Volcanic rumbling
As air travel around the world continues to be disrupted by the intermittent bursts of ash from the Eyjafjallajokull volcano in Iceland, travel insurers are being slated in the international press for a lack of consistency over cover. In Ireland, travellers who took the advice of the Dublin Airport Authority and stayed away from the airport during May’s closures may well have invalidated their right to claim on their travel insurance, according to one industry spokesperson. Ciaran Mulligan, managing director of travel insurance specialist Blue Insurances, said that policies would typically compensate ‘anyone who checks in for a flight that is subsequently delayed or cancel led’. She went on to say that passengers who checked in online at home, but then did not journey to the airport could be covered, but only at their insurers’ discretion. Some travel insurers, including Blue Insurance, have been paying claims as a gesture of goodwill, while others have directed their customers to seek compensation from the airline they were supposed to fly with. A spokeswoman for the Dublin Airport Authority said she was unaware that telling passengers not to travel to the airport could have had an adverse affect on travel insurance coverage. In the UK, Columbus Direct and Insure2Travel have both launched add-on products that customers can pay for in addition to their normal travel insurance, which specifically cover travel delay/cancellation of a holiday as a result of the volcanic ash cloud returning. The upgrade from Columbus Direct, worth £4,000 per policy, is intended to cover customers for the cost of alternative accommodation, or enable them to travel by alternative means to get home. Graham Linney, director of Columbus, said: “Not all travel insurance is the same, and we are very proud to be the first provider to offer such comprehensive cover that will help compensate people through very difficult circumstances such as the ash cloud, and who know what else in the future.” Low-cost airline Flybe claimed to be the first airline to offer cover for volcanic ash, with the policy being underwritten by Chartis. The cover kicks in when the UK’s Civil Aviation Authority or any relevant overseas equivalent closes airspace. Over-50s insurer Saga is dealing with each volcanic eruption as a separate incident, meaning if a customer takes out travel insurance when there are no flight restrictions in place, and then the next day the volcano erupts again, the customer will be covered. Nick Starling, director of general insurance and health at the Association of British Insurers, tried his best to explain to the public why travel insurance doesn’t, as standard, include cover for volcanic ash: “Most policies are designed to stand alongside, not duplicate, the compensation that people are entitled to from their airline or tour operator. Any cover provided by travel insurance in these circumstances will vary as there is no such thing as a standard travel insurance policy. Customers should therefore check their travel policy and speak to their travel insurer if they are still unsure.” He went on to say that so far, “Travel insurers expect to pay around £62 million following disruption caused by the recent closure of airspace. This represents 16 per cent of the annual amount paid out by UK travel insurers.” Graeme Trudgill, technical and corporate affairs manager for the British Insurance Brokers Association, also weighed into the debate: “Insurance is for the unexpected, and the Icelandic disruption is now a known event, so insurance policies bought since the first eruption on 14 April will not cover the cost of travel disruption.” Meanwhile, AA Travel Insurance is reported to have reneged on a promise to pay out on travel claims resulting from the volcanic ash cloud. The company originally said it would pay out as a gesture of goodwill, but the underwriters have since re-considered their position since airlines agreed to take the lion’s share of the compensation costs. Other insurers who have shied away from offering cover for volcanic ash-related cancellations or delays include Virgin Money, Holiday Extras, Europ Assist, Swinton and Endsleigh. Those insurers who are offering some form of cover include AllClear, Swiftcover, Tesco and Post Office Travel Insurance. Most US insurers who sold trip cancellation policies were issued before the volcano erupted have paid claims connected to the event under natural disaster or weather events coverage, if the policy was purchased before the April eruption, according to Jim Grace, president of the US Travel Insurance Association. He said: “The ash is carried by the wind and hence is a weather event.” In Australia, local insurer 1Cover has said that it will honour claims brought by customers on policies bought before 16 April. Airlines have not escaped criticism for the way in which they handled the crisis, with a survey of carrier websites by the Air Transport Users Council found that many airlines put information that could help passengers claim money back for flight disruption in unlikely places, making it more difficult to customers to locate the necessary information. A spokesman said: “We found that with many airlines’ websites, instructions on how passengers can go about claiming their expenses, and also on how to get a refund of a ticket if they did not travel, are either tucked away in a section of the site that can be difficult to find or are not there at all.” The organisation has called on carriers to provide links from the home pages of their websites to information on how money can be claimed back.
