Indian insurance industry sources said GIC Re will be paying around Rs18 crore while three other PSU general insurers, New India Assurance(NIA), Oriental Insurance Company(OIC) and National Insurance Company(NIC)will have fork out Rs 5 crore each to meet their part of liabilities in the JAL policy
U.S. insurer AIG was the lead insurer on a $130 million “all-risks” policy for the Japan Airlines airplane
Indian re/insurers led by GIC Re have to shell out Rs 33 crore out of total Rs 1100 crore claims for the Japan Airlines(JAL) airplane which collided with another plane at Tokyo’s Haneda airport on Jan 2,
U.S. insurer AIG was the lead insurer on a $130 million “all-risks” policy for the Japan Airlines airplane.
All 379 people aboard the Japan Airlines Airbus A350 escaped after a collision with a De Havilland Dash-8 Coast Guard turboprop that killed five of six crew on the smaller aircraft.
The Japan Airlines policy mainly covers damage to the hull, one of the sources said.
Large commercial insurance deals are typically split among a number of insurers.
Indian insurance industry sources said GIC Re will be paying around Rs18 crore while three other PSU general insurers, New India Assurance(NIA), Oriental Insurance Company(OIC) and National Insurance Company(NIC) will have fork out Rs 5 crore each to meet their part of liabilities in the JAL policy.
However, sources in the PSU general insurance said that there is still a confusion about the reasons of the collision between Coast Guard tubroprop plane and JAL aircraft as some say the former entered the runway wrongly when the latter was landing. If it can be proved that Coast Guarad tubroprop plane entered the runway wrongly, the insurers are not liable to pay the claim.
Though, the Indian re/insurers will pay the claim now but can recover it if it is proved afterwards that Coast Gurad tubroprop plane had entered the runway wrongly.
“GIC Re is the leader of the Indian consortium and along with other Indian general insurers provide capacity to international aviation market from London market. JAL is one of the policies where this consortium, that almost generates Rs 500 crore of annual premium, has three per cent of airlines insurance policy. Overall, the aviation insurance business has been a profitable business for Indian insurers,’’ said sources in the Indian insurance industry.
GIC Re, had paid Rs 35 crore as part of the claims for the Malaysia Airlines aircraft that crashed in Ukraine in july 2014.Before that, It had also paid Rs 70 crore when an aircraft belonging to the carrier disappeared in March 2014.
Willis Towers Watson was the main broker on the deal
Last year was challenging for the aviation insurance market, insurance broker Gallagher said in its recent report, given the Ukraine and Israel-Gaza conflicts.
Aviation reinsurance rates rose by as much as 25 per cent at the key Jan. 1, 2024 reinsurance renewal date, Gallagher’s reinsurance unit said in a report this week.
Japan has not suffered a serious commercial aviation accident in decades.
Its worst ever was in 1985, when a JAL jumbo jet flying from Tokyo to Osaka crashed in central Gunma region, killing 520 passengers and crew.
That disaster was one of the world’s deadliest plane crashes involving a single flight.