Does Your Insurance Cover Losses Caused by the Iceland Volcano?


The recent eruption of a volcano in Iceland disrupted air travel and air transport for several days. There are worries that a second volcano in Iceland may soon erupt on an even larger scale.

The disruption of air travel may have caused losses to American businesses for any number of reasons:

(1) lost supplies – property necessary for conduct of business could not be transported to or from Europe

(2) lost sales – property could not be sold or transported to a buyer

(3) lost persons – people could not travel to the business

Insurance policies may provide some coverage for these losses, if the business has the appropriate type of insurance and the insurance policy has the right wording. This disruption reinforces the need for a business to review their policies, consult with insurance brokers and lawyers, and try to obtain the appropriate insurance for risks the business faces. While it is a volcano which caused the disruption this time, there could be other events which could cause similar disruptions.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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