Latest news with #Saiwal
India Today
13-06-2025
- Business
- India Today
Air India crash: How airline insurance works and why premiums may rise
In the aftermath of the catastrophic Air India crash in Ahmedabad, there has been a significant focus on the role of airline insurance in such unfortunate events. The incident is expected to trigger India's costliest aviation insurance claim, with the payout likely to exceed $120 million, people familiar with the matter said, as quoted by The Economic what exactly does airline insurance cover, and how long does it take for victims' families and the airline to get the money? Let's break it down in simple DOES AIRLINE INSURANCE COVER?Airline insurance primarily comprises three main components: physical damage to the aircraft, passenger legal liability, and third-party liability. According to Evaa Saiwal, Business Head Liability, Cyber, and Speciality Risk at PolicyBazaar for Business, commercial airlines typically invest in comprehensive aviation insurance, which usually includes hull insurance, passenger liability, third-party legal liability, cargo liability, and crew personal accident cover."Hull insurance covers physical damage to the aircraft itself, whether on the ground, during taxiing, or in flight. Liability insurance protects the airline from legal claims arising from bodily injury, death, or property damage caused to third parties, including passengers, airport personnel, or people and property on the ground," she Saiwal further mentioned that hull coverage reimburses the airline, whereas liability coverage benefits the victims or their families, in line with global frameworks like the Montreal this incident, the hull loss is pegged at around $80 million, mentioned the report. Passenger legal liability, covering injury or death of passengers, and third-party liability, for damage or injury to those on the ground, are also included in the coverage. Such liabilities, especially in the case of high-net-worth passengers as seen in the Air India crash, could push the claim amount significantly ARE AVIATION INSURANCE PREMIUMS AND RISK ASSESSMENTS INFLUENCED BY SUCH ACCIDENTS?Incidents like the recent Air India crash can result in a total loss, meaning the aircraft is beyond repair with no salvageable parts. In such cases, the losses can reach around $130 million, roughly $80 million for the plane and $30-50 million in high-cost claims often lead insurers to reassess risk factors more strictly. Underwriters may tighten criteria, especially focusing on the aircraft's condition, before issuing or renewing legal liability covers injuries or fatalities, while baggage loss, including electronics, is also compensated. Additionally, travellers with personal travel insurance may receive extra benefits for emergency medical care and trip to Rakesh Goyal, Director at Probus, "In situations as devastating as the Ahmedabad plane tragedy, passenger insurance is critical in providing financial assistance. It offers compensation to families or survivors in the event of accidental death or injury, based on the specific terms of the coverage. For airlines, such policies are typically mandated under aviation regulations and offer benefits that include accidental death compensation, medical expenses for survivors, and in some cases, even support for repatriation."advertisement"It's one of those protections we hope is never needed, but when something terrible happens, like what happened in Ahmedabad, its necessity becomes undeniable," he IS THE TYPICAL TIMELINE FOR SETTLEMENTS?Settlements for aircraft damage are usually processed relatively quickly. However, claims related to passengers and third parties often take much longer, typically between two to three years or delay is mainly due to legal proceedings, thorough investigations, and the need for proper verification before compensation is following the tragic plane crash, Bajaj Allianz Life Insurance has simplified its claim process. Nominees or legal heirs can initiate claims with minimal paperwork. In cases where the death certificate isn't immediately available, a hospital or municipal certificate will suffice, along with KYC and bank details of the AVIATION INSURANCE PREMIUMS RISE AFTER THE AHMEDABAD PLANE CRASH?The impact of such incidents on insurance premiums is considerable. Experts note that underwriters may introduce more stringent parameters when assessing the policy terms, especially concerning the aircraft's events affect not just the airlines involved but also have a ripple effect across the global insurance landscape. This crash is poised to push global aviation insurance rates higher, particularly affecting markets like India where loss ratios have been relatively Watch
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Business Standard
02-05-2025
- Business
- Business Standard
Demand for D&O liability insurance rises 25-35% in FY25, says report
Increased board accountability, along with investor pressure and regulatory interventions, has resulted in a 25–35 per cent increase in demand for Directors & Officers (D&O) liability insurance in FY25, according to Policybazaar data. According to the insurance distributor, the trend implies increased awareness among promoters, start-ups and mid-sized companies of the personal liability risks faced by key managerial personnel. It has also seen nearly 85 per cent renewal in these policies. Policy discontinuation has been minimal, with non-renewals primarily linked to changes such as mergers and acquisitions, changes in shareholding patterns, or company closures. 'What once started as a compliance-driven necessity has now evolved into a cornerstone of proactive risk management. The increasing recognition of D&O insurance as a vital safeguard for leadership reflects a strategic shift in how businesses approach risk,' said Evaa Saiwal, Head of Liability Insurance at Policybazaar. The average sum insured for D&O insurance for small enterprises (start-ups and SMEs) is in the range of Rs 50 lakh–Rs 2 crore. For mid-sized companies, the average sum insured ranges between Rs 2 crore and Rs 10 crore, with premiums of around Rs 1–5 lakh. For large enterprises or corporates, the average sum insured is more than Rs 10 crore, with premiums over Rs 5 lakh. 'As IPO-bound companies embrace D&O coverage more than ever, we are witnessing a surge in its value—a direct response to the growing prominence of board accountability and the very real threat of leadership liability in today's fast-paced, litigious environment,' Saiwal added. Other than IPO-bound companies, ESG failures and cybersecurity lapses are emerging as key drivers for D&O demand. There is also an increase in directors asking for D&O policy reviews before accepting board positions, indicating heightened caution around personal liability. Additionally, more businesses are opting for non-rescindable Side A-only excess policies—especially for independent directors—offering broader protection in cases of insolvency or lack of indemnification. With increased demand, there has also been 10–15 per cent growth in claims, triggered mainly by alleged breaches of fiduciary duties—indicating higher board-level scrutiny, a surge in litigation costs, increased regulatory investigations, and growing concerns around reputation management and crisis response. This highlights the reputational stakes involved in D&O exposures.
