Eyjafjallajökull. It's a name few newsreaders have attempted to pronounce. But there's no doubting the chaos this Icelandic volcano has caused, as its ash cloud forces a prolonged shut down of our airline network. It's also shown that travel insurance doesn't guarantee you won't be heavily out of pocket when things go wrong. 

The insurance industry sells peace of mind. But thousands of travellers have found their travel policy has instead given them a large financial headache. There's no standard British travel insurance policy. This means that some people are covered for the costs they've had to meet after being stranded by the ash cloud – but others aren't. And some insurance providers, such as HSBC, have decided to make goodwill payments, despite not covering natural disasters.

A lot of commentators have said insurance doesn't cover 'acts of God'. This is an urban myth, as the Association of British Insurance has confirmed. Insurers are agnostic about the existence of a greater being. They insure the consequences of a host of natural events that believers might call acts of God. The problem is that modern insurance policies tend to set out what is specifically covered. If your misfortune isn't on the list, you're on your own.

The other problem is that most travel policies were designed when we all took package holidays. If you're one of the millions who book your flights, hotels and car hire separately, you need to make sure your policy covers the indirect costs, such as hotel bills, if your airline can't run the flights you've booked. Many traditional policies cover delayed departures but not the consequential expenses you incur when your flight is cancelled. This is where the newer policies designed for independent travellers, such as M&S's, come into their own. They may cost more, but the extra few pounds buy that fabled peace of mind.

Disclosure: I was head of PR for M&S Money 2005 to 2008