Air India gets fleet cover despite high claims

Mumbai: Air India has managed to get quotes for its fleet insurance at a marginal increase over the previous year despite claims of close to $100 million. ICICI Lombard General Insurance has emerged the lowest bidder in the tender for fleet insurance floated by the National carrier. The net cost of covering Air India’s `45,000 crore fleet as per ICICI Lombard’s bid is around $30 million against $25 million in the previous year. The increase is not very significant considering the large claims in the previous year.
The national air carrier faced claims of close to $100 million after a Boeing 737-800 crashed while landing in Mangalore on May 22, killing 158 people on board. A year earlier, the airline lodged a $16 million claim after a fire incident in a Mangalore-bound flight in Mumbai. State-owned insurer New India is understood to have bid close to ICICI Lombard but appears to have lost out by half a million dollars.
Three bidders had applied for the fleet cover of National Aviation Company of India — the largest airline in the country which owns the Air India, Indian and Alliance Air brands. Besides ICICI Lombard, there was a consortium of state-owned companies led by New India Assurance. The insurer with the expiring policy was a consortium led by Reliance General Insurance with Iffco Tokio, HDFC Ergo and Bajaj Allianz as part of the consortium. This time Reliance General has stayed out and the group of private companies is led by IFFCO Tokio General Insurance.
18/09/10 Mayur Shetty/Economic Times

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Categories: NACIL Sep 2010