Unholy smoke: Travel insurance may not cover 'acts of God'
Following the flight chaos caused by the massive ash cloud from the Icelandic volcano, many consumers found their travel insurance policies didn't cover 'acts of God', writes John Cradden
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Thursday May 06 2010
YOU would be forgiven for being confused about whether you can claim on your travel insurance because of the travel chaos caused by the recent Icelandic volcanic ash, or if a policy would cover you if an event like it happened again.
Brokers here say that insurers are refusing, in most cases, to cover claims resulting from the volcanic ash disruption because they are interpreting the event as an 'act of God'.
"Insurers are currently referring to this situation as an act of God, and not adverse weather," said Ciaran Phelan of the Irish Brokers' Association.
"Therefore, there is a strong likelihood that many consumers will not be covered."
Brokers add that many policies will also not cover the grounding of aircraft by civil aviation authorities.
This means that losses for booked accommodation, car rental and so on will not be covered.
However, Mr Phelan says some insurers have, as a gesture of goodwill, decided to regard the event as adverse weather and "pay reasonable claims where every effort has been made by the insured to minimise the loss and where their outlay cannot be recovered from any other source such as airlines and hotels".
What the recent air travel disruption has highlighted about travel insurance is the need to check over your policy terms and conditions, or contact your insurer or broker if there are things you are not clear about -- ideally before the trip begins.
This is because the terms and conditions can vary a great deal from provider to provider.
The Professional Insurance Brokers' Association (PIBA), which also represents insurance brokers, said it was sympathetic about the confusion being experienced by customers over what their travel insurance covers as a result of events like the recent air travel chaos.
"We would call for clarity within the industry in relation to certain vague definitions or exclusions such as 'act of God'," a PIBA spokeswoman said.
"It's vital to ensure peace of mind and so that people know exactly what they are covered for in a transparent manner."
However, Jane O'Driscoll of the Irish Insurance Federation, which represents insurance companies, dismisses claims about 'act of God' exclusions.
"The act of God argument is a red herring," she said. "The disruption was caused by a volcanic eruption."
The causes of travel delay or holiday abandonment covered by a travel insurance policy are generally specified in the policy wording, she said, which typically include poor weather conditions, a strike, industrial action or a mechanical breakdown.
"If the cause is not specified there is generally no cover, and a volcanic eruption is not generally specified. That said, policy wordings vary and it is worth checking your policy or contacting your travel insurance company for clarification," she said.
Take care when choosing a new policy
Price will always be a factor in choosing a travel insurance policy, but you should pay just as much attention to the benefits, exclusions and excesses.
Review what each policy covers in terms of cancellation or curtailment, travel disruption (which should include cost of alternative transport and accommodation), and travel delay (meals, drinks and other out-of-pocket expenses).
You should take your own personal circumstances and travel plans into account.
"For example, for a skiing holiday you must be absolutely sure that your policy covers winter sports and that you have chosen the correct premium option," says Mr Phelan.
If there are particular risks you are worried about you should carefully note what exactly the policy says about such risks.
For instance, some travel insurance policies have "catastrophe cover", which covers you if you are forced to move from your holiday accommodation because of a fire, lightning, an explosion, flood, storm, earthquake, or medical epidemic.
Volcanic eruptions are not listed -- but it's clear that because the Icelandic volcanic-related disruption was to flights rather than accommodation, this cover would not have been applicable.
Advice on claiming
Once you have chosen your policy, it pays to study the information about what to do if you ever need to make a claim.
According to the National Consumer Agency, some polices will have very specific instructions about what you need to do while still abroad in order to make sure your claim will be accepted.
For instance, you may need to obtain a police report within a certain timeframe, while other policies will want to know that you contacted the company's emergency assistance line as soon as possible after the event.
Make sure you keep all documents and receipts that support your claim.
You should send in your claim as soon as you can, as there may be a time limit for making claims.
Irish Independent
