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Travellers can take out insurance against risks caused by activated volcanoes

News received from Iceland today regarding activity of the Grimsvotn volcano, are pleasant for travellers, because the eruption has subsided. But geologists say that there is no reason to declare that volcanic activity has completely ceased. This means that resumption of the volcanic activity is not excluded, which might result in formation of new smoke and dust clouds, which, in turn, might cause cancellation of flights, as it was in the European airspace yesterday and today.

In April and May of 2010, eruptions of the Iceland’s Eyjafjallajokull volcano caused difficulties for air traffic in almost a month. In connection with the closure of airspace, flight cancellations and travel delays due to the volcanic eruption the Joint Stock Insurance Company “Seesam Latvia” paid out 34 insurance indemnities to its customers.

An unplanned costs position contained in a large proportion of the claims received was the costs of alternative transport, which was necessary to allow travellers to return home.

Neither the law "On insurance contract", nor travel insurance conditions of insurance companies envisage liability for loss or damage caused by natural disasters, including volcanic eruptions, but the JSIC Seesam Latvia adopted decision on April 15, 2010 on compensation of losses incurred by its customers, who had purchased travel insurance programs that included flight delay or short-term cancellation risks.

– In total, we paid out more than 6100 euros (more than 4300 lats) in insurance indemnities. The average indemnity amounted to little more than 180 euros (about 127 lats). The largest indemnity was 600 euros (more than 420 lats), which was paid for costs of three persons who returned home from Switzerland by a rental car. Our customers used rental cars to return home from Barcelona, and Warsaw and Brussels. In several cases, people returned back to Latvia by train, for example, from Frankfurt in Germany or Croatia. We covered costs to a part of customers that had incurred because of purchase of new airline tickets or, for example, ferry, taxi or other alternative transportation costs, as well as compensated reasonable expenses confirmed by cash register receipts for purchase of gasoline required for returning home, – explains Mr. Aigars Umbraško, Expert of the Claims Department of the JSIC “Seesam Latvia”.

- In view of this experience and not excluding probability of re-occurrence of this risk, on May 15, 2010 the JSIC Seesam Latvia extended its travel insurance offer by creating a package Golden Extra, which includes also compensation of alternative transportation costs in the case of airflight cancellation if this has been caused by activation of a volcano. Now customers themselves may choose whether or not to purchase an insurance program that includes this risk.

Additional information:

Vienības gatve 87H, Riga, LV-1004, Latvia

Tel. No. +371 67 06 10 29

Fax No. +371 67 06 10 22

dace.gertnere(a)seesam.lv

http://www.seesam.lv