Norwegian Cruise Line to pay on noncommissionable fares for advance bookings

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The Norwegian Breakaway. Norwegian Cruise Line said it would pay advisors on NCFs on cruises booked more than 120 days from sailing, as long as they submit a business plan to the line by the end of the year.
The Norwegian Breakaway. Norwegian Cruise Line said it would pay advisors on NCFs on cruises booked more than 120 days from sailing, as long as they submit a business plan to the line by the end of the year. Photo Credit: Norwegian Cruise Line

Norwegian Cruise Line plans to do away with noncommissionable fares for travel advisors who book sailings at least 120 days in advance.

Agents must also submit a marketing plan through the company's agent portal, Norwegian Central, by Dec. 31. After that, they will be eligible to make a commission on the full cruise fare for new reservations made Jan. 1 or later on voyages 120 days out -- i.e. departing May 1 or later.

Noncommissionable fares, or NCFs, are the portion of a cruise fare on which an advisor doesn't make a commission. Historically, the NCF would include port fees and other fixed, pass-through charges, although lines have declined to itemize the amounts, and the practice has at some points become a sore spot with the trade.

The change at NCL works as a strategy to incentivize booking further out, said Todd Hamilton, the line's senior vice president of sales.

Not only do further-out bookings help the line fill its ships sooner, but customers who book further out  are more likely to book again with the brand, rebook with that travel advisor and offer higher satisfaction scores after their sailing, he said.

As for requiring advisors to submit a marketing plan in order to receive commissions on NCFs, he said: "We are a marketing company that sells cruises. Every decision we make should have a marketing component to it. So we want our team to be talking to the travel partners about their marketing, how we can best market ourselves."

Hamilton said he has questioned the use of NCFs since he became vice president of sales in mid-2021.

"I think the way we support people is to be open and honest and transparent with them, and instead of having these noncommissionable fares, we're going to come out and pay people outside of 120 days on the entire cruise fare," he said.

NCFs have "always been the third rail of what you can't touch inside the cruise industry, and as an advocate of the travel agent community and the travel partner community, I look at that as something we can do to be a supportive partner," Hamilton said.

The new policy only applies to NCL, not to sister cruise lines Oceania Cruises and Regent Seven Seas Cruises.

Although NCFs have a long history among cruise companies, some lines have courted the trade by paying commission on NCFs. And some newer cruise lines never introduced them; for example, Viking, Virgin Voyages and Explora Journeys have refrained from using NCFs.

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