In the aftermath of the recent collision at Tokyo’s Haneda airport involving a Japan Airlines Airbus A350 and a De Havilland Dash-8 Coast Guard turboprop, industry insiders reveal that insurance giant AIG has emerged as the primary insurer under a substantial $130 million “all-risks” policy.
While AIG has chosen not to issue an official statement, insider information suggests that the insurance coverage predominantly centers around hull damage. The incident at Haneda airport tested the efficacy of this coverage, resulting in a tragic collision that claimed the lives of five out of six crew members on the smaller aircraft. Thankfully, all 379 passengers aboard the Japan Airlines plane were safely evacuated.
The event underscores the intricacies of large-scale commercial insurance arrangements, where risk and coverage are often dispersed among multiple insurers.
Willis Towers Watson (WTW) has been identified as the principal broker for this insurance deal, as disclosed by a second industry source. However, WTW has refrained from offering comments on the situation.
The aviation insurance sector has confronted considerable challenges in the past year, further compounded by global events such as conflicts in Ukraine and Israel-Gaza. A recent report by Gallagher highlights the substantial impact on the sector.
The aviation reinsurance market witnessed significant rate increases, with hikes of up to 25% during the critical January 1, 2024, reinsurance renewal date. This shift in dynamics and the heightened risks in the aviation insurance and reinsurance markets were underscored in a recent report from Gallagher’s reinsurance division. The industry is navigating evolving circumstances, reflecting the broader challenges faced by insurers and reinsurers in the aviation sector.
