Passengers could soon be able to claim up to $20,000 for lost, delayed, or damaged luggage under a new draft civil aviation bill.
If it passes, Kiwis will be able to apply to the Disputes Tribunal to recoup costs.
Transport Minister Phil Twyford said the shake-up will "modernise" key pieces of aviation legislation, including rules on drone use.
The minister is meeting with airport and airline management to discuss the changes.
The public has until July 6th this year to make submissions.