Hull and liability
After a poor start to the year for aviation safety, in comparison to last year, we observed further airline losses and fatalities in the second quarter.
There were two fatal accidents during this period, which accounted for some 113 passenger and crew fatalities. This involved Cuba’s biggest fatal loss in three decades and the first fatality on a US commercial airliner since 2009. These accidents mark five fatal airline accidents to date in 2018 and bring the year to date fatality figure to 301.
There were also multiple other attritional incidents that occurred throughout the second quarter and aviation insurers also suffered general aviation and aerospace infrastructure losses, a number of which are expected to produce some significant claims.
The hull war class suffered its first loss of the year, during the second quarter, when an aircraft operated by Air Niugini’s LinkPNG subsidiary was destroyed by rioters. The DHC-8-Q200 aircraft had been parked at Mendi Airport, Papua New Guinea when it was reported to have been purposely set on fire by rioters who invaded the airport.
While the aircraft hull value will be relatively low, due to its age and type, this loss will do little to ease pricing pressure in a line of business that has a modest premium base and has been unprofitable for the last five consecutive years.
Note: Information based on reported airline incidents involving loss of life and or where sizable loss reserves are estimated (excludes GA aircraft). Source: Information collated from publicly available online sources.
*Figures are on a calendar year basis and are shown only as a guide. They include commercially operated jet or turboprop aircraft of more than 14 passenger seats or their cargo equivalent. Source: FlightGlobal/JLT data.
For more information, please contact Steven Godfrey, Aviation National Specialty Leader, Managing Director at ClientFirst@jltcanada.com.