Bali Ash Cloud Claim Advice
The Volcanic Ash Advisory Centre has taken Mount Rinjani off its active volcano watch. There has been no eruptive activity noted in the past few days. As the volcano has ceased eruptive activity, this advice does not apply to policies purchased on or after 9 December 2015.
Flights between Australia and Bali are currently being disrupted due to a new Bali ash cloud.
Go Insurance has recently learned that Mount Rinjani, an active volcano located on Lombok Island, began erupting on 3 November 2015. This new Bali ash cloud is causing disruption to scheduled flights in and out of Bali airports.
Jetstar and Virgin have determined that flying conditions are unsafe due to the ash cloud. Whilst Jetstar have hopeful that some services scheduled for 3 November 2015 will still operate, Virgin have cancelled all flights scheduled to and from Bali on 3 November 2015. Both airlines have indicated that they are awaiting advice from the Volcanic Ash Advisory Centre before making a decision on whether flights scheduled for later in the week will still operate.
Jetstar and Virgin are both providing updates to affected passengers via their website.
“In principle” advice regarding likely policy response to claims for cancellation, disruption and delay of scheduled travel arrangements is provided below.
Please note that this Bali ash cloud is unrelated to the eruption of Mount Raung which disrupted flights to and from Bali in July 2015.
For Single Trip policies purchased prior to 12 noon AEST on 3 November 2015 and trips booked under Annual Multi Trip policies prior to 12 noon AEST on 3 November 2015:
- Disruption experienced post-departure
Claims for disruption to scheduled travel arrangements post-departure are considered under Section 1 or Section 10.
To claim under Section 1, your policy must include the Cancellation and Curtailment module. To claim under Section 10, your policy must include the Disruption module.
Subject to relevant terms and conditions, Section 1 will compensate the Insured Person for additional travel expenses incurred (and a proportionate refund of unused arrangements) if a natural disaster prevents the planned travel from occurring.
Subject to relevant terms and conditions, Section 10 provides financial assistance in the event the departure of public transport on which the Insured Person is booked to travel is delayed by at least 12 hours. Section 10 does not operate if the Insured Person has claimed under Section 1 or 12 (Special Events) in relation to the same cause.
All Insured Persons must act as a “prudent uninsured” and proceed on the most economical basis to minimise their loss. We therefore suggest in the first instance they liaise with airlines and associated travel providers to reschedule travel arrangements / obtain refunds as appropriate. Some airlines will provide accommodation to passengers whose travel is disrupted due to natural disasters and policyholders should avail themselves of this facility if possible.
All claims for additional accommodation and travel expenses must be supported by receipts, evidence of pre-booked travel schedule and actual travel arrangements.
If you are currently in Bali and cannot return home due to the ash cloud situation, your policy has a 21 day automatic extension clause. This means that if you cannot return home due to circumstances outside your control, your policy will remain in force for up to a further 21 days without payment of additional premium. You don’t need to contact us to request a policy extension – this is an automatic provision.
- Disruption experienced pre-departure
If you have not yet departed on the insured trip and your outbound flight arrangements are cancelled due to:
- Natural disaster preventing the booked travel occurring as planned;
- Delayed departure of the initial outbound flight beyond 12 hours; or
- DFAT issuing a travel warning advising against travel to the affected region and which remains in force 7 days prior to scheduled travel;
there is provision within the policy for amendment costs or reimbursement of irrecoverable payments made in the event of total cancellation (Section 1).
In this case, Section 1 provides to cover the cost incurred to amend the policyholder’s travel to a later date / alternate route OR the cost of forfeited pre-booked travel arrangements if the trip is cancelled (whichever is the lesser). If a policyholder’s travel is affected, we retain the option to decide which of these options will be used as the basis for determining policy response.
Many airlines offer full refunds or rescheduling at no cost in the event of cancellation due to natural disasters and we therefore recommend policyholders liaise with the airline/s, travel agent/s and associated travel providers to minimise any loss / claim.
For Single Trip and Multi Trip policies purchased on or after 12 noon AEST on 3 November 2015:
Insurance serves to provide cover for sudden and unforeseen risks. It is not possible to insure against known risks and the policy specifically excludes claims resulting from circumstances known at the time of policy purchase or trip booking and which could reasonably be expected to give rise to a claim.
Whilst this circular details a preliminary assessment of potential policy response, it is anticipated that no cover will be afforded for any claim which relates to the Bali ash cloud under policies purchased on or after 12 noon on 3 November 2015 or trips booked under an Annual Multi Trip policy on or after 12 noon on 3 November 2015.
Please remember that no two claims are the same and accordingly, claims are assessed on a case-by-case basis. This advice is of a general nature. Claims are assessed on their individual merits and are subject to the terms and conditions of the PDS which was in force at the time of policy purchase.
Whilst we recommend affected policyholders liaise with airlines, travel agents, tour operators etc, our claims team is available to advise and assist you. Please contact us if you require assistance.