May 17, 2002 by Canadian Underwriter
Once more, the U.S. government has extended the deadline for third-party war risk coverage for airlines, this time by 30 days. The coverage was set to run out on May 19, but will now last at least until June 19.
The coverage, which is for third-party war risk and terrorism liability, was instituted following the September 11 terrorist attacks when private insurers cancelled the coverage for airlines. Originally, the government offered six months of coverage for losses in excess of US$50 million. It was later extended a further two months.
The future of airline insurance in Canada is also under discussion, with Transport Minister David Collonette having extended the government’s coverage several times. It is set to run out on May 20. Collonette had publicly pushed insurers to come up with a private solution that was both affordable and at an acceptable level of coverage.
Many of the world’s airlines have been looking at devising their own insurance coverage as a co-operative effort. European airlines have put forward the “Eurotime” solution and seek government support for the self-insurance scheme. U.S. airlines are also currently seeking a self-insurance scheme with the aid of a major commercial broker there.