Travel Insurance: Can you claim if disrupted by Volcanic Ash?
By Kate Saines
As if BA strikes, budget airlines imposing excess costs and enhanced security weren't enough to cause a headache to even the most laid back and seasoned of travellers, along came the Volcanic Dust Episode.
For those of you who have been hidden away from the world for the last few days, the eruption of a volcano in Iceland has caused - to coin a much-used phrase- air travel chaos.
Flights have been cancelled, air crew grounded and passengers with flights booked left in limbo as British airspace has been officially closed.
Flights restrictions are not due to be lifted until Tuesday, April 20th, but problems are set to continue after that date as airlines get back on their feet. And many people whose travel plans have already been disrupted by the events are likely to be in the midst of their own chaos.
To make matters more confusing there seems to be a discrepancy between insurers as to whether or not the costs of flights delayed by such a bizarre and seemingly random event can be claimed back by travellers.
While airlines and tour operators are to refund or rebook flights affected, there is still the issue of accommodation and other travel arrangements at destinations to be considered.
The cost of a hotel room, car hire, transfers and other pre-booked travel plans will not be covered by airlines.
So, this is where people usually look to their travel insurer to help them out.
But the message from the insurance industry seems to be that depending on the insurer with which you have your travel insurance policy, you may or may not be able to claim for the disruption.
The British Insurance Brokers' Association (BIBA), for example, said its own travel insurance policies would cover for this event, adding that it was 'confident' all volcanic ash claims under the BIBA member policies would be met.
But Steve Foulsham, BIBA's technical services manager, points out that this might not be the case with all insurers.
"Not all insurance policies are the same," he says, "and travellers are urged to contact their insurance provider to clarify their specific policy coverage as not all insurers will necessarily cover this."
He does clarify, however, that travel insurance policies are normally transferrable to any new travel plans that people make and travellers should speak to their insurer about this.
This point has been reinforced by the Association of British Insurers (ABI) which says if you accept an alternative flight at a later date, most insurers will amend your policy to cover your new travel arrangements and dates.
It also says if your flight is cancelled and you do not travel, most travel insurers will refund your premium if you take out a single trip policy.
However, it points out that anyone taking out a policy after the Volcanic Ash incident had been reported on Thursday, April 15th, will not be covered.
"Insurance only covers events that happen after the policy is taken out," the ABI says in a statement.
Insurer Fortis has been among the first to reveal it will be providing cover for the incident.
It is treating the Volcanic Ash episode as a 'bad weather event' which will allow its customers to claim under that specific term of their travel insurance policy.
It says it will provide a delay compensation benefit, which helps with costs of overnight stays and food if a flight is delayed, as well as abandonment cover in case a passenger who has waited more than 12 hours for a delayed flight decides to cancel their trip.
There is also a missed departure benefit in the event a customer misses an international flight because of delays to connecting domestic flights.
Direct Line also says its customers will be covered for travel delay and missed departure.
Like all insurers it insists customers contact their airline or tour operator first.
Jennifer Thomas, a spokesperson for the Direct Line says: "If an airline cancels a flight, then customers should claim for a new flight from their airline.
"If they have booked the flight on their credit card, the Consumer Credit Act (CCA) could help with any claims made."
Direct Line says that if a customer has a cancelled flight and is refunded from the airline, but has accommodation booked they could not cancel or use, these claims would be considered under its 'travel delay leading to trip abandonment' term.
Ms Thomas adds: "Customers need to provide written official evidence to support any claims where it is reasonable to request such evidence.
"In this case, information from official airline websites is acceptable as evidence."
NatWest says its travel insurance customers, including those who have a policy via one of its packaged accounts, will be covered for travel delay and missed departure.
HSBC, First Direct and M&S Travel have also come forward and said that although claims connected with volcanic eruptions are not normally covered in this instance they are making an exception.
But despite the positive reaction by some insurers, and their issuing of useful advice, there have been others who have not been so helpful.
Moneysupermarket.com's travel expert, Bob Atkinson, says the reaction from many travel insurers has been "extremely disappointing".
On the day after the ash cloud was reported, he said: "Over 24 hours into this incident, the majority still haven't developed a position on how they will handle any claims for cancelled and delayed flights and any other monetary loss as a result.
"I would have hoped insurers would have contingencies in place for such events, no matter how unexpected."
He added: "This is exactly the type of event that customers buy insurance for and they should be able to claim for the cost of their lost holiday and costs that they occur.
"Insurers must not use their small print to wiggle out of this one."
Mr Atkinson issued the following advice to air travellers:
1. Before setting off, contact your airline, tour operator or travel provider to find out about cancellations, refund and changes. "If you are travelling as part of an ATOL-covered package, your tour operator will be able to advise you on total travel plans," he said. "If you have independent arrangements then you need to speak to your airline as well as hotel companies and any others you have bookings with to check your options."
2. Complete cancellation of flights should be covered by a refund from the airline. Other costs, hotels, car hire etc, can vary and he urged customers to check those as soon as possible and cancel arrangements to minimise losses.
3. The next step is to contact your insurer to find out whether you are covered for the incident. As mentioned, different insurance companies have different policies on this.
4. Policies which do cover the event are likely to follow typical rules for delayed departure. This means you would be able to claim after 12 hours of delay. But, to enhance your chances of a successful claim, it is important to make sure you obtain written confirmation from the airline which cancelled the flight.
5. Travellers should read their insurance policies carefully to make sure they know what they are and are not covered for, and to find out the procedure for claiming, as this differs from insurer to insurer.
Whether or not you have been affected, the Volcanic Ash debacle has certainly brought the issue of buying travel insurance very much into the forefront.
And the event is likely to make the travel insurance industry look at its policies and how flexible they are.
Mr Atkinson addsed "The industry really needs to get its act together and at least provide reassurance to travellers as to whether claims will be considered or not."
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