2009 the most expensive year in airline insurance markets: Aon

2009 was the most expensive claims year in recent history, according to Aon’s Airline insurance market outlook 2010: equilibrium?
The aviation industry reported $2.3-billion worth of claims in 2009, including an estimate for minor losses, Aon found.
This is above the $1.8-billion average value of claims between 1998 and 2008.
However, although it may have been the most expensive year for claims, the number of major losses and fatalities was nevertheless lower than the average, the report added.
Lead hull and liability premium rose by 20% or more in three of the four quarters of 2009 — up to $1.9 billion from $1.6 billion in 2008.
Due to the high value of losses, 2009 will be the third consecutive year of losses suffered by airline underwriters.
Prices are expected to continue to rise in 2010 as a result.
While premium outweighed claims in the airline insurance market in 2008, adding an allowance for reinsurance and fixed costs would put the airline book into the red, the report finds.
“A fourth year with limited profit could potentially have a significant impact on capacity, particularly given that capital providers may already be looking at the recovery of other financial markets and wondering if their resources may be better placed elsewhere,” according to the report.