Will travel insurance cover Iceland volcanic ash flight cancellations/delays?

Hundreds of flights have been cancelled across Europe as the Icelandic Grimsvotn volcanic ash cloud continues to spread its dusty wings across the continent.

The disruptions are not as bad as the ash cloud caused by the volcanic eruption at Eyjafjallajökull last year, but flights out of Scotland and northern England have been put on hold until the ash dissipates, and some airports in Germany have had to close as well.

Many travellers will be wondering whether their travel insurance will cover delays caused by the ash cloud.

The answer is yes... or, as is always the case with travel insurance, maybe.

Insurers won't cover travellers if they bought their policy after the volcano started erupting and this was reported around the world (around 23rd May).

For people already overseas, there is coverage with most policies, but travellers have to try to wrangle some compensation out of their airline first before the insurer will consider paying out.

We asked Travel Insurance Direct's General Manager, Ian Jackson, who replied:

Our underwriter, Mondial, yesterday issued advisories relating to the current situation in Europe as a result of the volcanic disruptions in Iceland. Cover for this incident is only available to those who purchased their policy before 5pm on Monday 23 May 2011.

For those who haven't left Australia yet, they can claim for cancellation of their trip as a direct result of the volcano and associated ash clouds where their transport has been cancelled, their accommodation declared uninhabitable, or if they are unable to reach their accommodation or destination.

For those already abroad, they can claim for reasonable additional travel and accommodation expenses if their journey is disrupted, or their transport has been cancelled, delayed, shortened or diverted.

Travellers using EU member airlines are also entitled to claim meals and accommodation from their airline under EU consumer protection laws; if they don't pay the full amount, the traveller should be able to claim the difference back from their insurer. If there are any concerns, travellers should contact their travel provider to discuss their options.

So, in summary, don't set off for your European trip at this point and expect insurance coverage against the ash cloud, as it is now a well known risk.

If you're over there already, you must ask your airline for compensation first -- your travel insurance is only likely to pay out what the airline has not already compensated you for.

If your airline refuses to compensate you, make sure you get that in writing so you have some proof to show the insurer.

Other Australian insurers have issued similar advice: Columbus Direct, Covermore, Suresave, Worldcare and QBE.

danwarne