United Airlines has said it will offer passengers who volunteer to give up their seats on an overbooked flight up to $10,000 (£7,750).
It is one of several new policies it has unveiled in its efforts to avoid a repeat of the controversy and public relations disaster in which a passenger was dragged off one of its flights earlier this month.
Dr David Dao, 69, was filmed being forcibly removed from an overbooked US domestic flight on 9 April after refusing to give up his seat.
The new offer comes after rival Delta raised to $9,950 (£7,715) the amount it would pay for volunteers to get off overbooked flights.
United also promised fewer oversold flights and better staff training.
It said passengers who were already seated would no longer be required to give up their seats on overbooked flights.
The airline also said it would adopt a "no questions asked" policy on permanently lost baggage, paying customers $1,500 (£1,163) for the value of the bag and its contents, from June.
Mr Dao was a paying passenger who was already in his seat when he was removed from the Chicago to Louisville flight to make way for additional crew members.
The raft of changes announced by the airline on Thursday following a two-week review of the incident included a pledge to ensure crews in future are booked onto flights at least an hour before departure, unless there are available seats.
United again apologised for its initial response to the incident and confirmed it would no longer use police to remove passengers.
"This is a turning point for all of us at United and it signals a culture shift toward becoming a better, more customer-focused airline," said Chief Executive Oscar Munoz, who has faced calls to step down after referring to Dr Dao as "disruptive and belligerent" immediately after the incident.
"Our policies got in the way of our values and procedures interfered with doing what's right," Mr Munoz added.
Footage of a bloodied Dr Dao - who suffered concussion, lost two front teeth and broke his nose in the scuffle - quickly went viral and sparked a public outcry.
Videos of his treatment caused millions of dollars to be wiped off the value of United's parent company United Continental Holdings and social media users from around the world called for a boycott of the airline.
Dr Dao's lawyers appear to be preparing to launch legal action against the airline.
His lawyers have filed an emergency request with an Illinois court to make sure the airline preserves evidence such as videos, cockpit voice recordings, passenger and crew lists and other materials related to United Flight 3411.