Two completely different legal ceilings apply depending on one thing: whether your flight segment is domestic or international. Get the jurisdiction wrong, and you'll submit the wrong claim amount entirely.
The Myth
"If an airline loses my luggage on an international journey, U.S. law entitles me to the same compensation cap as a domestic flight."
It's an easy mistake to make, since both figures get quoted constantly in baggage-claim advice — but they come from two entirely different legal systems, and mixing them up leads to submitting the wrong claim amount.
The Reality
Baggage liability caps are dictated strictly by the jurisdiction governing your specific itinerary. Domestic U.S. flights operate under federal rules enforced by the Department of Transportation. International flights — including those departing from or arriving in the United States — are instead governed by an international treaty, the Montreal Convention of 1999 (MC99). These are not interchangeable, and the cap that applies depends on which one governs your ticket.
The Hard Data: Domestic Mandates vs. International Treaty
Domestic U.S. Flights (DOT Federal Mandate)
For flights entirely within the United States, 14 CFR Part 254 sets the minimum liability cap airlines must maintain:
- Federal liability cap: $4,700 per passenger — this figure was raised from the previous $3,800 cap, effective January 22, 2025, following the DOT's routine two-year inflation review. If you see $3,800 cited anywhere, that's the outdated pre-2025 figure.
- Baggage fee refunds: if your checked bag is lost, the DOT requires the airline to separately refund the checked-baggage fee you originally paid to transport it.
- Exclusion restrictions: airlines can't arbitrarily limit liability for fragile or valuable items beyond what's explicitly disclosed in their published Conditions of Carriage.
International Flights (Montreal Convention)
International air transport between Montreal Convention signatory states is governed by Article 22:
- International liability cap: 1,519 Special Drawing Rights (SDR) per passenger — an IMF-defined reserve unit based on a basket of major currencies, not a fixed dollar figure.
- Currency conversion: the SDR-to-dollar (or SDR-to-euro) conversion is generally calculated using the official IMF valuation rate applicable on the date your claim or settlement is finalized — not the date your flight took place, which matters if exchange rates shift meaningfully between the two dates.
Real Cases: Jurisdictional Conflicts on Connecting Flights
Case 1: A Domestic Leg Inside an International Itinerary
The scenario: You fly Austin (AUS) to Atlanta (ATL) on a domestic leg, connecting onward to London (LHR) — all on one ticket. Your checked bag goes missing on the Austin–Atlanta segment specifically.
Applicable law: Because the domestic segment forms part of a single, unbroken international itinerary, the Montreal Convention's 1,519 SDR cap applies to the entire journey — not the higher domestic DOT $4,700 figure, even though the actual mishandling happened on U.S. domestic soil.
Case 2: Separately Ticketed Domestic and International Legs
The scenario: You buy a standalone ticket from Chicago to Miami, and a completely separate ticket with a different airline from Miami to Jamaica. The first airline loses your bag on the Chicago–Miami leg.
Applicable law: Because these are separate contracts of carriage under separate booking references, the domestic segment is governed entirely by DOT rules — meaning the $4,700 cap applies here, since this leg is legally its own self-contained domestic itinerary.
The Protocol: Valuing Your Claim Correctly
- Obtain proof of valuation. Purchase receipts, credit card statements, or order confirmation emails for the contents of the bag.
- Account for depreciated value, not retail price. Airlines calculate compensation based on the fair market value of items at the time of loss, not what you originally paid — applying a standard annual depreciation rate.
- Submit an itemized inventory. List each item with brand name, approximate age, and replacement cost, alongside your Property Irregularity Report (PIR).
Before you submit anything, confirm which framework actually governs your itinerary using the two connecting-flight scenarios above — it changes both your maximum possible claim and how you should phrase the legal basis for it. Our Lost Luggage Inventory Template gives you a structured place to build that itemized list, and our letter generator can draft the formal claim citing the correct jurisdiction and cap.
Related Kibbo Tools
- Lost Luggage Inventory Template →
- Baggage Claim Checklist →
- Generate a Flight Disruption Compensation Letter →
Sources
- U.S. Department of Transportation — Lost, Delayed, or Damaged Baggage, official rules. airconsumer.dot.gov
- Federal Register — Periodic Revisions to Denied Boarding Compensation and Domestic Baggage Liability Limits, 89 FR 84815, effective January 22, 2025 (confirms the $4,700 domestic cap). federalregister.gov
- International Monetary Fund — Special Drawing Rights valuation, official daily rates.