logo
Possibility of pilot error not to impact compensation for Air India Dreamliner crash victims

Possibility of pilot error not to impact compensation for Air India Dreamliner crash victims

Indian Express12-07-2025
Compensation for the victims of the Air India 787-8 Dreamliner crash in Ahmedabad a month ago will not be affected by the possibility of pilot error, according to industry experts. Both the airline and the families of those who died in the crash are generally entitled to compensation, even when pilot error is involved.
In fact, the compensation amount could potentially increase if negligence by maintenance staff or technicians is established, sources said. The exact compensation and legal proceedings vary depending on the jurisdiction and whether the flight was domestic or international.
Airlines typically maintain liability insurance that covers passengers or their families in the event of injury or death, regardless of whether the cause is pilot error, mechanical failure, or other factors like pilot suicide.
An insurance official explained that pilot error generally does not influence passenger compensation, which is largely governed by international or national aviation laws and the airline's own policies. Under the Montreal Convention, applicable to most international flights, airlines are strictly liable for damages up to a certain threshold –currently around SDR 128,821 or approximately Rs 1.50 crore per passenger — and can be held liable for higher amounts if negligence, including pilot error, is proven.
Even if a crash happens due to suicide by the pilot, compensation won't be impacted. If an insurer can establish gross negligence or deliberate concealment by the airline such as knowingly permitting a mentally unfit pilot to operate a flight, it may challenge or reduce the payout to the airline. However, compensation to passengers or their families is generally safeguarded and not affected in such circumstances.
Chetan Kashyap, Head- Aviation and Speciality Lines, Prudent Insurance Brokers, said, 'a Hull 'all-risks' policy is a policy that covers all risks with 'named' exclusions. Pilot error, if any, is not an exclusion to it and hence insurance payout remains unchanged. Even machinery failure or system failure is not excluded under the policy wherein the only difference is right of subrogation which gets passed on to insurers in such case against the OEM (original equipment manufacturer) but overall insurance payout remains unaffected. Also, in this case passengers or third-party claimants can also claim damages from OEM for failure of parts.'
According to Hari Radhakrishnan, Expert with the Insurance Brokers Association of India (IBAI), Air India will get compensation for the loss of aircraft and passenger liability even if there was pilot error. 'Too early to say this, but even if it was pilot suicide and deliberately crashed, the insurance would pay. Insurers paid claims for Germanwings Flight 9525 crash in 2015 that killed 150 people, where the copilot locked out the captain from the cockpit and flew the plane into a mountain,' Radhakrishnan said.
For domestic flights within India, compensation is governed by national regulations such as the Carriage by Air Act and guidelines set by the Directorate General of Civil Aviation (DGCA), which ensure that passengers or their families are compensated regardless of who is at fault. In cases where foreign nationals are among the deceased, families have the option to file claims in jurisdictions such as the country of the carrier, the place where the ticket was purchased, or the home country of the victim. Since nationals from Britain, Canada, and Portugal were among the victims, legal proceedings in international courts are likely.
For Air India, both hull and liability insurance are expected to cover the damages. These policies typically include coverage for the loss of the aircraft (hull loss), passenger liability, and third-party liability. Pilot error is also covered under standard aviation insurance policies unless gross negligence or intentional misconduct is proven, which remains rare and difficult to establish. If the pilot is perished in the crash, his/ her family could still receive compensation from the airline's group life insurance and any personal accident insurance policies, unless there was a violation of policy terms such as flying under the influence, said a source.
The Tata Group, which owns Air India, has announced an ex gratia compensation of Rs 1 crore to the next of kin of all passengers who died in the crash. Families of people who died on the ground will also be eligible for this Rs 1 crore compensation, and the company has stated it will cover medical expenses for those who were injured.
According to insurance industry sources, the crash is expected to result in total claims of around Rs 4,000 crore (approximately $470 million), making it one of the most significant insurance events involving an aircraft accident. The aircraft hull alone is estimated to cost insurers and reinsurers about $80 million, with the engines valued at an additional $45 million. Liability claims related to passenger deaths are expected to reach approximately $350 million, though the final amount may vary depending on the number and nature of claims filed and the jurisdictions involved.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

KRT gets Sebi nod for Rs 4,800cr REIT IPO
KRT gets Sebi nod for Rs 4,800cr REIT IPO

Time of India

time40 minutes ago

  • Time of India

KRT gets Sebi nod for Rs 4,800cr REIT IPO

Knowledge Realty Trust (KRT), sponsored by realty firm Sattva Group and Blackstone, has got Sebi approval to launch its REIT public offering to raise Rs 4,800 crore. Last month, KRT had raised Rs 1,400 crore from investors ahead of its maiden REIT public issue. This is part of a strategy to monetise its 30 prime office assets across major cities. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now

'Premium pitch key growth pillar for Nestle India'
'Premium pitch key growth pillar for Nestle India'

Time of India

timean hour ago

  • Time of India

'Premium pitch key growth pillar for Nestle India'

