April 29, 2015 by Angela Stelmakowich, Editor
NEW ORLEANS, La. – Technological advancements in aircraft are part of the risk management process and risk management professionals need to keep up to speed with all lines as they develop, suggest two senior officials with Aon Risk Solutions.
“Cyber is a growing area of concern from a safety and financial aspect,” Peter Schmitz, chief executive officer, Global Aviation Specialty for Aon Risk Solutions, and Toronto-based Jason Hutchings, vice president and Eastern Canada practice leader, Aviation Practice for Aon Risk Solutions, told Canadian Underwriter in advance of the RIMS 2015 Annual Conference & Exhibition.
However, there have been some positive developments. “The improvements we have seen over the years have contributed to increased safety awareness and better safety records,” Schmitz and Hutchings point out.
“This evolving area would be the crossover between the aviation insurance world and the cyber liability insurance products that are currently available. There is room for both products to grow and evolve,” they say.
Although current aviation insurance products are meeting the needs of Aon clients, “how the evolving cyber liability/data security products are of particular interest to many organizations,” Schmitz and Hutchings note.
Overall, they add, “at the moment, there remains significant capacity in the aviation insurance market.”
Despite a challenging 2014 for the airline book of business, Schmitz and Hutchings say the industry is still very safe. Although many factors influence claims costs – such as type of loss (hull versus liability), jurisdiction, inflation, age of aircraft, loss severity and loss frequency – “we have not seen increasing claim costs or a deteriorating number of outcomes or lawsuits increasing as a result of technological advances in aviation. Costs for handling lawsuits continue to increase, but consistently with other lines,” they report.
The RIMS Annual Conference & Exhibition is being held Apr. 26-29 in New Orleans.
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