Munoz confessed to the airline's failures in his opening statement.
Lawmakers harshly criticized United Airlines Inc UAL.N on Tuesday, demanding answers from the carrier's apologetic chief executive after a passenger was dragged off an overbooked flight last month.
United CEO Oscar Munoz's appearance before the U.S. House Transportation and Infrastructure Committee was a test of how the Republican-led Congress would address company misconduct.
The hearing opened with the committee's top Republican and Democrat both decrying the state air travel for customers.
The resulting viral video of Dr. David Dao's removal prompted United to issue a slew of policy changes and several apologies.
United's CEO, Oscar Munoz, who attended the hearing with President Scott Kirby, said that event was marked a "serious breach of public trust" and apologized for an "inadequate" response. United and lawyers for Dao have declined to disclose financial terms of the settlement.
Munoz again apologized personally to David Dao, the passenger who boarded a United plane in Chicago and then refused to give up his seat when the airline needed it to accommodate crew members. "For our part, Alaska is carefully reviewing sensitive customer policies such as rebooking and it is our intent to improve the experience for our guests", said Joseph Sprague, Alaska Airlines.
Lawmakers have already proposed legislation to potentially bar airlines from overbooking flights or to prevent carriers from removing a passenger who is seated aboard a plane, according to USA Today.More news: Jose Mourinho ponders fielding under-23 side against Crystal Palace
While it was United's policy to use police to remove bumped passengers who wouldn't leave their seats, Munoz said under questioning that he wasn't aware of any similar cases.
Video of the incident has sparked more than two weeks of withering criticism and mockery of United.
Munoz said United would now offer up to $10,000 in flight vouchers to give up an overbooked seat. Chairman Bill Shuster (R-Pa.) said "something is broken" and the airlines all agreed they can do better.
Many lawmakers fly weekly to and from Washington and during the hearing took the opportunity to recount the frustrations customers routinely face, including complicated booking systems, confusing fees, long waits and unexplained flight delays.
Much of the hearing focused on the practice of overbooking - which airlines rely on to make sure every seat is filled on every flight.
Author William McGee, who represented the Consumers Union at Tuesday's hearing, noted a report in The Economist that found profits per passenger in North America were more than $22, almost three times higher than in Europe.
"We know we have some catching up to do", testified Kerry Philipovitch, senior vice president of customer experience at American Airlines.
The airline boss also said: "We had a terrible failure three weeks ago". Or Congress could require that airlines more clearly spell out the rights of passengers, said Thomas Cooke, a distinguished teaching professor at Georgetown University's McDonough School of Business.
The White House has not weighed in on whether new rules are needed to respond to airline customer service issues, and it was unclear how quickly Congress might move, if at all.