The recent Ahmedabad Air India crash is likely to emerge as India’s costliest aviation insurance claim, a Bloomberg report quotes preliminary industry estimates as saying. With over 279 deaths and heavy aircraft loss, the tragedy may lead to settlements totaling over \\$475 million, hitting global reinsurers and India’s insurance space as well.
Sources suggest that both hull loss (damage to the aircraft) and passenger liability claims will propel the record amount. Experts opine that this disastrous crash may spur aviation insurance premiums upwards, not only for Air India but also for the entire sector in South Asia. It might even lead to stricter underwriting for wide-bodies flying in emerging economies.
This is just as Air India was busy addressing a financial and operational turnaround, with a fresh push on fleet upgrades and safety measures. The crash and the subsequent turmoil could derail efforts at that end, forcing a review of risk management processes.
Indian authorities have already launched a full-scale probe, and the airline has offered cooperation to international aviation regulators. As insurers prepare for one of the biggest aviation payouts in history, the focus is very much on how this disaster rewrites India’s aviation insurance policy.
