Miles to go: when an airline goes bust, do your points take flight?

Entrepreneur, May, 2003 by Christopher Elliott

IF YOUR FAVORITE AIRLINE IS FLYING UNDER Bankruptcy protection, you're probably worried about what might happen to your miles if the carrier goes under. Relax. Your points are probably safe.

Both United Airlines and US Airways, which have filed for Chapter ii bankruptcy protection, have assured travelers their miles are fine. As if to underscore the point, US Airways briefly offered triple miles for passengers on its shuttle flights, and United gave certain frequent fliers double miles on any route.

Even if one of the airlines goes belly-up, your miles will most likely be transferred to another airline's frequent-flier account. When TWA stopped flying, its frequent-flier memberships were transferred to American Airlines. But when Ansett Australia liquidated last year, its customers were out of luck. How do you safeguard your points?

* Insure them. AwardGuard (www.awardguard.com) protects any unused miles in your account and will return you to your point of origin if a mileage program collapses while you're on the road and no other program will honor your ticket. A one-year policy costs $119.

* Move them. Transfer your miles or elite status to a program with an airline that's on more solid financial footing. That's exactly what United and US Airways are trying to avoid with their generous mileage offers, but it will put an end to your concerns. Check out FrequentFlier.corn (www.frequentflier.com) for information.

* Use them. Burn miles while you can. Carriers are cutting back on awards. Delta, for instance, has announced that on discounted coach tickets, passengers would only earn half the miles they used to that can be counted toward elite status.

CHRISTOPHER ELLIOTT is a writer and commentator and the editor of www.elliott.org.

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