NEW DELHI: India is one of the fastest-growing markets for Swiss packaged foods giant Nestle globally, driven by the country's large consumption base, strong performance of core brands, and entry into new, high-potential premium categories, according to , the outgoing chairman & managing director of Nestle India. Tired of too many ads? go ad free now With a turnover of over Rs 20,000 crore and a revenue CAGR of just over 10% during the past decade, Nestle India is well-positioned to sustain its growth momentum, he said. Its strategy - anchored in premiumisation, faster-paced innovation, and a sharper focus on 'Rurban' markets through a consumer cluster-based approach - is expected to accelerate growth for the packaged foods company in a market which has been facing stubborn commodity inflation and a consumption slowdown, said Narayanan. "Premiumisation and innovation are the two key pillars of growth. Along with a focus on legacy brands like and KitKat, the company aims to deliver sustained growth. Since the Maggi crisis in 2015, Nestle recalibrated and rejuvenated its portfolio by launching over 150 new products, which now contribute 7% to sales. Innovation is now four times faster than it was a decade ago," he told TOI in an interview. Premium products contribute around 12% of Nestle India's sales, up from 10% in 2018, growing at a 16% CAGR since 2015. With a Rs 7,500 crore market opportunity, premiumisation is a key driver of growth and profitability. Nestle India's capital expenditure has risen from nearly 2% of sales in 2015 to 10% of sales in FY 2024-25 - a clear reflection of the company's growing confidence in the Indian market and its deepening focus on serving evolving consumer needs. Additionally, through a consumer cluster-based and 'Rurban' strategy introduced in 2019, the company strengthened its route-to-market, with its brands now reaching two out of three households, said Narayanan, adding this strategic agility, combined with deep consumer insights, positions Nestle well to capitalise on evolving market trends and shifting preferences. Tired of too many ads? go ad free now Responding to a question on the company's strategy of steering clear of mergers and acquisitions, he said, "We continue to explore good opportunities. But again, the question is one of valuation, potential, synergies, and growth opportunities that we see." India ranks among the top 10 global markets for the Switzerland-based Nestle and is the leading market worldwide for its flagship food brand Maggi, as well as the second-largest market for its confectionery brand KitKat.

How to start a gym business and make it succeed: Here's a 6-step guide
How to start a gym business and make it succeed: Here's a 6-step guide

Time of India

timean hour ago

  • Time of India

How to start a gym business and make it succeed: Here's a 6-step guide

Academy Empower your mind, elevate your skills Challenges on the floor Talent management How to start a gym business Fifteen years ago, when Saif Malik joined Anytime Fitness as general manager, he had no designated seat and zero access to the owner. 'I saw how things worked and, more importantly, how they didn't,' says Malik, who had grown up observing his older brother run a gym . Since then, he had dreamt of owning one himself. 'I knew the gaps that needed to be plugged: poor amenities, angry members walking out, staff with no voice,' he says. So, when he opened his own gym, Component Fitness, in 2021, he set out to fix these drawbacks. The gym was launched along with a friend with an investment of Rs.1 biggest expenses were for the equipment and rent, which comprised Rs 7 lakh annually and accounted for 60% of the total capital. Another 30% went into space design, and the remaining 10% on marketing and advertising. 'We didn't cut corners on quality,' he a year, Malik had expanded the gym from 3,000 to 7,000 sq ft to accommodate the surge in footfall. The reason for this rapid growth, he says, was his 'consumer -first approach'. He offered premium amenities at affordable prices and supported members through personal challenges, waiving fees for accident victims and pregnant women. Empathy guided his decisions. After the Pahalgam attack, he extended free memberships to all army tried various marketing channels—pamphlets, newspaper ads, billboards and online campaigns. At the outset, he spent Rs.20,000-25,000 a month on Instagram, which proved very effective. His priority was brand awareness over profits. 'I was okay about breaking even as long as people knew about us,' he gym now offers three-, six-, and 12-month plans priced at Rs.10,000, Rs.15,000, and Rs.24,000, respectively. The monthly revenue ranges from Rs.20-25 lakh, with profits of Rs.10-12 faced teething troubles. 'The biggest challenge for gym owners is underinvesting in amenities due to tight budgets,' he says. Most people also overlook the opportunity cost. 'If you could earn Rs.20, but settle for Rs.10 by selling at Rs.12, that's not profit; it's an unseen Rs.8 loss,' he explains. His industry experience helped him avoid such the right location was also a challenge. 'If your rent is too high or you open a premium gym in a low-income area, you're setting yourself up for failure,' he says. Success depends on research, knowing the local demographic, and pricing to match purchasing discovered that the largest operational expense wasn't marketing, but salaries. With a team of over 30, people management has been both fulfilling and demanding. 'Finding well-educated, professional trainers remains a challenge, and lack of formal education often reflects in their conduct,' he notes. To address this, Malik places a strong emphasis on training his staff in etiquette and professionalism, particularly to ensure a safe and welcoming environment for keep his team engaged and motivated, his company offers generous appraisals, subsidised meals, and regular team outings Malik has also implemented an Annual Maintenance Contract (AMC) to ensure the gym's equipment is of the ongoing challenges for him is the demanding nature of work. He cautions against viewing the gym business as a passive income stream. 'This isn't a side hustle. You have to give it your all,' he says. In the early days, Malik clocked up to 20 hours a day; even now, he puts in 14-15 hours ahead, he is focused on scaling the business through franchise partnerships. His model is straightforward: 50:50 investment, with the brand contributing half the capital. 'It ensures that the partner knows we have skin in the game,' he every gym in your target area. Check the facilities they offer, how much they charge, and what their weak points are. Your goal should be to offer better services at the same or slightly higher price. That's how you create assume what customers want; observe and ask. Is your target area price-sensitive or driven by quality? Avoid launching a premium facility in a low-income neighbourhood or a basic gym in an upscale area. Your offering must align with the local people through the door is the hardest part. Use Instagram, flyers, newspaper ads, and word of mouth to create brand awareness. Even if your initial revenue just covers your marketing spend, it's worth it. Conversion happens once people is where many gym owners go wrong. Invest in annual maintenance contracts and fix broken machines. Poorly maintained equipment leads to cancellations and bad reviews. Customers expect trainers represent your brand. Look beyond certifications, check how they talk, behave, and treat people. Most trainers need to be trained in professionalism. Make sure female clients feel safe at all on building good reputation, not just revenue. Give discounts and help out members going through personal challenges. Such details go a long way and profits will automatically Malik, owner of Component Fitness

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store