As air travel around the world continues to be disrupted by the intermittent bursts of ash from the Eyjafjallajokull volcano in Iceland, travel insurers are being slated in the international press for a lack of consistency over cover.
In Ireland, travellers who took the advice of the Dublin Airport Authority and stayed away from the airport during May’s closures may well have invalidated their right to claim on their travel insurance, according to one industry spokesperson. Ciaran Mulligan, managing director of travel insurance specialist Blue Insurances, said that policies would typically compensate ‘anyone who checks in for a flight that is subsequently delayed or cancel led’. She went on to say that passengers who checked in online at home, but then did not journey to the airport could be covered, but only at their insurers’ discretion. Some travel insurers, including Blue Insurance, have been paying claims as a gesture of goodwill, while others have directed their customers to seek compensation from the airline they were supposed to fly with. A spokeswoman for the Dublin Airport Authority said she was unaware that telling passengers not to travel to the airport could have had an adverse affect on travel insurance coverage.
In the UK, Columbus Direct and Insure2Travel have both launched add-on products that customers can pay for in addition to their normal travel insurance, which specifically cover travel delay/cancellation of a holiday as a result of the volcanic ash cloud returning. The upgrade from Columbus Direct, worth £4,000 per policy, is intended to cover customers for the cost of alternative accommodation, or enable them to travel by alternative means to get home. Graham Linney, director of Columbus, said: “Not all travel insurance is the same, and we are very proud to be the first provider to offer such comprehensive cover that will help compensate people through very difficult circumstances such as the ash cloud, and who know what else in the future.” Low-cost airline Flybe claimed to be the first airline to offer cover for volcanic ash, with the policy being underwritten by Chartis. The cover kicks in when the UK’s Civil Aviation Authority or any relevant overseas equivalent closes airspace.
Over-50s insurer Saga is dealing with each volcanic eruption as a separate incident, meaning if a customer takes out travel insurance when there are no flight restrictions in place, and then the next day the volcano erupts again, the customer will be covered.
Nick Starling, director of general insurance and health at the Association of British Insurers, tried his best to explain to the public why travel insurance doesn’t, as standard, include cover for volcanic ash: “Most policies are designed to stand alongside, not duplicate, the compensation that people are entitled to from their airline or tour operator. Any cover provided by travel insurance in these circumstances will vary as there is no such thing as a standard travel insurance policy. Customers should therefore check their travel policy and speak to their travel insurer if they are still unsure.” He went on to say that so far, “Travel insurers expect to pay around £62 million following disruption caused by the recent closure of airspace. This represents 16 per cent of the annual amount paid out by UK travel insurers.”
Graeme Trudgill, technical and corporate affairs manager for the British Insurance Brokers Association, also weighed into the debate: “Insurance is for the unexpected, and the Icelandic disruption is now a known event, so insurance policies bought since the first eruption on 14 April will not cover the cost of travel disruption.”
Meanwhile, AA Travel Insurance is reported to have reneged on a promise to pay out on travel claims resulting from the volcanic ash cloud. The company originally said it would pay out as a gesture of goodwill, but the underwriters have since re-considered their position since airlines agreed to take the lion’s share of the compensation costs. Other insurers who have shied away from offering cover for volcanic ash-related cancellations or delays include Virgin Money, Holiday Extras, Europ Assist, Swinton and Endsleigh. Those insurers who are offering some form of cover include AllClear, Swiftcover, Tesco and Post Office Travel Insurance.
Most US insurers who sold trip cancellation policies were issued before the volcano erupted have paid claims connected to the event under natural disaster or weather events coverage, if the policy was purchased before the April eruption, according to Jim Grace, president of the US Travel Insurance Association. He said: “The ash is carried by the wind and hence is a weather event.” In Australia, local insurer 1Cover has said that it will honour claims brought by customers on policies bought before 16 April.
Airlines have not escaped criticism for the way in which they handled the crisis, with a survey of carrier websites by the Air Transport Users Council found that many airlines put information that could help passengers claim money back for flight disruption in unlikely places, making it more difficult to customers to locate the necessary information. A spokesman said: “We found that with many airlines’ websites, instructions on how passengers can go about claiming their expenses, and also on how to get a refund of a ticket if they did not travel, are either tucked away in a section of the site that can be difficult to find or are not there at all.” The organisation has called on carriers to provide links from the home pages of their websites to information on how money can be claimed back.