Losses Impact Aviation Rates

Airline insurance programs saw an average premium increase of more than 20 percent in July bringing the average increase for the year so far to 17 percent, according to Aon’s August 2009 Airline Insurance Market News. That said, Aon notes that the average is somewhat inflated by the renewal of a U.S. program that had a fatal loss earlier in the year. Without that, the average increase in lead hull and liability premium would only be 14 percent so far this year. Irrespective of the specifics, the current conditions are clearly a significant turnaround compared to 2006 and 2007, when prices in the airline insurance markets declined by more than 10 percent each year. Despite only one major loss since June, 2009 still looks set to be very expensive from a claims point of view, according to Aon. Overall losses (including minor losses) have cost aviation insurers $1.66 billion so far in 2009, compared to $798 million in 2008. Check out I.I.I. aviation facts and stats.

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