Aviva won't be shaken by volcano air crisis

The final impact is not expected to be anywhere near the same magnitude as the snow and floods last year which cost Aviva 35m in the UK.

Aviva's UK chief executive Mark Hodges said it was too early to put a figure on the final cost of the Icelandic volcano ash cloud, but said that the vast majority of travellers' claims should be met by airlines and travel companies.

"The way that the policy clauses were re-worded after 9/11 means that if planes are grounded by civil aviation authorities, then that's not insurable," he said.

"But so many people are stranded that we are looking at what we can do to help those customers who are facing difficulties as a result of this extraordinary event.

"We've automatically extended customers' insurance policies and travel delay cover as a gesture of goodwill. We've also doubled the number of people in our call centres to support our stranded customers, including helping customers to get essential medical supplies if necessary."

The British Insurance Brokers' Association has advised passengers to contact their travel insurers as soon as possible.

"In many circumstances, your travel agent or tour operator will simply make alternative arrangements, but if you have booked independently you should speak to your insurance broker, who can advise you during these unusual circumstances," said Graeme Trudgill, the association's technical and corporate affairs executive.

The Association of British Insurers said there is no standard set of conditions in a travel insurance policy which applies to the chaos caused by the Icelandic volcano.

"Customers should check their travel insurance policy, and speak to their travel insurer to understand what their individual policy covers them for in this situation," said an ABI spokesman.

Aviva has said that if flights are cancelled, the passenger's airline should provide either a refund of the ticket cost or alternative flights.

The airspace shutdown will leave British carriers facing multi-million pound losses.

British Airways said the closure has cost it 15m to 20m a day and it has asked the Government and the European Union for compensation.

Budget flyer easyJet said it had taken a hit of around 40m after having to cancel over 4,500 flights.

Plans were grounded for five new EasyJet routes from Doncaster's Robin Hood airport, to Amsterdam, Prague, Barcelona, Faro and Majorca, forcing the postponement of what airport director Mike Morton called a "massive milestone for the airport".

Every day the volcanic ash cloud continues to ground planes costs EasyJet another 5m in lost profits.

Dart Group, the Leeds Bradford airport-based company, said the ash cloud from Iceland's volcanic eruption has so far cost its budget airline Jet2.com 2.8m in profits.

Dart said cancelling more than 400 flights and accommodating and repatriating passengers and holidaymakers has hit profits by about 350,000 a day. But the group added its balance sheet is strong enough to withstand a "considerable period of disruption".

One study, by UBS Investment Research, said Europe's top six airlines – BA, Lufthansa, Iberia, Air Finland, EasyJet and Ryanair – are losing revenues of 105m to 124m each day.

Irish budget carrier Ryanair said the disruption was costing it around about 5.25m a day.

Goodwill gesture for the stranded passengers

Aviva has said that if a flight is delayed by over two hours, the airline should provide passengers with free meals and refresh-ments as long as they checked in on time.

The insurer said that if passengers are unable to recover the costs from their travel provider, it will consider paying a delayed departure benefit for every full 12-hour period the flight is delayed, as a goodwill gesture.

This is up to a maximum of 250.

Similarly, if a flight is delayed for more than 24 hours and the passenger decides to abandon their outward international journey from the UK, it will refund unused travel and accommodation costs. However, this only applies if the passenger has already checked in.