Strikes, ash clouds and countries in crisis – you had better double-check your insurance

Many travellers, horrified at spending their annual holiday dodging bullets, will be wondering whether to abandon their plans for an overseas trip altogether.

But for those already booked, the most pressing issue is will their travel insurance cover them if they are forced to abandon their holiday at the last moment, or indeed if they are caught out by strikes, demonstrations or rioting while abroad.

Kate Niven, senior travel underwriting manager at Aviva, said: "I have a huge amount of sympathy for travellers. This level of uncertainty is unprecedented. I have never known a time when so many things were converging all at the same time."

Lonely Planet travel editor Tom Hall was more reassuring, reminding travellers they should not be alarmed unnecessarily, as most tourist destinations remain relatively safe.

He said: "There are undoubtedly a number of potential flash points around the world, but not many of these are on the beaten track for travellers. Obviously Afghanistan and Somalia are not recommended. Kenya had problems last year, and elections this year, so it is unclear what impact these may or may not have.

"When we look into the future, though, our biggest concern is a major terrorism attack somewhere in the world, which we have no way of predicting."

In such a climate, Hall recommends travellers check Foreign Office advice carefully before they book their holiday, and check it again before they travel.

If the advice has changed, and you are booked on a package, your tour operator will normally be helpful in allowing you to rebook an alternative destination or dates. However, individual travellers who have booked flights and accommodation over the internet are less well protected. They may have only a travel insurance contract to fall back on.

If this is the case, then the scope to claim compensation will come down to the small print on your individual policy. You must read it carefully, and buy wisely.

For example, terrorism used to be excluded, but now six out of ten contracts cover the fallout from an attack. Insure with one of the others and you could be left high and dry.

If the Foreign Office advises against travel, some insurance companies will pay for cancellation costs. If you decide to travel against this advice then your contract is nullified.

However, other companies, including Aviva, look at life completely differently. They will not pay for cancellation, even if the Foreign Office has issued a warning. Nevertheless, if you continue with your travel plans then your insurance remains in place and will pay out on all normal risks.

Independent travellers must take even greater care when buying their insurance, to check it will cover most eventualities. Quiz the company carefully about its attitude to your destination. It is vital that you can claim medical and repatriation costs whatever the political situation. Below we outline the risks in greater detail.

Thailand

Unfortunately, you may not be able to claim for a refund for the cancellation of your holiday simply because the Foreign Office says you should not travel. Niven explains: "At Aviva, we spell out clearly when cancellation refunds are appropriate, and these normally relate to illness or a catastrophic event such as a fire at your home.

"If the Foreign Office advises against travel, and you want to cancel, then that is your choice and you must bear the financial consequences.

"If you do go, however, we will cover you, provided you always obey local instructions such as curfews or advice on areas to avoid."

The Association of British Insurers' Malcolm Tarling added: "If you are in a troubled area, then you must not join in any demonstrations on any account. There is no insurance policy available for travellers who enjoy the thrill of high-risk political activity or unrest."

Greece

You will not be able to claim compensation if you decide you no longer wish to travel to Greece following the recent unrest, simply because you have gone off the idea.

But it is important to make sure your travel insurance covers you in the event of civil unrest, in case your baggage is delayed or you are hit by strikes.

Airline strikes

Your first port of call for compensation for travel disrupted by strikes should be the airline in question, which is responsible for providing refunds or offering alternative travel arrangements. If it is simply a question of delay, then your travel insurance policy may pay limited compensation for however long (up to, say, 48 hours) that your travel plans are disrupted. After that you may be allowed to abandon your travel plans and receive compensation.

However, this will only apply if you took out your contract before there was any risk of a strike. Should the BA disruptions go ahead, you will only be protected if you bought the policy before 10 May, when the strike dates were announced.

For complete peace of mind, try an annual policy. This can provide value for money if you travel abroad more than once a year, but also gives year-round protection against disruption.

Ash cloud

Virtually no insurance contracts will cover you for events such as volcano eruptions or weather disruption. However, in the event of holidays ruined by the ash cloud, some insurers have agreed to make ex gratia payments to those caught up in the early chaos.

However, insurers will not be so generous to any holidaymakers booking travel now, on the grounds that the risk of delays due to the ash cloud are now well publicised. If you want to take the risk, then you must face the financial consequences if your flights are grounded.

Package holiday travellers should find it relatively easy to make alternative arrangements. Independent travellers should again first claim against their airline, although it must be remembered that a cancelled flight may result in lost accommodation, car hire and other expenses.