Higher intermediate point (HIP)

Higher intermediate point (HIP) refers to a fare construction rule in which a one-way or half round-trip fare includes a segment between origin (or destination) and an intermediate city where that segment is actually more expensive than the fare for the overall origin-to-destination journey. 

For example, a passenger books a ticket from New York to Bangkok with a connecting flight through Tokyo. If the direct fare from Tokyo to Bangkok is higher than the overall fare from New York to Bangkok, Tokyo becomes a higher intermediate point. 

The airline applies the HIP rule, adjusting the ticket price to account for the higher cost between Tokyo and Bangkok, thereby ensuring the fare reflects the market value of the more expensive intermediate segment.This principle ensures that airlines maintain revenue integrity on routes where certain high-demand or premium city pairs could otherwise be underpriced if standard fare construction methods were applied.