Category Archives: Volcanoes

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Airlines Lose Millions, Taxi Drivers Make Thousands

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The numerous airlines that have been grounded since a volcano under an Icelandic glacier erupted Wednesday are not covered by insurance.

Typical airline insurance policies would cover damage to planes if they flew through a volcanic ash cloud, but so far no plane has been damaged because of the ban on flights in the vicinity of the cloud, insurance companies and experts said. And airlines don’t have insurance for grounding planes due to natural events because policies would be very expensive, they said.

Thousands of flights have been cancelled into and out of Europe and hundreds of thousands of passengers have been stranded at airports throughout the world since Wednesday. Though those passengers may have trip insurance, the airlines cannot file a claim for this major business interruption (their business interruption insurance, if they have it, only covers the grounding of planes due to physical damage to the aircraft).

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The airlines are facing huge losses in revenue at a time when the industry is still struggling with reduced demand.

The Air Transport Association, or IATA, which represents some 230 airlines and 93% of scheduled international global air traffic said that at current levels of disruption, its initial and conservative estimate of the financial impact on airlines is in excess of 0 million per day in lost revenues.

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However, it said airlines would be hurt further as it they will incur added costs for re-routing of aircraft, care for stranded passengers and aircraft at various ports.

But there is a silver lining, however thin. Scandinavian ferries are fully booked and hotel owners are charging upwards of $800 a night while taxi drivers pocket $5,000 fares. So while airlines lose millions, stranded passengers confront desperation and the European economy takes yet another hit, there are those making the best of this natural catastrophe.

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Volcanic Ash Not Dissipating, Airports Still Closing

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The New York Times is providing fantastic coverage of the still-lingering volcanic ash cloud that has been severely disrupting — and in most places completely halting — air traffic in Europe since the Eyjafjallajökull volcano erupted in Iceland on Wednesday.

Here is the Times‘ graphic showing just how widespread the airport closures have been.

Eyjafjallajökull volcano airport

Over on their The Lede blog they also have video of the ongoing Eyjafjallajökull eruption, showing exactly how all that ash got into the atmosphere. Truly amazing. But truly troubling as well — and with no timetable for when flights may be able to resume.

Volcanologists had no reliable prediction of how long the eruption would continue, as travelers scrambled for train reservations, rental cars and hotel rooms. Others simply searched for comfortable benches in airports, which were considerably calmer and emptier than on Friday as passengers realized that no flights would be going in or out.
Europe’s three largest airports — London Heathrow, Frankfurt and Paris-Charles de Gaulle — were all shut on Saturday, with officials hoping that flights could resume sometime Sunday or, more likely, Monday.

Volcanologists had no reliable prediction of how long the eruption would continue, as travelers scrambled for train reservations, rental cars and hotel rooms. Others simply searched for comfortable benches in airports, which were considerably calmer and emptier than on Friday as passengers realized that no flights would be going in or out.

Europe’s three largest airports — London Heathrow, Frankfurt and Paris-Charles de Gaulle — were all shut on Saturday, with officials hoping that flights could resume sometime Sunday or, more likely, Monday.

Yikes.

Eyjafjallajökull Volcano Is Disruptive, Awesome

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Aviation authorities throughout the UK, France, Scandinavia and other parts of Europe were forced to halt all flights today as a giant plume of volcanic ash blow over the continent. The Eyjafjallajökull volcano in Iceland erupted Wednesday, causing some flooding and general inconvenience domestically, but the lingering and drifting cloud has caused the most problems.

The shutdown, among the most sweeping ever ordered in peacetime, forced the cancellation of thousands of flights and left airplanes stranded on the tarmac at some of the world’s busiest airports as the rolling cloud — made up of minute particles of silicate that can severely damage airplane engines — spread over Britain and toward continental Europe.

Obviously, this whole event is interrupting business throughout the EU and that is a big pain in the tuckus and people are upset and concerned and companies are losing money and yadda yadda yadda…

But much more importantly … LOOK, GUYS, IT’S LAVA … pretty much my favorite thing ever.

Below is a photo of an amazing eruption earlier this month by Eyjafjallajökull. I have no idea how to pronounce that. But it sure is gorgeous. Check out the Boston Globe‘s photo gallery for more awesome — both in the traditional sense and in cool-kid-vernacular — photos.

Eyjafjallajökull volcano glacier ash plane

An eruption of the Eyjafjallajökull volcano earlier this year. (Photo: Ulrich Latzenhofer via the Boston Globe)

UPDATE: Even better, here’s video of an eruption in late March.

UPDATE II: And, OK, fine … here’s some actual info about the insurance and business implications of the Eyjafjallajokull disruption from our friends at National Underwriter. (h/t @travel_facts)

Gordon Woo, lead catastrophist for Risk Management Solutions, said insurance implications from the Eyjafjöll volcano eruptions could include payouts from Iceland’s national natural catastrophe insurance fund—which covers volcanic eruptions and glacial floods—if there is damage.

Additionally, he said business interruption for the aviation industry could be triggered due to the temporary closure of airspace in the United Kingdom and Scandinavia as a precaution over the airborne ash plume.

Aviation and travel insurers will be hit by the cost of several days of flight cancellations, Mr. Woo noted.

Floods from the melting glaciers will likely cause river levels to rise and potentially cause damage, RMS said, citing Iceland’s Department of Civil Protection and Emergency Management.

The ash cloud affect, said Bill McGuire from the Aon Benfield UCL Hazard Research Centre, can cause major damage to aircraft by clogging engines and causing them to flame out, and by scouring windscreens so as to make them opaque.

The article also mentions that the last eruption by this volcano last 12 months — so there could be ash problems again in the future. Stay tuned.

And head over to National Underwriter for even more insights from Woo and McGuire.