In my experience, the airline can put you on another flight, but they’re not required to. They’re also not required to put you up in a hotel if the cancellation situation is due to the weather. It comes down to the weather being an “act of god” situation, so in fairness they can’t really be asked to go to a great amount of trouble or expense.
I would suggest anyone to take out “Multi trip travel USA general insurance” as most annual multi-trip travel USA general insurance policies would have ‘Travel Delay’ cover included. This will usually pay you a compensatory benefit based on delays in excess of 12 hours. These sums are normally per person but low for the first 12 hours and an additional amount for each subsequent 12 hours delayed.
This section will include ‘Travel Delay Abandonment’ which means after a certain period i.e. 12 hours; you can cancel the entire trip and claim for the original trip costs. It is unlikely that any such policy would cover you for additional accommodation or travel costs as this has always been the responsibility of the airline.
What are your legal rights as passenger if or when your flight is either delayed or canceled? I found the following information online. Quote- “In practice, many airlines will provide refreshments or accommodation for passengers whose flights have been canceled or are subject to a long delay. Or they may transfer passengers to other flights. But very few will voluntarily pay compensation in addition (unless under EU Regulation 261/2004.)
Nonetheless, under provisions in the Montreal Convention, an airline is liable for “damage occasioned by delay”, up to a limit of 4,150 Special Drawing Rights (SDR). However, an airline may not be liable if “it proves that it and its servants and agents took all measures that could reasonably be required to avoid the damage or that it was impossible for them to take such measures”. In practice, any payment that an airline is prepared to make for a delay will at best be reimbursement of expenses that it accepts were directly and necessarily incurred as a result of the delay (such as meals or overnight hotel accommodation). Airlines generally do not accept any liability for inconvenience, stress or any consequential losses arising from the delay, unless they are required to do so as a result of court action.
When a flight is canceled, an airline is contractually obliged to provide alternative transportation (not necessarily by air) or a refund.