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Aviation insurance : Marine…

- - - - WWII: 1. the demand for insurance to cover hull values and liability exposures increased from wide-bodied jet A/C 2. liability exposure of manufactures and component parts increased
        
        1960's-1970's: War risks or all risks policies was developed because of hijacking and terrorism. Reinsurance facilities to be provided in the US.
        
        1980's
        IATA-owned captive insurance company: owned by members of a common industry or trade association to share the risk
        
        1990's
        
        Non-aviation related litigation against brokers.
        
        Risk securitization / Catastrophe reinsurance
        
        1990-2000: Claims exceeded premiums by 13 billion.
        2000s: Cancellation of all war risk policies following 9/11; re-evaluation of probable maximum loss(PML) : Coverage for Weapons of Mass Destruction(WMD)
        2009: the capacity of Liability market is around $3 B, and limits up to $2 B are commonly purchased
        
        2012 & 2013 the lowest fatality level 2014 Major losses
- - - - :warning:
        Principal aviation insurance categories:
        
        Aircraft operators' hull, passenger and third party liability
        
        Aviation manufacture's and suppliers products liability
        
        Airport owners' and operators' liability
        
        Related convention:
        
        Roma Convention 1952: the insurance will be considered satisfacotry.
        
        Montreal convention 99 Article 50- :Compulsory Insurance
        States Parties shall require their carriers to maintain adequate insurance covering their liability under this Convention
        
        Type of Aviation Insurance:
        
        Hull Insurance
        2.Liability
        
        War and allied peril
        
        Political Risk
        
        Liability Insurance covers legal liabilities of the insured airlines to cover any physical injury to passengers and damage to persons or property resulting from the operation of the aircraft
        
        Primary Aircraft Liability covers third party bodliy injury and property damage
        A.Bodily Injury or Death to Passengers
        B.Bodily Injury or Death to Non Passengers
        1. Mid Air Collison 2. People on the ground
        C. Property Damage
        1.Collision with another aircraft, structure, ground equipment etc
        
        Hull Insurance: is a coverage made to protect against physical damage caused to all parts of an aircraft. ( Exception: damaged casued due to war and allied perils). a. The payment is predetermined which is not related to current market price b. When the airframe is total damaged, it would be considered to be damage no matter of the condition of the engine
        
        Primay Hull Insurance covers the physical damage to the aircraft:
        1.All Risk
        
        Agreed value
        
        Occurrence Based
        
        Political Risk Insurance:
        1.financiers are unable to recover possession of their aircraft due to any governmental activity.
        2.covers 3 years, practically non-cancellable opposed to a hull risk typically for a period of one year and can be terminated in short notice
        3.It can take up to 180 days for the insurer to claim the amount under the political risk policy.
- - - - Do not cover the liability claims against additonal insured for liability
      - Do not cover the claims arising from the desing , manufacture, modification or repair of aircraft(Aviation Products Exclusion)