundable deposit.  

 

By the way, you will also see some changes in the hotel industry.  The old model where you could make bookings (with no deposit) and cancel up until the day of arrival have been disappearing.  These days it is more common to pay more for refundable deposits and also require that cancelations be made several days (or even weeks) in advance.  Lately we have noticed that mental rental car companies now offer lower rates for those who are willing to either prepay or provide non-refundable deposits.

 

As a couple also in our 70s, we support these changes in the cruise industry.  We rarely cancel a booking, and do like the ability to have a larger cabin inventory from which to choose, when we do book.  If we are not sure about a cruise we generally do not book.  Folks that are concerned about situations that might later force them to cancel (such as health issues) always have the option or purchasing various types of travel insurance including "cancel for any reason" waivers.

 

Hank

[leaveitallbehind]

As @Hlitner alludes, the option for a non-refundable v refundable deposit occurred with many cruise lines as a result of many bookings made that were changed or cancelled altogether prior to final payment.  Industry data a few years back indicated that the typical stateroom is booked and rebooked 8 times before being secured with a final payment.  And the statistic for suites - which on most cruise lines are few in relationship to standard staterooms - was even higher.

 

In order to try to reduce this revolving door of stateroom inventory fluctuation, the non-refundable deposit was introduced, supposedly at a lower fare. This, at least in our experience, was not the reality.  We had several reservations booked at the time and when the "lower rate NRD" fares were introduced and we did mock bookings on each one with the result that the NRD fares were now about the same as our original refundable fares, and the refundable fares were considerably higher.  So in reality, at the time, it also served as a price increase tool.  Of course today there is a measurably lower NRD v refundable fare difference.

 

But with those NRD fares came penalties for changing or canceling a booking made that way.  Originally it typically was a fee with the balance held as an FCC.  Now many have moved to the full deposit amount being forfeited with no FCC value.

 

And suites with many are only available with a NRD with higher proportionate deposits. 

As a way around this, there are cruise lines that allow you to convert a refundable deposit to a NRD fare at the then prevailing fare just prior to final payment.  Even if fares have increased since your original deposit, the NRD fares are typically still lower than the original refundable fare - at least in our experience.

 

So there it is in a nutshell.  And by the way, you must not have booked a cruise for quite some time or your cruise line of choice is late to the party, as in our experience this all went into effect 3 or 4 years or so pre-pandemic.

 

 

Edited February 5 by leaveitallbehind

[leaveitallbehind]

1 hour ago, dianfarmer said:

You must purchase trip insurance within 2 was of deposit for it to cover pre existing conditions. If you happen to have to cancel before final is due, not only do you loose the deposit but also the premium for the insurance you purchased. That’s a lot of money

Maybe I'm missing something because I'm not sure I'm following this.  If you have to cancel pre-final payment, would the insurance not cover the deposit hence justifying making a cancelation claim?   And you would lose the insurance premium anyway as by making a claim you are activating the coverage, but at least you would recover your deposit versus losing both.  If I'm not seeing this right, please clarify.

 

Also, see my response on your duplicate thread with information regarding non-refundable deposits.  And BTW, non-refundable deposits are nothing new and have been in effect with many cruise lines for a number of years.  It is just part of the current cruising world.

[navybankerteacher]

When you book a cruise you are taking a cabin off the market - you are getting something which may have value for you, particularly if due to demand the fares go up.   Of course if fares go down you would like to be able to forget (cancel) that booking and book another one.

 

Please explain why you think you should be able to get that valuable option for nothing?   

[VMax1700]

Refundable deposit??? 🤣🤣

Try that one in Europe. Here deposit is part of the contract and if you cancel then you lose the deposit.  Deposit is usually 15% of the booking price.

[Hlitner]

13 hours ago, Spudd said:

Not all cruise lines have gone this way. Princess and Norwegian are still doing refundable deposits without a big increase. 

Like many things in business, the cruise lines will generally do what is best for them.  Lines that are very popular (with lots of long term bookings) tend to have different strategies then lines that primarily deal with the shorter term ( less than 2 week) cruises.  And even in the shorter cruise market, non-refundable deposits are sometimes used as a strategy.  A good example would be MSC who has, on some of their ships, a ship within a ship concept called the Yacht Club,  The Yacht Club is only about 5% of the ship and is actually an enclave with its own decks, restaurants, pool, etc.  It costs a lot more money then most outside the YC, and has proven very popular.  It is not uncommon for YC suites to be sold out more than a year in advance while there are hundreds/thousands or remaining cabins outside the YC.  So MSC has now made the deposits on YC suites, non-refundable, while deposits on the remainder of the ship are refundable.  They simply want to discourage folks from holding YC Suites and keeping them out of available itinerary.  Those of us who happily book the YC are generally fine with this policiy since it helps keep some of those suites on the market for folks who are serious about taking the cruises.

 

Hank

[leaveitallbehind]

13 minutes ago, Hlitner said:

So MSC has now made the deposits on YC suites, non-refundable, while deposits on the remainder of the ship are refundable.  They simply want to discourage folks from holding YC Suites and keeping them out of available itinerary. 

Just to echo your comments, as I mentioned in a prior post, this has become a rather common practice amongst a number of cruise lines.  RCCL / Celebrity, as examples, initiated this with suite bookings when they introduced the NRD a number of years back. 

 

The policy has continued to morph over time to the point where suites can now only be booked via NRD with increased deposit amounts and 100% deposit forfeiture for changes or cancelations.  As this is the only way they can be booked there is no discount for this v refundable deposit bookings and the prices, as expected, are certainly at a premium.  Yet bookings continue to flourish with suites typically selling out first and well in advance of a given itinerary's sailing date.

 

As a result, IMO the desired effect of inventory stabilization with, at least, suite bookings certainly must have been realized with these two lines.

Edited February 5 by leaveitallbehind

[mammajamma2013]

16 hours ago, Spudd said:

Not all cruise lines have gone this way. Princess and Norwegian are still doing refundable deposits without a big increase. 

Princess offers a refundable deposit if you book the Princess Plus or higher option. Basic fare is non-refundable deposit.

 

I prefer the basic fare, my husband doesn't drink and I drink very little. Wifi isn't important to us, so the gratuities are generally all we consider a must-pay; basic fare works best for us.

Edited February 5 by mammajamma2013
added a thought

[ldubs]

1 hour ago, mammajamma2013 said:

Princess offers a refundable deposit if you book the Princess Plus or higher option. Basic fare is non-refundable deposit.

 

I prefer the basic fare, my husband doesn't drink and I drink very little. Wifi isn't important to us, so the gratuities are generally all we consider a must-pay; basic fare works best for us.

 

OK, I acknowledge I'm no where near an expert.   We booked recent refundable deposit Princess cruises without any packages.  In fact we sadly had to cancel one (and got a full refund).  

[John Bull]

As @VMax1700's response, what you're now faced with is what has always been the norm. for hotels in the UK and most (all?) of Europe. A deposit actually means something, the right to a full refund can be abused.

And for UK cruisers as well as their deposit being at risk from the moment it's handed over, unless they cancel early enough they can also be held liable for the entire cruise fee - even if it hasn't yet  been paid.

 

On road trips in the US sometimes we'd find it useful  book two or three hotels in different locations - without risking our payment - so that our timetabling wasn't too rigid. Some would consider that as  abuse of the system. It's not something we could do at that time in Europe.

 

But for a number of years now, in Europe and the United States and elsewhere we have been seeing the majority of hotels quoting two prices - one with cancellation rights, and a lower one where payment  is non-refundable. That allows us to choose between the safety of free cancellation or for a discount taking the risk of  some uninsured calamity. 

 

In time, I guess UK cruise lines will follow the others with those two alternative prices.

 

JB 🙂

[mammajamma2013]

On 2/5/2024 at 10:08 AM, ldubs said:

 

OK, I acknowledge I'm no where near an expert.   We booked recent refundable deposit Princess cruises without any packages.  In fact we sadly had to cancel one (and got a full refund).  

Hmm. That's interesting. Recently whenever I've been looking, I've been seeing non-refundable deposits on basic. Maybe it's because of the ones I'm interested in booking.

 

So YMMV certainly applies here!

[ldubs]

2 minutes ago, mammajamma2013 said:

Hmm. That's interesting. Recently whenever I've been looking, I've been seeing non-refundable deposits on basic. Maybe it's because of the ones I'm interested in booking.

 

So YMMV certainly applies here!

 

I cannot explain and I don't do the bookings.  Before posting I did confirm with Mrs Ldubs that we got the full refund.  BTW, this cancelled cruise was the first time we had used Princess EZ Air.   So, we didn't have to deal with cancelling a prepaid airfare.  

[leaveitallbehind]

46 minutes ago, ldubs said:

 

BTW, this cancelled cruise was the first time we had used Princess EZ Air.   So, we didn't have to deal with cancelling a prepaid airfare.  

Just as a side note, Princess has one of the better air programs with flexibility of flight changes, air points application, and delayed payment.  RCCL / Celebrity is also very good in the same regards, although they do not process air points towards their bookings.  However, they often are very competitive with international fares.  We use them frequently with our cruise bookings as a result with very good success.